Philippines low-fare airline Cebu Pacific is on a growth path, with massive fleet and network developments under way – and sustainability at the root of its plans. Emma Kelly reports on the latest news from the dynamic carrier.
This article, “Pacific Highway” was originally published in the April/May 2025 issue of LARA, and all information is correct at the time of the article being published. To receive more articles like this, apply for your complimentary subscription to LARA.
Cebu Pacific – Post-Covid recovery for the low-fare carrier
While some carriers in the Asia-Pacific region were slow to bounce back after the pandemic, the same cannot be said for Cebu Pacific. The Philippines-based low-fare carrier has had two years of substantial growth, with more to come.
New routes, a new fleet, along with sustainability, technology and passenger experience initiatives are all aimed at cementing its position, connecting passengers throughout the Philippines and the wider Asia-Pacific region – or, as Cebu Pacific likes to say, making air travel accessible for “every Juan”, meaning all Filipinos.
The carrier currently operates 18 Airbus A320ceos, 21 A320neos, seven A321ceos, 19 A321neos and 10 A330neos, with regional subsidiary Cebgo operating 15 ATR 72-600 turboprops. Some 17 aircraft were delivered last year, with a further seven due to come on line this year – one A321neo, two A320neos and four A330neos.
Cebu Pacific operates the largest network in the Philippines, serving 37 destinations, along with 26 international routes across Asia, Australia and the Middle East – Sydney and Melbourne in Australia; Brunei; Guangzhou, Shanghai, Xiamen in China; Hong Kong; Bali and Jakarta in Indonesia; Fukuoka, Nagoya, Tokyo (Narita), Osaka (Kansai) and Sapporo (New Chitose) in Japan; Seoul (Incheon); Macau; Kuala Lumpur; Singapore; Kaohsiung and Taipei in Taiwan; Bangkok (Suvarnabhumi Airport and Don Mueang Airport) and Chiang Mai in Thailand; Da Nang, Hanoi and Ho Chi Minh in Vietnam; and Dubai.
Further route development is on the cards, both domestic and international. The airline recently announced new direct flights from Clark International Airport to El Nido and Coron (Busuanga), due to start at the end of March, providing travellers from Northern and Central Luzon with greater access to some of the Philippines’ most stunning island destinations.
The airline says: “We continue to evaluate opportunities for further [domestic] expansion, with a focus on enhancing connectivity across the country.”
This includes investigating further expansion of operations in regional hubs outside Manila, with regional hubs in Cebu, Clark, Davao and Iloilo.
Fleet development – Fuel-efficient fleets and expanding international routes
In terms of international route development, 2024 was a busy one for Cebu Pacific, with the launch of direct flights to nine international destinations, with most operating from hubs in the Visayas-Mindanao region.
This year, the airline plans to launch direct flights from Iloilo on Panay Island to Bangkok, and Cebu to Ho Chi Minh City.
A massive fleet development programme is under way, for both replacement and expansion.
Last October, the airline signed a binding memorandum of understanding with Airbus for the purchase of up to 152 A321neo aircraft, including firm orders for up to 102 A321neos, with purchase rights for an additional 50 A320neo family aircraft.
Under the agreement, Cebu Pacific has a minimum commitment of 70 aircraft, with the flexibility to secure additional delivery slots in the early years, subject to certain conditions. Firm deliveries are set to begin no later than 2029.
The airline says the order will support both fleet expansion and replacement, with the aim of transitioning to an all-neo fleet, ensuring greater fuel efficiency and operational reliability. The aircraft will be deployed across its hubs.
Xander Lao, Cebu Pacific’s President and Chief Commercial Officer, says: “With the added capacity, we can expand our network and enhance connectivity, allowing more travellers to reach destinations across our archipelago and beyond.”
As a long-term Airbus operator, Cebu Pacific considered “a highly competitive offer” from Boeing for its fleet order, but Lao concedes that Airbus provided “the most advantageous deal”. There was also the added bonus of A320neo family familiarity, allowing for greater operational efficiency and seamless integration.
Regional connectivity – Accessible island travel with expanding Cebu Pacific’s network
Recent growth has also occurred through acquisition, with Cebu Pacific buying local ATR operator AirSWIFT last October in a PHP 1.75 billion (USD 30.24 million) deal.
As a domestic leisure carrier, AirSWIFT currently operates two ATR 42-600s and three ATR 72-600s from Manila’s Ninoy Aquino International Airport (NAIA) and Clark International Airport.
The acquisition has allowed Cebu Pacific to further strengthen its regional connectivity, including expansion to El Nido Airport on Palawan Island, with AirSWIFT previously being the only airline operating to the airport.
Palawan Island welcomed approximately 500,000 tourists in 2023, attracted to its beautiful white sand beaches and coral reefs. The acquisition was “a strategic move to further develop access to this premier destination”, says Lao.
He adds: “Tourism remains a vital part of our economy, and Cebu Pacific is committed to investing in robust markets like El Nido. Coupled with ongoing airport improvements, this acquisition positions us to drive growth and improve accessibility in key leisure destinations.”
The acquisition also brings synergies and cost-saving opportunities with Cebgo’s turboprop operations.
For the time being, at least, AirSWIFT operations will remain separate from Cebgo.
“When we took over AirSWIFT, our top priority was ensuring business as usual for its customers,” says Lao. “For now, we are not making any changes to its network or operations, as it is critical to avoid disruptions or confusion.”
Cebgo itself has recently expanded its operations, with direct services added to Palawan destinations Coron (Busuanga) and El Nido.
Meanwhile, its Manila operations are set to be transferred from NAIA to Clark International Airport as per a directive issued by the Manila Slot Co-ordination Committee at the end of last year.
All turboprop operations, including Cebgo’s, are required to gradually transfer from NAIA Terminal 2 to nearby airports.
From 30 March, Cebgo flights from Manila to Masbate and Siargao were due to operate from Clark International, while direct services from Manila to Surigao were being discontinued, with passengers having the option to connect via Cebu.
“With the added capacity, we can expand our network and enhance connectivity, allowing more travellers to reach destinations across our archipelago and beyond.”
Xander Lao,President and Chief Commercial Officer, Cebu Pacific
Financial turnaround – Post-pandemic revenue recovery by the Peso (PHP)
Financially, 2023 was a turnaround year for Cebu Pacific following the pandemic, reporting a return to profit in March 2024.
Revenues climbed 60 per cent year-on-year to PHP 90.6 billion on the back of a recovery of operations, with 20 million passengers carried on 140,000-plus flights – up 41 per cent and 30 per cent respectively on the previous year.
The airline reported an operating income of PHP 8.6 billion and a net income of PHP 7.9 billion.
Results in 2024 have been impacted by growing fleet costs and expansion. By November, it reported nine-month revenues up 11 per cent on the previous year, to PHP 74.5 billion. That increase was driven by passenger growth, with 17.5 million passengers flown – up 13 per cent year-on-year.
Operating income was eight per cent down, however, to PHP 5.7 billion, while net income dropped 33 per cent to PHP 3.4 billion. The results were impacted by a jump in costs, particularly investment in new aircraft.
Cebu Pacific ended that quarter with a fleet of 91 aircraft – 10 more than the previous year – as well as an additional 10 spare engines to sustain growth and improve operational reliability.
The airline was one of many impacted by Pratt & Whitney PW1100G engine issues, which resulted in aircraft on ground.
On the upside, passenger demand is clearly there. In 2024, Cebu Pacific carried 24.5 million passengers, with the year also seeing the airline fly its 250 millionth passenger.
This year, the airline says it expects to grow its passenger numbers by at least 20 per cent.
In January 2025 alone, the airline carried 2.6 million passengers – 33.4 per cent up on January 2024 – with seat capacity climbing by 31.2 per cent and seat load factor rising from 85.1 to 86.5 per cent.
Domestic passenger traffic rose 34.6 per cent, while international traffic climbed 29.9 per cent year-on-year.
Growing pains – Addressing the global airline pilot shortage
With growth comes challenges. The ongoing pilot shortage issue is clipping the wings of some airlines.
Cebu Pacific is aiming not to be one of these carriers, with the creation last year of its own cadet pilot programme, with the aim of training 60 cadets annually.
To support its recent aircraft orders, the airline says it will require an average 100 new pilots annually.
The programme, in conjunction with Cebu-based flight training school Airworks Aviation, is a 96-week self-funded programme that guarantees employment with the airline at the end.
Cadets start with a four-week Aviation Foundation Course in Pasay City, Metro Manila, followed by 68 weeks of basic flight training with Airworks at Mactan International Airport in Cebu. The course is completed with 24 weeks of Airline Integration Training in Manila.
In late February, the airline had three batches of cadets training with Airworks, following an “exceptional response” that it attributes to clear career progression, competitive benefits and a supportive culture.
Climate commitment – Cebu Pacific’s sustainability initatives
While continued growth is on Cebu Pacific’s agenda, doing so sustainably is a priority.
“Sustainability is not just a checkbox for us,” says Lao. “It’s a commitment we take seriously. As the aviation industry evolves, we fully recognise the responsibility we bear – not only to our passengers, but also to the communities and ecosystems affected by air travel.”
Sustainability initiatives have been implemented across the group’s operations – from operating one of the youngest fleets in the world (six years), and investing in new aircraft to enable emissions savings, to deploying electric baggage tractors and responsible waste management.
Cebu Pacific’s fleet renewal programme alone will deliver significant benefits. By mid-2024, when 43 per cent of its fleet comprised neo aircraft, this resulted in a 161,000 tonnes reduction in carbon emissions compared to its earlier generation Airbus fleet.
This figure will continue to improve as the airline moves towards an all-neo fleet. In addition, 16 million kilograms of jet fuel had been saved through flight optimisation and fuel efficiency best practices, further reducing carbon emissions by almost 51,000 tonnes, according to the airline.
Sustainability initiatives are also growing on the ground. Late last year, the airline deployed 13 zero-emission electric baggage tractors at terminals two and three at NAIA, replacing fuel-powered tractors.
Meanwhile, its main APlus and Air Juan buildings, which house its maintenance, ground handling and catering operations, are now powered by 100 per cent renewable energy.
These initiatives helped Cebu Pacific record in 2024 its lowest carbon emission intensity since 2019, reporting 80 grams of carbon dioxide per revenue passenger kilometre (RPK). This compares with the global airline average of 90 grams per RPK.
The airline also achieved in 2024 its highest environmental, social and governance (ESG) ratings from MSCI and S&P Global.
From global investment specialist MSCI, it achieved an AA rating (AAA being the top), an improvement on its A rating of 2023.
Cebu Pacific is one of only two companies in the Philippines to achieve an AA rating, it says.
The carrier’s S&P ESG ranking climbed to 46, making it one of the world’s top airlines for sustainability. Cebu Pacific also achieved a 17-point increase in its environmental score – to 43 points – thanks to its decarbonisation efforts, with further initiatives in the planning stages.
The airline says: “Sustainability is a core priority for Cebu Pacific, as we recognise our responsibility to minimise environmental impact while keeping air travel affordable.
“Our goal is to further integrate sustainability, not just in-flight but also on our ground operations so we can continue to provide affordable flights while contributing to a more sustainable future.”
Satisfied customers – Improving passenger experience with AI and onboard upgrades
In commercial aviation, growth is often accompanied by customer service issues, an area Cebu Pacific is keen to address.
Last year saw Cebu Pacific record its lowest carbon emission intensity since 2019. Image: Cebu Pacific
The airline says its satisfaction score in 2024 was +28 – double the previous year’s rating – while its on-time performance for February shows a slight improvement on January to 73.86 per cent. To further improve the customer experience, Cebu Pacific has partnered with artificial intelligence customer service specialist Ada on a generative AI agent to provide instant and human-like responses to passengers.
Operating 24/7, the new AI agent is initially automating common inquiries involving flight bookings, itinerary changes and travel document requirements.
There are plans to take the technology further, however, including proactive notifications, multilingual support and recommendations.
Meanwhile, onboard catering has been upgraded, with new dishes added to the airline’s Fun Café menu, for purchase on board during the flight rather than having to pre-order 24 hours before departure.
While other LCCs have added in-flight entertainment and connectivity, Cebu Pacific says no formal decisions have been made, but it is “open to exploring opportunities”.
With other airlines having drifted away from the LCC model, Cebu Pacific says it plans to stay true to its roots.
Lao tells LARA: “The LCC model is the ideal fit for the Philippines and the markets we serve, particularly within the four-hour flying radius from Manila, which encompasses a population of over two billion people. This approach is especially suited for short-haul travel, where affordability and safety are important for our customers.”
While it operates a few long-haul routes – Dubai, Melbourne and Sydney, for example – Cebu Pacific’s focus remains on short-haul travel.
“We aim to provide a reliable and cost-efficient way of taking people from point A to point B,” says Lao. “This objective hasn’t changed, as the opportunity within the region remains immense.”
The Philippines’ robust economy and infrastructure development continues to support demand for affordable air travel.
“Staying true to the LCC model allows us to continue serving this growing market effectively while ensuring travel remains accessible to as many people as possible,” says Lao.
Good news for every Juan.
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