Cebu Pacific (CEB) is confident with its plans to launch long-haul flights, announced earlier this week (see story here), despite scepticism and obstacles within the industry.
In its announcement last week, CEB expressed intentions to launch flights to Australia, Middle East, Europe and the US by the third quarter of 2013.
The first and most important hindrance to this plan, pointed out by the Business Traveller consumer editor, Alex McWhirter, would be the ban placed on several airlines from the Philippines – including CEB – by the European Union because they were deemed unsafe to fly in European airspace. Furthermore, the American Federal Aviation Administration (FAA) downgraded the Civil Aviation Authority of the Philippines (CAAP) to Category 2 because it does not comply with the minimum safety standards provided by the International Civil Aviation Organisation (ICAO). This means that while carriers from the Philippines can still operate in the United States, they will be subject to “heightened FAA surveillance.”
However, CEB seems confident that it will overcome these issues. A spokesperson from the carrier stated that the CAAP is currently undergoing “an extensive process of improvements, especially in technical training. The authority has received a lot of support from many airlines and ICAO experts in technical training. We are confident that the government and Philippine carriers are taking all necessary actions to lift the EU ban and the US FAA CAT 2 status in the soonest possible time.” Till then, the carrier strives to expand its network in other regions, such as the Middle East and Australia.
McWhirter stated that another significant issue with CEB’s plan is the fact that "the long-haul, low-cost model has, so far, been proven not to work," with the weight of rising oil prices and taxes administered in Europe, such as the Air Passenger Duty in the UK. The most recent example of this was AirAsia X’s decision to cease flights to London Gatwick (see story here).
The airline says it can make these routes profitable by specifically targeting the overseas Filipino workers. “Recent government statistics estimates that there are about 11 million OFWs. In most countries where most Filipinos are largely deployed, direct flight services are not available,” explains CEB’s spokesperson.
“Only two out of the top 10 medium- to long-haul markets where Filipinos are deployed are served by home based carriers – Los Angeles and San Francisco. This means that most OFWs fly circuitous routes. We see great potential in filling that void.”
The carrier has yet to announce new destinations but one can only wait and see the feasibility of this carrier’s growth strategy. Hopefully, its long-haul network will match the success of its regional network, which has so far expanded to 19 destinations.
For more information, visit www.cebupacificair.com
Alisha Haridasani
