News

Cebu Pacific plans extensive expansion

25 Oct 2012

Cebu Pacific, the Philippines’ low-cost carrier (LCC), is planning a significant expansion of its network in the next 12 months, increasing the number of regional cities it links and launching long-haul flights. 

Long haul 

Candice Iyog, vice president for marketing and distribution at Cebu Pacific, said the airline expects to start long-haul flights in the latter half of 2013 when it receives the first two of eight A330 aircraft on order.

Iyog said the airline had not yet finalised destinations, but these will be selected based on whether or not they have a large overseas Philippine population to serve, much like the carrier’s current destination to Hong Kong.

“For our first long-haul flight, it’s the same strategy,” she said. “We are looking at long-haul markets where there is a large Philippine population, so that narrows it down to just a handful of choices.”

She added the options they were looking at were the Middle East, the US, Australia, and some parts of Europe. The Middle East, she said, has 4 million Philippine residents, over half of which must make more than two connections to fly to the Philippines. 

Iyog said Cebu Pacific was confident it could succeed in the long-haul market, where other LCCs such as AirAsia X have struggled, because of its business strategy catering to this large overseas population.

“Unlike a lot of other markets or countries where there are LCC carriers, a tenth of our country’s population – or 11 million people – actually don’t live in the Philippines, they are all over the world,” she explained.

As with the rest of Cebu Pacific’s flights, the long-haul aircraft will be all economy class and will be no-frills, with hot food and wifi offered as paid for extras. Iyog said the seats will be new, slightly lighter and more comfortable, but otherwise the same as the current ones. For in-flight entertainment they would follow the same approach of offering connectivity, not products.

“It’s the same product as what we have for short haul,” she said. The fares would “definitely be less than market prices today”, she added. 

Regional expansion 

Regionally, Iyog said the airline will also continue to expand its network:

“The plan is to continue expanding,” she said. “We are expecting another 50 aircraft between now and 2021. Thirty of those aircraft are A321neo’s which will seat 220 people. We will definitely be using that for flying within the region, as it’s more fuel-efficient. This means we will be in the best position to continue offering lower fares on a per seat basis.” 

Rendering of the fuel-efficient A321neo aircraft

She said the airline planned to stay centred in the Philippines rather than forming hubs in other places. The Philippines, she explained, is geographically well placed to be a connecting point for north and south Asia. 

As well as some new destinations, the airline’s expansion will focus on new city pairings. In November, for example, the airline will start flights between the central Philippine city of Iloilo and both Hong Kong and Singapore. In December, it will start flights from Cebu to Singapore and Bangkok. 

Alongside overseas Philippine workers, which make up the bulk of the airline’s passengers, Iyog said there are also some business travellers. 

“There is business traffic, it’s not so much the corporate type of business it’s more entrepreneurs and SMEs, flying to Hong Kong, Singapore, Bangkok,” she said. This is particularly true of the Manila-Hong Kong route where the airline’s flight frequency offers the option of a same day return. 

In Autumn last year, the airline launched flights to Xiamen based partly on the large demand for business travel on this route. 

“There’s a lot trade happening between the Philippines and Xiamen,” she said. “There are Philippine businesses that actually have business in Xiamen as well.”

Currently, alongside Xiamen, the airline flies to the Chinese cities of Shanghai, Beijing and Guangzhou. Iyog said they would consider more destinations if they saw high demand.

For more information, visit www.cebupacific.com 

Nicholas Olczak

Loading comments...
Share with your friends










Submit
Be up-to-date
Magazine Subscription

To see our latest subscription offers for Business Traveller editions worldwide, click on the Subscribe & Save link below

Polls