Cebu Pacific Air’s long-haul unit is entering a new phase of growth which will also see it evolve to pursue more transit traffic. Cebu Pacific initially envisioned a pure LCC model for its long-haul low-cost unit, relying almost entirely on point to point traffic, but is now looking to build up connections, particularly to feed its new Manila-Sydney route.
In Sept-2014 Sydney and Kuwait will become Cebu Pacific’s second and third long-haul destinations after Dubai, where its performance has improved in recent months following a dismal start in 4Q2013. The carrier’s A330 fleet, which now consists of four aircraft with a fifth to be added by the end of Aug-2014, has until now been primarily used to upgauge short-haul routes.
The upcoming launch of services to Australia and Kuwait will be followed by Saudi Arabia in 4Q2014 and Hawaii in early 2015. Sharjah may also be launched in 2015 as Cebu Pacific considers leasing additional A330s.
This is the first in a two part series of analysis reports on Cebu’s now 14-month-old widebody operation. This part focuses on the new Manila-Sydney route and connection opportunities beyond Manila. The second part, to be published later this week, will look at Cebu’s plans for Saudi Arabia and the prospects of a Sharjah service. It will also examine the overall Philippines-UAE market including Cebu’s performance in Dubai.
The sixth and final A330-300 from Cebu’s current commitment with leasing companies is slated to be delivered in 1Q2015. This aircraft will support the launch of services to Honolulu, which Mr Reyes says will initially be served with three weekly flights.
Cebu Pacific is now working on securing FAA authority to operate flights into the US. Previously the carrier was unable to even seek such authority as the Philippines had a Category 2 safety rating. Philippine authorities secured a Category 1 rating in Apr-2014, enabling Philippine Airlines (PAL) to pursue expansion and gauge changes in the US market and enabling Cebu Pacific to begin preparations to enter the US market.
As previously outlined by CAPA, Cebu Pacific’s first US route will be Honolulu-Guam. Cebu Pacific plans to launch Guam by the end of 2014 using its A320 fleet. Honolulu will take slightly longer to launch as Cebu Pacific first needs to secure extended range twin-engine operations (ETOPS) approval for its A330 fleet. (Cebu Pacific is not seeking ETOPS for its A320s, which will necessitate a slightly longer routing to Guam in order to meet diversion airport requirements.)
Cebu Pacific is now evaluating the A330neo, which AirAsia X signed up for in Jul-2014 as the launch airline customer with 50 commitments. Cebu Pacific was already evaluating the A350, 787 and the 777X. The latter is still several years away but would enable flights from Manila to the west coast of the US, which have traditionally been PAL’s largest and most lucrative long-haul markets. Cebu Pacific does not see the A350 or 787 as a possibility for California (as the variants that may have the range are too small for Cebu’s requirement) but could use either type or the A330neo to pursue growth to the Middle East and Australia and replace current generation A330-300s.