Monday, 29 March 2010

Cebu Pacific ready for competition from Tan’s Air Philippines

Joel B. Escovilla

DAVAO CITY -- Cebu Pacific is undaunted by the plan of Lucio C. Tan’s Air Philippines to challenge its dominance in the budget-carrier market.

“Competition is good because this results in more vibrant airline industry, and ultimately, lower fares for the public,” said Candice A. Iyog, Cebu Pacific vice-president for marketing.

She said the company is comfortable with the pace it is setting and the Gokongwei-owned airline intends to increase its fleet size to support overseas expansion. The company is targeting to serve more than 10 million domestic and regional passengers this year.

In an earlier BusinessWorld report, an executive of Air Philippines, who asked not to be identified, said the firm wants to compete with Cebu Pacific head-on by serving new routes and buying more planes.

In line with its goal, Air Philippines has leased two Air Bus A320s. Also in the pipeline is the purchase of six more passenger airplanes.

By March 31, Air Philippines will have opened the Iloilo, Bacolod, Palawan, and Cagayan de Oro routes. When sought for a reaction on the direct challenge posed by Air Philippines, Ms. Iyog demurred: “We cannot comment on this as of this time.”

But Cebu Pacific, which boasts of low fares for domestic destinations, does not plan on letting go of its hold in the local market as it is scheduled to launch the Cebu-Pagadian (Zamboanga del Sur) route this April 27, followed by Manila-Pagadian flights on June 9.

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