Budget carrier Cebu Pacific sent at least nine of its aircraft to a desert storage facility in Australia to reduce costs as it faces uncertainties and operates just a tenth of its normal capacity amid the pandemic.
Cebu Pacific vice president for marketing and distribution Candice Iyog said the airline should fly at least 50 percent of its aircraft to sustain operations for a longer period.
“As of July 23, we fly 23 domestic destinations and one international which is Dubai. Before the lockdown, we were flying to 37 domestic destinations. It looks like a lot but we used to fly 62 destinations in total but the big difference here is the frequencies,” Iyog said.
“We are still flying less than 10 percent of our original network and around 40 to 50 flights a day. We used to average 450 to 500 flights a day. So, it’s really a fraction of what we used to fly. Things remain uncertain up to now,” she said.
Iyog said the reduced network was due to the changing regulations of local government units, limited number of flights per province and different requirements. She said Cebu Pacific had been operating for nearly two months on agile scheduling.
She said flying to about 10 percent of Cebu Pacific’s network was not enough to sustain the business. “We need at least 50 percent to be sustainable for longer term. Ten percent is really a sample,” she said.
Iyog said Cebu Pacific sent nine aircraft for indefinite storage at the Asia Pacific Aircraft Storage in Alice Springs, Australia as part of cost mitigation measures. These include seven Airbus A321 CEOs and two A330s.
“CEB is looking to put more aircraft on indefinite storage, but this is still under study given the volatility in market demand and travel restrictions,” she said.
“We need to make sure that they are stored in a facility that will minimize damage and once the demand comes back, we can easily bring the aircraft back to the line,” she said.
Cebu Pacific reported a net loss of P1.18 billion in the January to March period, a reversal of the P3.35-billion income in the same period last year.
Revenues tumbled 24.9 percent in the first quarter to P15.91 billion from P21.77 billion a year ago as passenger revenues decreased by 27.4 percent to P11.38 billion from P15.679 billion.
The group saw a 16.5-percent drop in passenger traffic from 5.3 million to 4.4 million on fewer flights and lower seat load factor.