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Business

New routes, new aircraft

Wearing his aviation hat, Cebu Pacific’s Lance Gokongwei has been prodding the Philippine government to ensure regional flight protocols are in place for the day when the national aviation infrastructure finally catches up.

MANILA -- Despite infrastructure shortfalls, Cebu Pacific, the largest budget carrier in the Philippines, is planning new routes around Southeast Asia as access to regional markets and secondary destinations opens up.

     Operated by Cebu Air, the airline aims to serve key Southeast Asian hubs like Bangkok and Singapore, as well as Hong Kong further afield, from secondary Philippine hubs like Caticlan, Cebu, Clark, Davao and Iloilo.

     "We have a lot of aircraft deliveries in 2017," Chief Executive Lance Gokongwei told the Nikkei Asian Review on Wednesday, saying that makes next year a likely launch period.

     The carrier expects delivery of five more Airbus 320s, 30 Airbus 321neos, and 16 ATR 72-600s between this year and 2021. The fleet already includes eight Airbus 319s, 33 Airbus 320s, six Airbus 330s and eight ATR 72-500s for a total of 55 aircraft.

     Cebu Pacific carried 13.7 million passengers from January to September last year, and currently flies to 11 Southeast Asian destinations, mostly out of its base in Manila. Traffic has been picking up in secondary Philippine cities where expansion of the outsourcing industry and steady overseas remittances have driven up disposable income.

     The Philippines is committed to creating an ASEAN single aviation market, which has resulted in a proliferation of traffic rights between secondary cities in the region. However, it has been prevented from ratifying protocols for more flights between ASEAN capitals by chronic congestion at Manila's Ninoy Aquino International Airport.

     The airport handles over 30 million passengers annually, but is inadequate for the growing demand in air travel. The government has been slow to address the bottleneck, and constant flight delays have sent airlines searching for alternative hubs.

     Gokongwei has meanwhile been prodding the government to at least ratify the agreements for open skies.

     "I think it is beneficial to the country as a whole to be part of a larger opportunity where you are opening up market access to many more countries," he said, adding that Cebu Pacific can compete regionally with Malaysia's AirAsia and Singapore's Tigerair.

     "If we want access to their markets, then we should be prepared to offer them access to our markets," said Gokongwei. The 49-year-old founded the airline in 1996, and also oversees Universal Robina, a family-controlled snack and beverage company operating in Southeast Asia, China and New Zealand.

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