Cebu Pacific going into long haul travel in 2013

CEBU Pacific, in a bid to replicate its domestic success in the airline industry, will enter into long haul travel in the third quarter of 2013. To do that the no-frills airline will acquire eight wide-bodied A330-300 aircraft.
Lance Y. Gokongwei, CEB president and chief executive officer, said the plan is to capture the growing number of overseas Filipino workers, particularly those working in areas that are underserved by local carriers.
“We would like to offer (the opportunity for them) to come home (as many times as possible),” said Gokongwei, citing that in some long haul routes like Saudi Arabia, US and Europe, there are no direct flights.
This is the reason that the company is leasing the aircraft, at $220 million each, “all brand new” and can fly for 11 hours before refueling.
The company also chose the aircraft because Gokongwei explained, it will give the company “the lowest cost per seat,” he said, adding that the 16-year old company decided to acquire this type of aircraft because it will allow the company to “drive long haul fares 35% lower than those currently offered by other airlines.
Alex B. Reyes, company vice president for network and commercial planning, said the entry of the airline in the long haul market will also reduce fares from the average of about $1,000 a flight to even as low as about $500 a flight.
Reyes pointed out that this development will have a similar “Cebu Pacific effect” on the long haul travel like what happened in the domestic travel as well as the international short haul travel like the four points in Asia.
Reyes cited as an example the case of Singapore, Hongkong, Malaysia  and Taiwan,  the total seats of the company between them and the Philippines in 2005 were at about 250,000 seats. Last year, he added, the traffic was at  about 1.9 million.
“That goes to show that malaki ang tinaas namin,” he said. Gokongwei said the absence of local players in most international long haul routes pushed the company to venture into it. He pointed out that of the top 10 long haul routes, only two of them are being served by local airline. “Is there a market? I think so,” he pointed out Reyes pointed out that the company is looking at increasing traffic between the Philippines and the long haul markets from 400 passengers a day to about 700 a day.