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Low-cost airline of the Philippines From Wikipedia, the free encyclopedia
Cebu Air, Inc. (PSE: CEB), operating as Cebu Pacific (stylized in lowercase), is a Philippine low-cost airline based at Pasay in Metro Manila. Founded in 1988,[2] it is Asia's first low-cost airline and the Philippines' largest leading airline.[7][8][9] It offers scheduled flights to both domestic and international destinations. The airline operates flights from five bases in Cebu, Clark, Davao,[10] Iloilo, and its largest base in Manila.
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Founded | August 26, 1988[2] | ||||||
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Commenced operations | March 8, 1996 | ||||||
AOC # | 2009002[3] | ||||||
Operating bases | |||||||
Frequent-flyer program | Go Rewards | ||||||
Alliance | Value Alliance | ||||||
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Fleet size | 72 | ||||||
Destinations | 62 (including Cebgo) | ||||||
Parent company | JG Summit Holdings | ||||||
Traded as | PSE: CEB | ||||||
Headquarters |
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Key people | |||||||
Revenue | ![]() | ||||||
Operating income | ![]() | ||||||
Net income | ![]() | ||||||
Total assets | ![]() | ||||||
Total equity | ![]() | ||||||
Employees | 3,046 (2021)[5][needs update] | ||||||
Website | www | ||||||
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With its low-cost business model and extensive destination network, Cebu Pacific became the Philippines' largest airline based on number of passengers flown on domestic and international routes in 2010, overtaking rival Philippine Airlines (PAL). According to Civil Aeronautics Board data, Cebu Pacific flew 2.45 million total passengers in the first quarter of 2010, nearly 110,000 more than PAL, which carried 2.34 million systemwide during the same period.[11][12]
The airline has been criticized for its frequent flight delays and cancellations, as well as unsatisfactory service to passengers, prompting investigations by the Philippine government.[13]
Cebu Pacific was established on August 26, 1988. Republic Act No. 7151, which grants a legislative franchise to Cebu Air, Inc. to operate, was approved on August 30, 1991.[14] The airline began operations on March 8, 1996, with its first flight from Manila to Cebu. Domestic services began following market deregulation by the Philippine government. The airline was subsequently acquired by JG Summit Holdings, owned at the time by John Gokongwei.
The airline temporarily ceased operations in February 1998 after being grounded by the government following the crash of Cebu Pacific Flight 387 that killed 104, but resumed services later the next month following re-certification of its aircraft.[10] It initially started with 24 domestic flights daily among Metro Manila, Metro Cebu, and Metro Davao. By the end of 2001, its operations had grown to about 80 daily flights to 18 domestic destinations.
In the 2000s, Cebu Pacific was granted rights to operate international flights to the region, including Malaysia, Indonesia, Singapore, Thailand, South Korea, Hong Kong, and Guam. International flights were launched on November 22, 2001, with a twice-daily service to Hong Kong.[15] Thrice-weekly flights to Seoul commenced on March 1, 2002,[16] followed by Singapore on October 1.[17][18] Other regional flights were introduced and suspended later; however, including flights to Singapore (from November 6, 2002, to January 2003) and from Manila via Subic to Seoul (from December 2002) due in part to the effects of the SARS epidemic.[19]
On November 11, 2005, Cebu Pacific launched its "Go Fares" promo, reducing its air fares by half to increase the airline's revenue by twenty percent.[20] Following the move, the airline experienced significant passenger growth,[21] and Cebu Pacific President Lance Gokongwei anticipated the low fares would lead more people to travel by air.[20]
The airline resumed its Manila–Singapore flights on August 31, 2006,[22] and launched a direct flight from Cebu to Singapore on October 23. It was the first low-cost airline to serve the Cebu-Singapore-Cebu sector,[23] and competing directly with Singapore Airlines subsidiary SilkAir, the only Philippine carrier serving the route for years until Philippine Airlines resumed direct service in 2017. Cebu Pacific's direct Cebu–Hong Kong flights began on October 2, 2006, making it the Philippine carrier to serve the Cebu-Hong Kong-Cebu route after PAL terminated its direct service and began code-sharing with Cathay Pacific on the route.[24]
In November 2007, Cebu Pacific announced Francisco Bangoy International Airport in Davao City as its third base after Manila and Cebu. It opened on May 8, 2008, with the launching of direct services from Davao to Singapore, Hong Kong, and Iloilo.[25] In late 2007, Cebu Pacific announced plans to launch non-stop flights to the United States West Coast, Houston, and Chicago by mid-2009.[26]
Cebu Pacific's plans to begin international flights from Clark in 2007 were initially unsuccessful when its request was denied. The nations involved came to an agreement that Cebu Pacific would be only allowed to operate charter flights from Clark to the respective countries' airport(s). Only Singapore initially agreed to allow Cebu Pacific to fly scheduled flights from Clark.[27] After launching flights between Clark and Cebu in 2006,[28] on November 8, 2008, the airline commenced international flights from Clark to Hong Kong, Macau, Bangkok and Singapore, making Clark its fourth hub.[29]
On May 28, 2008, Cebu Pacific was named as the world's number one airline in terms of growth. The airline was also ranked fifth in Asia for Budget Airline passengers transported and 23rd in the world.[30] On November 20, 2008, it started operating direct flights to Japan, starting with Osaka (Kansai),[31] followed by Tokyo (Narita) and Nagoya in 2014,[32] and Fukuoka in 2015.[33]
In August 2009, Cebu Pacific became the first airline in the Philippines to use social media; the airline created a fan page on Facebook and Twitter.[34] In October 2010, the airline completed an initial public offering of 30.4% of outstanding shares, raising ₱23.3 billion prior to an exercise of an overallotment option.[35] By January 2011, the airline flew its 50 millionth passenger from Manila to Beijing.[36]
Cebu Pacific continued its network expansion in the 2010s. On August 2, 2012, the airline opened a base at Kalibo International Airport and launched direct flights from Kalibo to Davao and Puerto Princesa.[37] On November 8, it opened Iloilo International Airport as its fifth base, and direct flights were launched from Iloilo to Hong Kong, General Santos, Singapore, and Puerto Princesa.[38] That same year, Cebu Pacific planned to commence international long-haul flights to the Middle East, the United States, Australia, and parts of Europe using the Airbus A330-300.[39] It then began long-haul flights, starting with Dubai on October 7, 2013,[40] followed by Sydney in 2014 and Melbourne in 2018.[41][42]
By January 2015, the airline had flown over 100 million passengers.[43] On June 1, Cebu Pacific revealed its new logo that represents the colors of the Philippines and also symbolizes as an evolution of a low-cost pioneer.[44] The airline received its first Airbus A320 painted in the new livery on January 22, 2016.[45]
Cebu Pacific opened its seventh hub in Cagayan de Oro (Laguindingan Airport) on October 20, 2017, and launched direct flights to Dumaguete and Caticlan.[46] That same month, it flew its 150 millionth passenger.[47] In 2018, Cebgo, Cebu Pacific's regional subsidiary, launched flights to Basco, Batanes.[48]
The COVID-19 pandemic impacted the operations of the airline and its regional subsidiary. All operations were suspended during the enhanced community quarantine in Luzon in 2020. Due to low passenger demand, the airline laid off 1,300 employees that year,[49] and sent many aircraft to indefinite storage.[50] In 2021, Cebu Pacific raised a total of ₱40.5 billion (US$822 million) to help the airline recover from the pandemic.[51]
On March 8, 2021, Cebu Pacific celebrated its twenty-fifth anniversary.[52]
As travel demand recovers, it started rehiring retrenched employees in November 2021.[49] In March 2022, Cebu Pacific flew its 200 millionth passenger from Manila to Cebu.[53] By December 2022, the airline operated at 92% of pre-pandemic levels.[54] In early 2023, Cebu Pacific resumed flights to China.[55] On April 21, 2023, Cebu Pacific reopened its Pampanga hub at Clark International Airport.[56] That same year, after three consecutive financial years of losses, Cebu Pacific reported its first full-year post-pandemic profit.[57]
On February 28, 2024, Cebu Pacific was awarded the Best Airline award at the Routes Asia Awards 2024 for its "exceptional contributions to airport and destination marketing in the Asia Pacific region". It was also awarded Best Low-Cost Airline Brand and Most Sustainable Low-Cost Airline in the Philippines for 2023 by the World Economic Magazine.[58]
From March 1 to 9, 2024, to commemorate the Singapore stop of Taylor Swift's The Eras Tour, Cebu Pacific renumbered its Singapore flights as 5J 1989, in reference to Swift's fifth studio album, as well as its 2023 re-recording.[59]
As Cebu Pacific reduced its flights to China by the fourth quarter of 2024, it opted instead to begin flying to secondary cities in Southeast Asia, like Da Nang and Chiang Mai.[60] It also began flying to Don Mueang International Airport in Bangkok.[61]
Cebu Pacific is headquartered at the Cebu Pacific Building along Domestic Road in Pasay.[2] The airline is a subsidiary of JG Summit Holdings.
Cebu Pacific was the only Philippines-based member airline of Northwest Airlines' WorldPerks award travel program. WorldPerks offered regular travellers the ability to obtain free tickets, first-class upgrades on flights and other types of rewards. On August 1, 2006, Northwest and Cebu Pacific ended their mileage-accrual agreement.[citation needed]
On May 16, 2016, Cebu Pacific became a founding member of the world's largest low-cost carrier alliance, Value Alliance.[62] It joined other pioneer members Singapore's Scoot, South Korea's Jeju Air, Thailand's Nok Air and NokScoot, Tigerair, Tigerair Australia, and Japan's Vanilla Air in the low-cost carrier network.[63] Cebu Pacific is also currently the only Philippine carrier which is a member of an airline alliance.
Cebgo is the airline's regional subsidiary. It operates an all-turboprop fleet of ATR 72-600 aircraft and is used in regional domestic routes. It was founded in May 2015 following the acquisition of Tigerair Philippines by Cebu Pacific.[64]
Cebu Pacific Cargo operates two dedicated cargo turboprop aircraft. The airline announced in 2018 that it would enter the dedicated cargo market to support the increase in demand for logistics.[65]
Financial performance (PHP billions) | ||||||||||||||||
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Fiscal year | 2008 | 2009 | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 |
Revenue | 19.68 | 23.31 | 29.09 | 33.94 | 37.90 | 41.00 | 52.00 | 56.50 | 61.90 | 68.03 | 74.11 | 84.81 | 22.62 | 15.74 | 56.75 | 90.60 |
Expenses | 17.96 | 20.15 | 22.64 | 30.60 | 35.24 | 38.60 | 47.84 | 46.80 | 49.65 | 57.90 | 67.06 | 72.19 | 43.39 | 38.90 | 68.18 | 82.02 |
Operating income | 1.73 | 3.16 | 6.45 | 3.34 | 2.66 | 2.40 | 4.16 | 9.70 | 12.25 | 10.13 | 7.05 | 12.62 | −20.77 | −23.16 | −11.43 | 8.60 |
Net income | −3.26 | 3.26 | 6.92 | 3.62 | 3.57 | 0.51 | 0.85 | 4.39 | 9.75 | 7.90 | 3.92 | 9.12 | −22.24 | −24.90 | −13.98 | 7.92 |
Assets | 32.56 | 35.32 | 49.94 | 55.68 | 61.41 | 67.53 | 76.06 | 84.83 | 100.51 | 109.08 | 129.39 | 157.73 | 128.46 | 138.25 | 147.16 | 187.18 |
Liabilities | 28.56 | 28.06 | 32.03 | 36.51 | 39.37 | 46.45 | 54.52 | 59.87 | 67.00 | 69.29 | 89.29 | 112.83 | 105.77 | 127.64 | 150.04 | 182.41 |
Equity | 4.00 | 7.26 | 17.91 | 19.17 | 22.04 | 21.08 | 21.54 | 24.96 | 33.51 | 39.79 | 40.10 | 44.90 | 22.69 | 10.61 | −2.89 | 4.78 |
Operating highlights | ||||||||||||||||
Fiscal year | 2008 | 2009 | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 |
Passengers (million) | 6.67 | 8.76 | 10.46 | 11.93 | 13.26 | 14.35 | 16.90 | 18.38 | 19.13 | 19.75 | 20.28 | 22.47 | 5.03 | 3.41 | 14.85 | 20.87 |
Available seats (million) | 8.54 | 11.31 | 12.26 | 13.83 | 16.04 | 17.52 | 20.11 | 22.25 | 22.25 | 23.49 | 23.91 | 26.01 | 6.62 | 5.63 | 19.72 | 24.85 |
Load factor (%) | 78.10 | 77.45 | 85.32 | 86.26 | 82.67 | 81.91 | 84.04 | 82.61 | 85.98 | 84.08 | 84.82 | 86.39 | 75.98 | 60.57 | 75.30 | 84.00 |
RPK (million) | 5,653 | 7,056 | 8,860 | 10,531 | 11,533 | 12,927 | 16,213 | 19,872 | 21,220 | 21,301 | 21,736 | 24,883 | 5,275 | 2,479 | 11,870 | |
ASK (million) | 7,365 | 9,369 | 10,379 | 12,369 | 14,173 | 16,207 | 20,496 | 19,872 | 25,989 | 26,233 | 25,881 | 29,298 | 7,107 | 4,878 | 17,288 | |
Fleet size | 25 | 29 | 32 | 37 | 41 | 48 | 52 | 55 | 57 | 61 | 71 | 75 | 74 | 74 | 76 | 77[67] |
As part of the airline's modernization and environmental initiatives, Cebu Pacific is replacing its existing aircraft with new fuel-efficient aircraft specifically the Airbus A320neo family by 2028, marketing the initiative as a pathway to "Experience a Neo Way to Fly".[68] In addition, the airline used sustainable aviation fuel (SAF) initially on its delivery flights, before using SAF on a commercial passenger flight from Singapore to Manila on September 28, 2022, using an Airbus A321neo.[69] The airline also signed a five-year agreement with Shell Aviation that would supply 25,000 metric tons of SAF to Cebu Pacific.[70]
On November 3, 2022, Cebu Pacific received the Asia Environmental Sustainability Airline/Airline Group of the Year award from the Centre for Asia Pacific Aviation (CAPA) for its green initiative efforts in aviation industry.[71]
On October 19, 2023, Cebu Pacific signed another five-year agreement with Neste, one of the largest producers of sustainable aviation fuel.[72] The airline then completed its second SAF-powered flight on October 25, from Narita International Airport to Manila, also performed by an A321neo.[73]
On February 15, 2024, Cebu Pacific earned a Gold rating in the 2023 CAPA-Envest Global Airline Sustainability Benchmarking Report for integrating sustainable aviation fuel (SAF) in its operations and its outstanding performance in reducing carbon emissions. In addition to its CAPA Gold rating, CEB improved its S&P Global ESG Score to 41 in 2023 from 38 in 2022, ranking in the 69th percentile among the 63 airlines assessed by the international financial market intelligence provider.[74]
As of August 2024[update], Cebu Pacific operates an all-Airbus fleet composed of the following aircraft:[75][76][77]
Aircraft | In service | Orders | Passengers[78] | Notes |
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Airbus A320-200 | 20 | — | 180 | |
Airbus A320neo | 21 | 6 | 188 | |
Airbus A321-200 | 7 | — | 230 | |
Airbus A321neo | 15 | 110 | 236[79] | Aircraft in Airbus Cabin Flex (ACF) configuration. Additional order of 102 with 50 purchase rights across the A320neo family in July 2024.[80] |
Airbus A321XLR | — | 10 | TBA | Deliveries start in 2024.[81] |
Airbus A330-900 | 9 | 7 | 459 | Includes the Airbus A330-900 prototype (RP-C3906). |
Total | 72 | 133 |
Previously operating the McDonnell Douglas DC-9 and Boeing 757 aircraft, Cebu Pacific has transitioned to an all-Airbus fleet in 2006.
Turboprops were introduced to the fleet in 2007, when Cebu Pacific ordered six ATR 72-500 turboprop aircraft for its regional domestic flights.[82] By 2015, these were transferred to its regional subsidiary Cebgo, with Cebu Pacific operating mainly jet aircraft.[83][84]
On June 18, 2019, Cebu Pacific ordered 31 Airbus aircraft at that year's Paris Air Show, consisting of five more A320neos, sixteen A330neos, and ten A321XLRs, in a deal worth US$6.8 billion at list prices. This makes the airline as one of the few launch customers of the long-range narrow-body Airbus A321XLR aircraft.[85] These were ordered as part of its fleet modernization, seeking to replace its older fleet with newer, fuel-efficient aircraft.[85]
To prepare for the anticipated doubling of travel demand in Southeast Asia, Cebu Pacific sent requests for proposals to Airbus and Boeing in October 2023 for an order 100 to 150 aircraft.[86][87] On July 2, 2024, the airline announced that it signed a memorandum of understanding (MoU) with Airbus for the purchase of up to 152 aircraft—consisting of 102 firm orders for the A321neo and 50 purchase rights for additional A320neo family aircraft. This deal, worth US$24 billion (at list prices), was the largest order of any Philippine-based airline,[80] with deliveries starting not later than 2029.[88] The agreement would be completed by the third quarter of the same year.[80]
In 2004, Cebu Pacific signed a purchase agreement with Airbus for the acquisition of twelve A319s and the lease of two A320s to replace its existing fleet of Boeing 757 and McDonnell Douglas DC-9 aircraft.[89] It selected the CFM56 for its Airbus aircraft.[90] Cebu Pacific took delivery of its first A320-200 in May 2005, leased from CIT Aerospace.[91] The airline went on to order more A320s in the following years, raising its total orders to twenty-two by 2010.[92] The A320s supported the airline's expanding international and domestic operations.[93]
In July 2018, Cebu Pacific leased five Airbus A320neos from Avolon; the first of which was delivered in June 2019.[94] On December 19, 2019, Cebu Pacific finalized its order of five more A320neos after its order announcement in June.[81]
On June 30, 2023, the airline took delivery of its first Airbus plane assembled in China — an A320neo built at its final assembly line at Tianjin Binhai International Airport, leased from Clover Aviation Capital.[95]
To offset the grounding of its A320neo family fleet, on December 5, 2023, Cebu Pacific signed an agreement with Bulgaria Air to damp lease two A320ceos for use on domestic flights to Cebu and Davao City. These aircraft were in use from January 14 to April 30, 2024.[96]
In June 2011, Cebu Pacific ordered 30 Airbus A321neos including nine leased; the deal was finalized in August, with deliveries starting from 2017.[97]
On June 7, 2017, the airline ordered seven A321-200s to meet ongoing strong growth on its domestic and regional network,[98] as well as to offset the delivery delays of the A321neos due to problems with the Pratt & Whitney PW1100G-JM geared turbofan engines that would power the A321neos.[99]
Cebu Pacific took delivery of its first A321ceo on March 22, 2018,[100] followed by its first A321neo on January 20, 2019.[101] On December 19, 2019, Cebu Pacific finalized its order of ten A321XLRs after its order announcement in June.[81] On July 2, 2024, the airline ordered 102 more A321neos.[80]
In 2007, the airline ordered six Airbus A330-300s to operate long-haul Middle East destinations such as Dubai, East Asia routes such as Hong Kong, Seoul, and Tokyo, and Southeast Asia cities such as Bangkok and Singapore. It also been use in the domestic sector, mostly flights to Cebu, Davao, and General Santos. Cebu Pacific received its first A330-300 on June 15, 2013.[102] In 2016, the carrier then added two more A330s on its orders to complement earlier fleet in operating new long-haul routes, such as Sydney and Melbourne.[103]
On November 4, 2019, Cebu Pacific finalized its order of 16 Airbus A330neos to replace the Airbus A330ceos after its order announcement in June.[104] Leased from Avolon,[105] the first A330-900 was delivered on November 28, 2021.[106][107]
Aircraft | Total | Introduced | Retired | Replacement | Notes | Refs |
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Airbus A319-100 | 10 | 2005 | 2018 | Airbus A320neo family | Sold to Allegiant Air. | [108] |
Airbus A330-300 | 8 | 2013 | 2024 | Airbus A330-900 | Sold to multiple airlines. | |
ATR 72-500 | 6 | 2008 | 2015 | None | Transferred to Cebgo. | |
Boeing 757-200 | 3 | 2000 | 2006 | Airbus A320-200 | [89] | |
McDonnell Douglas DC-9-30 | 19 | 1996 | 2006 | Airbus A320-200 | One crashed as Flight 387. | [89] |
Cebu Pacific has been criticized for its poor passenger service, alleged overbooking, flight delays and cancellations.[109] For instance, the airline was also criticized for lack of coordination in the aftermath of the runway excursion incident at Francisco Bangoy International Airport in 2013 and the numerous flight cancellations and delays during the December 2014 Christmas peak season.[110]
In January 2018, Cebu Pacific was named as one of the world's least punctual airlines, with an on-time performance of 57.6 percent in 2017 based on data from OAG. Also included in the list from the Philippines is another low-cost airline, Philippines AirAsia, with an on-time performance of 58.0 percent.[111]
The airline was again criticized in 2023 because of its "unsatisfactory" service to passengers,[13] prompting the Senate of the Philippines to begin an investigation on June 21, 2023.[112]
In October 2010, a video uploaded to YouTube showing female flight attendants dancing to Lady Gaga's Just Dance and Katy Perry's California Gurls drew international attention. Despite its popularity, it was criticized by the Flight Attendants and Stewards Association of the Philippines (FASAP), referring it as "sexist and gender-insensitive".[113] That same month, the airline was criticized again for its dancing male crew.[114]