BIG DEAL The budget carrier plans to secure either Airbus’ A320 and A321s or Boeing 737s. —FILE PHOTO
MANILA – Budget carrier Cebu Pacific is embarking on an ambitious plan to triple its passenger volume in the next decade, and to support this growth, it intends to order 100 to 150 new aircraft worth approximately $12 billion from leading manufacturers Airbus or Boeing. This order, set to be placed on Friday, will be the largest in Philippine aviation history.
The CEO of Cebu Pacific, Michael Szucs, revealed in an interview with the Inquirer that the airline will evaluate proposals from both Airbus and Boeing before the end of the year, with the aim of selecting the supplier that offers the best economic outcome. The desired aircraft models are Airbus’ A320 and A321 units or Boeing 737s.
“May the best man win,” said Szucs, highlighting the competitiveness of the selection process.
The initial batch of aircraft is expected to be delivered by 2027, with the remainder arriving by 2035. If Boeing secures the contract, it will mark a significant milestone for Cebu Pacific, which currently only operates Airbus units.
Retirement
As part of Cebu Pacific’s expansion plans, some of its existing units will be retired. The airline currently operates 70 aircraft, a number set to increase to 76 by the end of this year and 91 by 2024.
By 2035, Cebu Pacific aims to increase its passenger capacity to 60 million per year, nearly triple the projected 22 million for this year.
Mark Cezar, the airline’s CFO, stated that the pre-delivery payment will be financed with operating cash flow, and the remaining balance will be settled through various means, including financing. Cezar emphasized that capital market fundraising will not be necessary for this aircraft order.
Szucs expressed optimism for the aviation sector as the government focuses on developing regional airports outside Manila, which will further support air travel growth. Cebu Pacific is also considering the establishment of bases in Kalibo and Bohol, among other locations, where airports are undergoing upgrades.
Szucs added that the growing middle class and young demographics in the Philippines will contribute to the increasing demand for air travel.
Despite the positive outlook, Szucs acknowledged that supply chain issues, such as the shortage of spare parts, have affected operations. Currently, five of the airline’s aircraft are still grounded for maintenance.
Cebu Pacific’s network currently covers 35 domestic and 23 international destinations.
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