AirAsia Philippines is optimistic about its 2025 growth prospects as the country is poised to achieve upper-middle-income (UMIC) status.
“Transitioning to upper-middle income next year would be a positive development not only for the Philippines, but also for foreign investors who are closely monitoring the country, as this will break our 37-year status as a lower-middle-income nation,” AirAsia Philippines head of communications and public affairs Steve Dailisan said.
“While we see challenges such as the fluctuating peso-dollar rate, unstable fuel costs and the current situations in other countries affect our GNI [gross national income, we are positive that we will transition a notch higher from our current status,” he said.
The National Economic and Development Authority earlier said the Philippines is likely to achieve the UMIC status by next year after its gross national income (GNI) per capita exceeded the 2023 target under the Philippine Development Plan (PDP) 2023-2028.
First Officer Steve Dailisan
The World Bank earlier reported that the country’s GNI per capita reached a historical high of $4,230 in 2023, marking a 7.1-percent increase from the preceding year.
This surpassed the 2023 target range of $4,130 to $4,203 GNI per capita set in the PDP 2023-2028, according to NEDA.
The World Bank defines UMIC economies as those with GNI per capita ranging between $4,516 and $14,005 for the fiscal year 2025.
Dailisan said the country’s transition to UMIC would mean growth for AirAsia Philippines as this would increase travel demands as influenced by the public’s strong purchasing power.
“Having enough purchasing power gives AirAsia guests the liberty to choose destinations and schedules outside of the usual low-fare offerings (PISO Sale, Double Digit Sale, Seasonal Sale),” he said.
“This will also translate to more purchases for our ancillary products such as choice seats, additional baggage allowance, travel insurance, food and beverages, and other inflight items,” Dailisan said.
Eventually, Dailisan said an increase in demand would also call for additional flight frequency, aircraft allocation, revival of Cebu and Clark hubs and the mounting of new routes, all which has been in the AirAsia Philippines pipeline since exiting the pandemic.
The budget airline expects its passenger traffic to grow more than 30 percent this year as it strengthens its domestic and international operations.
The budget carrier said it is looking to close 2024 with more than 8 million passengers, up 34.2 percent from 5.96 million domestic and international passengers last year.
From January to August 2024, AirAsia Philippines flew over 5 million guests, 85 percent of which were booked via double-digit, PISO sale and other low fare promos.
AirAsia Philippines flies to 12 domestic destinations and 13 international destinations as of April 2024.
