Australia Flight Entitlements Increase, Cebu Pacific Wants More

Australia and the Philippines recently negotiated an updated air services agreement that will enable flights between the two countries to increase by 55 percent over the next year. Budget carrier Cebu Pacific has been eagerly anticipating the results of these negotiations as it seeks to expand its presence in the Australian market. 

cebu pacific sydney
Image Source: Cebu Pacific
The agreement was signed in Canberra, Australia on April 29. The updated pact will increase the number of seat entitlements between the two countries from 6,300 seats per week to 9,300 seats per week. 

According to Carmelo Arcilla, Executive Director of the Civil Aeronautics Board, Philippine carriers were already fully utilizing the Philippine entitlements prior to the updated agreement. Philippine Airlines currently offers 50 percent of seat capacity between the two countries with its flights from Manila to Sydney, Melbourne, Brisbane, and Darwin. 

With an estimated 400,000 Filipinos currently working in Australia, demand for travel between the two countries is expected to grow, especially as the Philippines grows in popularity as a tourist destination. Traffic between Australia and the Philippines increased by 10 percent last year, while tourists from Australia grew by 5 percent. 

According to Australia's Deputy Prime Minister, Warren Truss, increasing the number of flights between the Philippines and Australia will help to ensure that there is sufficient aviation capacity to meet future growth in demand. 

"This is an important and growing bilateral aviation market, growing at an average of 10.5 percent over the last five years," said Truss. "The new arrangements will allow this growth rate to continue for another four years, recognizing the potential of Australia as a prime tourism destination within the Asia-Pacific region."

In addition, the new agreement will allow third country code sharing, which enables designated carriers from both countries to operate services in conjunction with a carrier from a third country. "The settled arrangements expand code sharing opportunities for Australian airlines, providing potential for our airlines to expand their global networks and connectivity through cooperative marketing arrangements with overseas partners," Truss added. 

The airline expected to gain the most from the new agreement is Cebu Pacific, which has targeted expansion in the Australian market for the past few years. Cebu Pacific broke the Philippine Airlines-Qantas duopoly when it entered the Australian market in September of last year with four weekly flights between Manila and Sydney. 

Cebu Pacific currently operates the Sydney route utilizing the world's most densely configured Airbus A330-300 aircraft with 436 seats. 

Cebu Pacific's Chief Executive Advisor, Gary Kingshott, has been calling on the Australian government to lighten up and allow the budget carrier to increase service to Australia since last year. Kingshott was the former Chief Executive of Australian carrier Ansett International. 

The limits on air capacity apply only to Sydney, Perth, Brisbane, and Melbourne. Unlimited flights are available to smaller cities such as Darwin or Adelaide. 

In addition to offering daily flights to Sydney, Cebu Pacific is targeting new service to either Brisbane or Melbourne if it is able to offer daily flights. "We look forward to expanding our services and further growing inbound tourism into our countries," said Alex Reyes, General Manager of Cebu Pacific's Long Haul Division. 

Three months after it launched four weekly flights between Manila and Sydney, Cebu Pacific increased its service to five weekly flights. Before Cebu Pacific began operating the route, traffic between the two cities was growing at a compound annual growth rate of 8 percent over the past five years. 

Cebu Pacific's long-haul division is designed to stimulate the market and increase demand by offering low fares, which make flying more affordable even multiple times per year. According to the Australian Bureau of Infrastructure, Trade, and Regional Economics, passenger traffic on the Manila to Sydney route increased by 42 percent from September to December 2014, coinciding with Cebu Pacific's entry. "In the first four months of operations, Cebu Pacific's low fares and direct, non-stop services significantly stimulated inbound traffic into the Philippines and Australia," said Reyes. 

According to the Centre for Asia-Pacific Aviation, the Philippines is relatively underserved from Australia, when compared with other Southeast Asian markets. Prior to the agreement, there were only 5,800 weekly seats between Australia and the Philippines, compared to 36,000 for Indonesia, and 22,000 for Thailand. 

With the new agreement, it is believed that Cebu Pacific should be able to engage in the expansion that it seeks with service to Melbourne likely to launch after the carrier gets flights to Hawaii off the ground by the end of 2015. Although Cebu Pacific could have launched serviced to Melbourne alternative airport, Avalon, without impacting the capacity restrictions, the carrier has remained interested solely in Melbourne Airport. 

Cebu Pacific currently holds 30 percent of seat capacity between the two countries, while Philippine Airlines holds 50 percent, and Australian flag carrier Qantas holds the remainder. Cebu Pacific competes on the Manila to Sydney service with Philippine Airlines, who also operates five weekly flights, and Qantas, which offers four weekly flights. 

Philippine Airlines offers three classes of service including economy, premium economy, and business, while Qantas offers two classes of service. Cebu Pacific only offers a single class of service featuring unbundled fares, where travellers pay extra for everything from luggage allowance to meals. All carriers operate the route utilizing A330-300 aircraft. 

In Melbourne, Philippine Airlines is the only carrier with three weekly non-stop flights. PAL also offers three weekly flights to Darwin that continue onto Brisbane. In an ideal world, Cebu Pacific would like capacity entitlements that would enable the carrier to operate up to 14 weekly frequencies to Australia. That would represent one daily flight to Sydney and one daily flight to Melbourne. 

Cebu Pacific believes that it can sustain the increased capacity as it stimulates demand with its low fares, as witnessed when the carrier launched service between Manila and Sydney. "The growth in the Sydney market convinces us that this is a market worth investing in over time," said Kingshott. 

According to the Centre for Asia Pacific Aviation (CAPA), growth at such a fast rate usually only occurs with the entrance of a low cost carrier that drives down fares and stimulates new demand. Similar growth occurred in Australia, when other low-cost carriers such as Scoot and AirAsia X entered the market stimulating demand to destinations such as Singapore, and Kuala Lumpur. 

Cebu Pacific sees even greater potential in Melbourne where the route is currently only served by Philippine Airlines, as compared to PAL and Qantas on the Sydney route. Both cities have sizeable Filipino populations, making them an ideal fit for Cebu Pacific's expansion plans. However, CAPA warns that such plans could prove to be overambitious in the short term. 

36 comments:

  1. Cebu Pacific to Australia? No thanks. Too uncomfortable even if it is cheap.

    ReplyDelete
    Replies
    1. Yup, just like PAL. Their economy product on their A330 to OZ features the exact same sardine can low cost configuration as Cebu Pacific. Forget the food or supposedly better service. If comfort is what you're after... you won't get it on any of the Philippine carriers! How sad...

      Delete
    2. i rather choose cebu pacific because you get what you paid for. with PAL, you pay 3X as much and you only get a 50cents worth of peanut or biscuit snack, a $10 worth of meal, and a public tv for everyone. that doesn't seem to be fair getting charge at a full rate on a cheap meal and outdated technology.

      Delete
  2. Cebu Pacific Air? I prefer AirAsia X.

    ReplyDelete
  3. Im flying QANTAS to Manila via Sydney. Full service and more room!

    ReplyDelete
    Replies
    1. If you enjoy torture and discomfort on long haul flights, fly with PAL and Cebu Pacific's A330-330s and you will never fly with them again!

      Delete
    2. Correction: A330-300s

      Delete
  4. the emphasis on :

    "Cebu Pacific currently operates the Sydney route utilizing the world's most densely configured Airbus A330-300 aircraft with 436 seats."

    lol

    ReplyDelete
    Replies
    1. Sa madaling salita...the patented flying sardine can!

      Delete
  5. PAL and Cebu Pacific should stick to the standard configuration of the aircraft if they want to be competitive with the rest of the global airlines. The only reason they make profit is because they squeeze more "sardines" onto their aircraft by reconfigurating them. This is absolute torture of the worst kind!

    ReplyDelete
    Replies
    1. and unforetunately, there are also many "sardine-can-minded" people who patronize these products.

      Delete
  6. Must kuripot and nagtitipid pinoys dont really care sardines in tin can configuration of low cost carriers as long its cheap.majority pa naman sa mga pinoy ay price sensitive keber na walang frills basta cheap.this is the reason why cebu pacific is one of ASEAN profitable airlines.

    ReplyDelete
    Replies
    1. Oh really? You don't care about being packed like sardines in a tin can configuration? I bet you would complain when this pathetic of an airline launches flights to the USA.

      You pinoys need to learn how to save money and fly with a legacy carrier. Why suffer through the pain of long-haul flights on a pathetic airline like Cebu Pathetic?

      Delete
    2. Pathetic? ad hominem are we?

      Entitlements would not increase without demand.

      There is demand, so both sides have come to an agreement, whether it's budget flyers or not.

      Please, spare us the discriminatory commentary.

      Delete
  7. Ah, what a good way to start my Morning finding a new Cebu Pacific article on this site. What's this? Cebu Pathetic wants more flights to Australia on their piece of shit A330? They are even proud to have the world's most densely aircraft. What the fuck? Just as expected from a pathetic airline like Cebu Pacific.

    ReplyDelete
    Replies
    1. Good bye, fake Pinoy! You are very obviously Pinoy!

      Delete
    2. Do you even have a brain? You say that i am a "fake pinoy" then you say "You are very obviously pinoy!" make up your stupid mind.

      Delete
    3. I guess Mr. Hong Kong needs to understand a little bit of business strategies. Never did Cebu Pacific said that their seats are as comfortable as the ones you can get with Cathay Pacific. Never did Cebu Pacific advertised that they'll provide you with inflight entertaiment like the ones you can experience with Singapore Airlines. Their main business strategy is to lure passengers with cheap fares. So i think comparing a full service airline with a low cost airline is just absurd because there's no sense in doing it. Besides, they are making money, a true testament of how effective the airline is being manage... I'm not trying to pick a fight, just saying what i think you're missing when you compare 5J with other airlines...

      Delete
    4. why are Mr. HK's pointless rants allowed on this blog? Is he always drunk, belligerent or off simply off his meds? Go find another site for your garbage, what little sense you make is masked by your ignorance.

      Delete
    5. Mr.hk is a pinoy bum pretending to be business traveller in fact he can only afford to travel by non aircondition bus on the way to one of poorest province of ph. Bwahahaha!

      Delete
    6. @Anonymous May 12, 2015 at 1:09 PM
      Yeah lure passengers with cheap fares and they provide horrible flight service. Did you forget what happened last year on Christmas? As a matter of fact, i booked a second flight with this pathetic airline to fly to Davao for a Business meet up. I couldn't have my flight because Cebu Pathetic fucked up.

      @Anonymous May 12, 2015 at 4:32 PM
      Look whose talking. Listen boy. Do you know the meaning of "Freedom of Speech"? No? Go search it up.

      I will not go to another site. This site is my favorite.

      @Anonymous May 12, 2015 at 7:49 PM
      Looks like someone is talking shit about his own country by saying "poorest province of ph". Did your mother teach you some manners?

      Delete
  8. Who cares? As long as they offer the Piso fares, I will take it! Their planes are new and reliable, anyway!. I'll buy their "food for sale" in the aircraft it is cheap as well. Otherwise, I will bring my egg sandwich. Tipid.............

    ReplyDelete
  9. The more entitlements the better. I'll stick with CX or SQ, but at least there will be more nonstop seats!

    ReplyDelete
  10. Just ignore Mr Hong Kong's rants. His grammar, profanities and poorly structured comments indicate his limited intelligence and lack of understanding of the airline industry. He would do well to attend anger management classes.

    ReplyDelete
    Replies
    1. How can you ignore me when you guys love to reply to my comments? <3
      I do understand the airline industry, but explain to me why Cebu Pathetic's services are SHIT?

      Delete
  11. TAENA pala kaung mga ulol. biglaang nagiging market analyst/aircarft desing engineer/flight reviewer etc pag nakabasa ng artikulong ganito. Ang punto dito may posibilidad na naman madagdagan ng options for cheaper flights dito sa AU. Bobobo nyo dami nyo sinasabe, iingles ingle pa kaung mga ulol. kung ayaw nyo ng CEB eh di wag, lipad kau ng mas mahal. UTAK TALANGKA talaga kayong mga tipikal na pinoy.

    ReplyDelete
  12. Well said airdatanz. Mr Hong Kong is unable to grasp the fundamental differences between a legacy carrier and an LCC and all he does is bad mouth CEB because it does not suit him. He has nothing constructive to add and his ravings signify a lack of intelligence.

    ReplyDelete
  13. Mr Hong Kong you ask to explain why CEB service is s**t. Perhaps you should elucidate on exactly which parts of its service you consider as such and why. Then perhaps your questions can be answered.

    ReplyDelete
    Replies
    1. Why CEB has bad service?

      1. HKG-MNL: I took Cebu Pacific since i needed to fly to Manila for a Business meeting by the next day, however. Most of the flights on Cathay Pacific and PAL are full so i decided to fly Cebu Pathetic because they had some seats available.

      My Flight was all smooth until i asked for some beverages. These Flight attendants were being so rude to me that i have to call them 3 or more times to get me a damn drink. When they serve me a drink, the Flight attendant accidentally spilled drinks on my tuxedo. I got pissed and went to the "CR" and i can hear these Flight attendants talking shit about me.

      After my Business meeting, i canceled my return flight with Cebu Pathetic.

      2. MNL-DVO: For Christmas, i had to meet up with a Business client at Davao. Almost every LCC i tried booking with are full with the exception of Cebu Pathetic. Obviously i know this airline sucks, but i had no choice.

      Now i regret that decision. The check-in lane was so long that it took about 3 or so hours for them to announce that the flight is canceled. I was outraged about this along with the hundreds of passengers around me. They refused to give me a refund, but after battling at their office for god knows how long, i eventually got my money back.

      Jesus Christ. It boggles my mind how this Pathetic airline is in Business. Just because i am business traveler does not mean i fly Legacy carriers exclusively. I have flown with many airlines (including LCCs) and Cebu Pacific is the WORST of them all.

      Now you know why i hate this piece of shit airline?

      Delete
  14. Mr hongkong is a baklang palingkera,parlorista wishing cebu pathetic transform into pink colored FSC...bakla,bakla paano ka ginawa!

    ReplyDelete
    Replies
    1. It's you again Mr. Bakla.
      Why don't you go to ABS-CBN and audition for the bakla TV-oritentated shows? Perhaps if i see on there, i will laugh at you. If you do make it on there, make sure you say "I am the bakla Anonymous from Philippine Flight Network"

      Delete
  15. Why are you so familiar with philippine gay oriented t.v. channels?!.....mmmmmm

    ReplyDelete
    Replies
    1. Just because i am from Hong Kong doesn't mean i don't know nothing about your country? I go to Hotels, FILIPINO Restaurants, etc; and they sometimes have TV Shows from ABS-CBN.

      Judging by your comment, it seems you watch those gay orientated TV channels. Surely you and the bakla anon will have a great time watching together

      Delete
  16. Mr Hong Kong, judging by your profanities and poor grammar I doubt you have the intelligence to run your own business. You give me the impression of having a rather low I.Q

    ReplyDelete
  17. Just came across this site and I can't help but comment! Mr. Hong Kong, you are very interesting in a very weird way. (eyebrow raised and shaking head) Why would you be interested in even sparing time watching or just glancing on Filipino TV shows? Unless you understand the language it will make sense. Considering you are a business man, you shouldn't have much time trying to understand/comprehend the shows from our country. Not saying you shouldn't, but it's just so weird, a very rare case I'd say.

    And to defend Cebu Pacific, you can say everything you want to say against them, but what good does it do to you? It's just about preference. I reckon most of their flights are always full as most of the Filipinos would prefer cheap flights. Again, most! Not all. Whatever the preference is, there's nothing that we can do about it, it will just boil down to what their priority is. In fact, choosing a cheap flight is a way of saving money in contrary to what you said that Filipinos should learn how to save money. I shouldn't explain much about that, as you said, you are a Business man, and I expect you to understand that.

    But anyway, I wish you have hassle-free travels in the future whichever airlines you may come across. But if you really want to have a good experience, I suggest you take the business class or first class instead of trying to save money flying on a cheap flight! :p

    ReplyDelete
  18. 검증카 먹튀검증 안전놀이터

    ReplyDelete

Powered by Blogger.