Cebu Pacific to launch US operations through Guam

by Lorenz S. Marasigan, BusinessMirror

Posted at Aug 19 2014 09:18 AM | Updated as of Aug 19 2014 05:19 PM

MANILA, Philippines - The airline of taipan John L. Gokongwei will soon serve the Filipino market in the United States, an aviation think tank said, as it aggressively expands its long-haul operations to compete with rival flag carrier Philippine Airlines (PAL).

Likewise, the long-haul operations of Cebu Pacific in the United Arab Emirates (UAE) will be increased by three new destinations.

The Center for Asia-Pacific Avia-tion (Capa) sees Cebu Pacific expanding its long-haul destinations to include Guam, Honolulu, Sharjah, Dammam and Riyadh.

This was confirmed by Cebu Pacific Long Haul Division General Manager Alex B. Reyes in a phone interview.

“Since we started our long-haul operations, we announced that we are interested in markets that have a huge concentration of Filipinos, such as Saudi Arabia and the US,” he said late Monday.

‘Further growth’

Reyes said Cebu Pacific plans to enter the US market initially through Guam and Hawaii.

“We applied for our operating permit to fly to the US two months after the FAA [Federal Aviation Authority] lifted our status to Category 1,” Reyes said.

He stressed that the application came after the firm received the economic clearance from the US Department of Transportation to operate flight services to Guam, Saipan, Honolulu, San Francisco and Los Angeles.

“We are particularly interested in two of those destinations: Guam and Honolulu. We want to reach destinations through nonstop operations via our Airbus A320 for Guam and Airbus A330 for Honolulu,” Reyes noted. He, however, did not give a definite timeline for these expansion plans.

But in the analysis, independent aviation market-intelligence provider Capa said the largest Filipino low-cost carrier plans to launch Guam services by year-end.

“Honolulu will take slightly longer to launch as Cebu Pacific first needs to secure extended range twin-engine operations approval for its A330 fleet,” the think tank said.

The Hawaiian destination, the market-intelligence provider said, will be challenging from a competitive standpoint given the plans of PAL to expand its Manila-Honolulu flights to seven from four times weekly even before the foray of Cebu Pacific into the market.

To expand gulf services

Aside from the potential entry of the budget carrier into the US market, Cebu Pacific is also mulling over the addition of three new destinations to its gulf services.

Reyes pointed out that the high concentration of overseas Filipino workers attracted his airline to consider expanding its operations in the Middle East.

The aviation think-tank noted that Cebu Pacific originally was looking at supplementing Dubai--its first and only service in the Middle East--with Abu Dhabi, but now sees more potential in Sharjah, partly because of the connection opportunities with Air Arabia.

“Cebu Pacific, however, first needs to secure additional UAE traffic rights before a service to Sharjah can be added. Cebu Pacific has long pushed Philippine authorities to adopt a policy of prohibiting Filipino carriers from loaning their traffic rights to UAE carriers,” Capa explained.

Increase aircraft fleet

The budget carrier is reviewing the prospect of acquiring wide-bodied aircraft such as the Airbus A350, Boeing 787 and the Boeing 777, Capa said.

Sought for comment, Reyes replied that the airline is continuously studying opportunities for further growth, both in terms of destinations and aircraft fleet.

“We are always evaluating aircraft acquisition since we are in constant touch with airframe manufacturers,” he said.

Cebu Pacific has a 50-aircraft fleet, and by 2021, 43 new aircraft from plane manufacturer Airbus will be acquired by the carrier.