Cebu Pacific shoots for record 24 million travelers in 2024

MANILA, Philippines — Low-cost carrier Cebu Pacific is poised to fly a record 24 million passengers this year, breaching its pre-pandemic high of 22 million, as the airline recovers its overseas market slowly but surely.

The largest carrier in the Philippines is confident that it will increase its passenger volume by 15 percent to an all-time high of 24 million this year from 20.87 million in 2023.

Cebu Pacific president and chief commercial officer Alexander Lao said the airline is managing its supply issues well, providing it with enough aircraft to connect to existing routes and reach new ones.

The airline is also gaining momentum in recovering its international market.

The full reopening of Hong Kong and the events campaign of Singapore are driving up local demand for roundtrip flights.

“We are way past COVID on capacity restoration, [as] we do expect to fly 24 million passengers this year. That is certainly above pre-COVID level because pre-COVID level is just 22 million,” Lao told The STAR.

The Gokongwei-led airline served a record 22.47 million passengers in 2019. It was eager to return to this level in 2023, but was hindered by the shortage in aircraft parts.

For this year, Cebu Pacific was expecting to park as many as 15 jets for the repair of jet engines in compliance with the recall issued by aviation supplier Pratt & Whitney.

Fortunately, the airline has grounded less than what was expected, minimizing flight disruptions and making room for expansion.

On top of this, Lao said Cebu Pacific is receiving its Airbus deliveries on time, allowing it to grow both its domestic and international networks.

The airline expects to take in 18 aircraft this year and has accepted five as of May.

“One, the issue with Pratt & Whitney has been better managed this year. We have less aircraft on ground than expected. Second, we continue to take aircraft delivery this year. We are expected to take in 18 deliveries, and we already have five to date,” Lao said.

Overseas, Cebu Pacific started mounting flights to Da Nang in 2023, allowing it to cover all bases in Vietnam, as the airline connects to Hanoi and Ho Chi Minh as well.

By August, Cebu Pacific will begin flying to Kaohsiung, one of the cities to the south of Taiwan, serving the route thrice a week, every Monday, Wednesday and Friday.

From a price point of view, Lao said Cebu Pacific should be able to outlast its competitors in an inflationary environment through the low-cost model that it employs.

Inflation has gone upward since slowing to 2.8 percent in January, ballooning to 3.4 percent in February, 3.7 percent in March and 3.8 percent in April. The government hopes to contain inflation between two percent and four percent in 2024.

“In an inflationary environment, people are looking for more affordable options, so maybe that is what is driving our strength. Especially on domestic (flights), we do see our domestic bookings to be still strong,” Lao said.

As a result of strong demand, Cebu Pacific’s parent Cebu Air Inc. doubled its net income to P2.2 billion in the first quarter from P1.08 billion a year ago.

Revenue picked up by more than a fifth to P25.3 billion, as income from the passenger business hit almost P18 billion due to the air travel spike during the New Year season and Lenten period.

Cebu Pacific has allocated P48.7 billion for capital expenditures in 2024 and plans to spend the bulk of the amount on aircraft deliveries.