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The Numbers Tell the Story
Royal Air Philippines wasn't exactly thriving in its final months. International passenger numbers slipped to 51,800 in 2025, according to Airlines. That's a steep drop from the 100,000 to 116,000 international passengers the airline carried in 2023 and 2024. And domestic traffic? That collapsed by 63 percent to just 38,800 passengers. Those aren't the figures of an airline experiencing a temporary rough patch; that's a death spiral. When your passenger count drops that dramatically in a single year, you're not coming back from it. The airline's website confirmed it would "suspend its commercial passenger operations effective 04 January 2026," according to an advisory posted December 29, 2025.What Happened to Royal Air Passengers
If you're one of the thousands caught in this mess, you're probably pretty frustrated right now. The airline entered Chapter 7 bankruptcy liquidation, which means it's selling off assets to pay creditors. Passengers with tickets? They're generally at the bottom of that priority list. Royal Air operated domestic leisure routes like Manila to Caticlan and Manila to Cebu, plus international services to Taiwan, South Korea, Hong Kong, Vietnam, Cambodia, and China. Those are popular routes, especially during the winter travel season, so rebooking isn't going to be cheap or easy. The airline positioned itself as a niche low-cost carrier, but "low-cost" only works if you can fill seats. Clearly, Royal Air couldn't. Founded in 2002 and licensed for commercial passenger flights in 2017, the airline spent years carving out a small space in an intensely competitive regional market. But rising fuel costs, post-pandemic recovery challenges, and relentless competition from better-capitalized carriers finally squeezed it out.A Pattern Emerges
Royal Air isn't alone in its struggles. It follows 2025 bankruptcies like Spirit Airlines and Play Airlines, part of a broader wave of airline liquidations hitting smaller carriers hard. The post-pandemic travel boom that everyone expected to be a rising tide lifting all boats? It didn't quite work out that way for budget airlines operating on razor-thin margins. CEO Eduardo Novillas sent a letter dated December 22, 2025, to the airline's Taiwan general sales agent announcing that "Royal Air Philippines would stop all commercial flight operations effective 04 January 2026," according to Airlines. Bookings were only available through January 3, 2026, giving passengers just days to figure out what was happening. What's almost darkly amusing is the airline's statement amid all this chaos. Even as it cancelled every flight, the company's messaging included the line: "It is looking forward to welcoming you aboard soon," according to Airlines. That's either impressive optimism or someone forgot to update the website. Either way, it's not happening.What This Means for Philippine Aviation
The collapse of Royal Air leaves a gap in the Philippine aviation market, though it's unclear whether competitors will rush to fill those routes or if they'll determine the demand just wasn't there to begin with. Given Royal Air's passenger numbers in its final year, probably the latter. For travelers, the lesson here is painfully clear: booking with smaller carriers always carries risk, especially when you're buying tickets months in advance. Travel insurance that covers airline bankruptcy is worth considering, particularly if you're flying a budget carrier you haven't heard much about. Industry observers point to rising fuel costs, intense competition, and fluctuating demand as ongoing pressures for smaller carriers like Royal Air. The pandemic accelerated consolidation in the airline industry, and boutique operators without deep pockets or strong backing are finding it harder to survive.Your Next Steps If You're Affected
If you had a Royal Air booking, start looking for alternatives immediately. Check if you paid with a credit card; some cards offer travel protection that might cover airline failure. Contact your travel insurance provider if you purchased a policy. And be prepared to pay significantly more for replacement flights on routes that are likely already filling up. The 3,000 to 4,000 affected travelers are learning an expensive lesson about the fragility of budget aviation right now. Twenty years in business doesn't guarantee tomorrow's flight, especially when the numbers are moving in the wrong direction as quickly as Royal Air's were.More travel news
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About the Author
Bob Vidra
Bob Vidra, based in scenic Tahoe, is an esteemed tech editor known for his deep understanding of the dynamic intersection of technology, travel, and the outdoors.
