Cebu Pacific has confirmed the start of a new Melbourne service is imminent as it revealed its Manila-Sydney service is expected to become profitable in 2016.
The airline launched Sydney services in September 2014 and has already become the largest carrier on the route. Department of Infrastructure and Regional Development figures for September showed the airline had 40% market share.
“More interestingly, the market has actually grown quite a bit compared to September 2014 when we started flights,” manager Alex Reyes told Travel Weekly. The same report showed total traffic on the route of 25,948 for September 2015, up from 17,307 in the same month the previous year.
“That’s around 50% stimulation – not too many long haul routes have been able to grow 50% in one year,” Reyes said.
“We like to enter routes that we feel are underserved so when we come in with fares that are lower by 30 to 40%, we know there will be a huge jump in traffic. Sydney lived up to the profile we established for it.”
Although Reyes reported some strong months in Cebu’s first year on the route, it did not finish the year as profitable. However, he expects that to occur in 2016.
“It is going quite well as we speak, and moving forward, we expect 2016 to be profitable on a full year,” he said.
Meanwhile, Cebu is working hard on its plans for Australian expansion, with Melbourne next on the agenda.
“We are quite active in air talks between the Philippines and Australia – we are asking the government to ensure there are enough air rights to allow us to grow,” Reyes said.
“We have made the necessary applications to start service to Melbourne, we are just waiting for a few more approvals on the Philippines side.”
However, he anticipated the service would start in 2016.
“Melbourne also profiles quite similarly to Sydney – we feel it is underserved.”
More Australian expansion is on the cards in 2017, Reyes revealed, as the airline takes delivery of new A321neo aircraft
“With that aircraft, we can actually add a few more destinations,” Reyes confirmed. “There are going to be a lot more viable routes with the A321neos. The A330 has too much capacity, but the A321neo is perfect for the market size.”
The next year will see Cebu continue to work with the Philippines Department of Tourism to grow the market for travel to the destination. While Boracay remains the airline’s number one destination for Australian travellers, Reyes revealed, Puerto Princesa on the island of Palawan is growing in popularity thanks to attractions such as its UNESCO-listed subterranean river.
Stopovers in Manila are also a popular option for Aussies, he added.