Yt Framework

The Philippines’ largest national flag carrier, Cebu Pacific (PSE:CEB) will commence long-haul flights in the 3rd quarter of 2013. The airline will lease up to 8 Airbus A330-300 aircraft to serve new markets beyond the range of CEB’s current fleet of Airbus A320 aircraft.

The Airbus A330 has a range of up to 11 hours which means CEB could serve markets such as Australia, Middle East, parts of Europe and the US. The aircraft is one of the most commonly used wide-body aircraft in operation today, given its highly reliable operating statistics.

“The A330-300 will give us the lowest cost per seat, allowing us to drive long-haul fares 35% lower than those currently offered by other airlines, and as much as 80% lower when CEB offers promo fares. This aircraft type is very well suited to the kind of network we want to build and the routes we want to launch,” said Lance Gokongwei, CEB President and CEO.

“We are exploring serving cities where large Filipino communities reside --- Europe, Middle East, Oceania and the USA. Data indicates that more than half of Filipinos deployed in these regions take multiple stops and connecting flights because no home carrier can fly them there non-stop,” added Gokongwei.

Gokongwei cited Saudi Arabia as an example, where only 165,000 passengers flew direct non-stop flights from Manila (Civil Aeronautics Board 2010 data), compared to 293,000 Filipinos deployed to Saudi Arabia in the same year. This means that nearly half of Filipinos who flew to Saudi Arabia in 2010 had to take multiple flights to get to their destination. With CEB’s long haul operations, the budget airline will provide more affordable, direct flight options to Filipinos overseas, a population estimated to be 11 million worldwide.

Since its inception in 1996, CEB has posted a good track record in stimulating short-haul travel of Filipinos working and residing overseas. Passenger traffic to and from Hong Kong, where a lot of Filipinos reside and work, grew by 88% since CEB started operating flights from Manila in 2001.

“We want to do the same for long-haul traffic --- offer the lowest fares possible and drive a significant increase on demand for air travel to regions outside of Asia. This is truly an exciting time for CEB as we continue to be of service to the 11 million strong global Filipinos, wherever they are in the world; and to their families back home,” Gokongwei said.

“As CEB develops long-haul routes and opens new destinations for a Philippine flag carrier, we will be creating an important enabler for increased trade, tourism and foreign investment.”

The airline currently operates 10 Airbus A319, 19 Airbus A320 and 8 ATR-72 500 aircraft. Its fleet of 37 aircraft – with an average age of 3.6 years – is one of the youngest aircraft fleets in Asia. Between 2012 and 2021, Cebu Pacific will take an additional 23 Airbus A320 and 30 Airbus A321neo aircraft.

CEB operates the most extensive network in the Philippines with 34 domestic destinations and hubs in Manila, Cebu, Clark and Davao. It also offers 19 international destinations, namely Bangkok, Beijing, Brunei, Busan, Guangzhou, Hanoi, Ho Chi Minh, Hong Kong, Incheon (Seoul), Jakarta, Kota Kinabalu, Kuala Lumpur, Macau, Osaka, Shanghai, Siem Reap, Singapore, Taipei and Xiamen.