New CEB routes ‘fuel tourism development’

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Wednesday, August 20, 2014


CEBU is becoming a top gateway to smaller island destinations in the country, officials of Cebu Pacific (CEB) noted, with 29 of its routes flying out of its Cebu hub.

CEB director for corporate finance and investor relations Trina Asuncion told reporters Monday that their new routes have fueled tourism development in smaller cities and that they intend to add more flights out of Cebu to leisure island destinations within the year. They recently added Cebu-Tandag-Cebu last June, bringing to 23 the number of domestic routes it offers from Cebu. They have six international routes out of Cebu.

Cebu Pacific held its stockholders’ meeting in Cebu for the first time, in compliance with a Securities and Exchange Commission regulation requiring companies to hold such meetings in the registered principal place of business.

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Asuncion said Cebu domestic travel has grown 20 percent in the second quarter, which they credit to the new destinations that fly out of Cebu.

Asuncion added that they expect this year to be favorable in terms of competition, saying having three local carriers is healthy rather than having many competitors. CEB formed a strategic alliance with Tiger Air Philippines, leaving them competing with Air Asia Zest and Philippine Airlines. She explained that having too many local players makes too many seats available and makes companies scramble for the customers.

It also means more carriers operating out of airports, adding to congestion, and leads to a shortage of pilots.

With fewer local players, she said carriers have a more “balanced structure” while the European Union ban lifted from CEB allows them to be in a strong position to explore new markets.

She also noted a strong demand for travel, as 24 percent of seats have been sold in the next three months.

CEB’s alliance with Tiger Air Philippines brings their domestic market share for the second quarter to 61.6 percent, with CEB dominating the market at 55.3 percent and Tiger Air contributing 6.3 percent. They now have 59 domestic routes to 34 destinations and 1,997 flights weekly.

For international flights, CEB reported having a 16.5 percent share of the international market and 25.3 percent on the routes they operate. Their largest markets are Singapore, Hong Kong and Korea. They now have 36 routes to 27 destinations and 426 flights weekly.

They currently do not have long haul flights out of Cebu, saying they have not received requests for this yet. However, Asuncion said this may still be a possibility as they study what other destinations they can offer. In choosing long haul international destinations, they consider the concentration of overseas Filipino workers.

Published in the Sun.Star Cebu newspaper on August 21, 2014.

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