Cebu Pacific eyes No. 1 position in domestic carrier

Cebu Pacific Air (CEB), the Philippines’ second-largest airline, aims to be the country’s No. 1 domestic carrier in five years after its acquisition of 12 brand new Airbus 319 and the lease of two A320s from the European aircraft maker Airbus worth $670 million.

Cebu Pacific and Airbus signed the agreement Wednesday for the A319 jetliners.

The airline company would source 85 percent of the $350-million budget from an Export-Import Bank loan and the remaining 15 percent from internal funds and sale leasebacks.

Lance Gokongwei, CEB president said the aircraft will replace the 12 DC-9 aircraft, which are about 25 to 27 years old, adding “these aircraft is meant to make CEB the country’s No. 1 domestic carrier in five years.”

He said CEB already has 38 percent of the market share after only eight years of service and has the momentum to gain more market share and eventually the industry lead.

“We are growing fast and this would double our capacity in terms of more seats and flights. Once our re-fleeting is completed by early 2007, we shall have the youngest fleet in Asia, making us even more efficient and competitive,” he said.

He added, “We will remain on-time carrier. Our record is among the best in the world and way above the international norm. We want Cebu Pacific to be equated with punctuality wherever we fly.”

Gokongwei also said the re-fleeting program, aside from being a strategic corporate move, is also a vote of confidence in the country.

“We are committed to the Philippines. We want to be a partner in its growth. This huge investment will make travel and tourism a more vibrant sector. It would also help push trade since CEB would have a bigger capacity to move cargo,” he added.

“CEB is currently the biggest carrier from Cebu, flying within Visayas and Mindanao in a loop service for regional passengers and tourists. The Manila and Cebu hubs will see increased activity as CEB adds more local and foreign destinations to help spark a travel and tourism boom,” said Bong Mojica, CEB general manager.

Mojica said the new 150-seat A319 is among the quietest and the most fuel-efficient in its class. Fuel represents an airline’s single biggest operational expense item.

“The airports of General Santos City, Laoag, Cotabato, Legazpi, Dipolog, Clark and Subic are the only possible new destinations that we can fly to, as their facilities can handle the type of A319 and A320 aircraft.

For foreign destinations, Singapore, Seoul, Darwin, Tokyo, Bangkok, Hong Kong, Taipei and Burma are being targeted.

The first A319 will be delivered in September next year. The rest will follow in the interviewing period ending in February 2007.

The two 169-A320s will be delivered in the second quarter of 2005 and eventually replace the fleet of B757s, its current workhorse for its regional flights.

Cebu Pacific pioneered low fares and fun flights in the country in 1996. It will carry over 2.5 million passengers in 2004.