Cebu Pacific bets on expansion in new NAIA

MANILA, Philippines — Low-cost carrier Cebu Pacific has started relaying to San Miguel Corp. (SMC) possible reforms that can be applied to the Ninoy Aquino International Airport (NAIA) to improve accessibility.

Primarily, Cebu Pacific hopes SMC can fulfill its promise to the Department of Transportation (DOTr) of increasing aircraft movement in NAIA to 48 per hour from 40 at present.

Cebu Pacific president and chief commercial officer Alexander Lao said reaching as many as 48 aircraft movements per hour would mean that the airline can expand operations in Manila.

In the process, Cebu Pacific can introduce new routes and raise flight volumes from NAIA. Lao said the more aircraft the airline can bring in, the better the efficiency, paving the way for a reduction in airfares.

“Both SMC and DOTr said they intend to bring up movements here in Manila airport from 40 an hour to 48 an hour, and that is massive for us airlines. Per incremental movement per hour, that means we can base one or two more aircraft in Manila, basically adding lines of flying,” Lao told The STAR.

“Clearly, the more infrastructure that comes in, the more aircraft we will bring in. The more aircraft that we bring in, the cheaper the airfares can go,” he added.

In informal talks with SMC, Cebu Pacific also relayed its intent to maintain its position as the biggest operator in NAIA for passenger volume and fleet count.

Right now, the airline flies to 29 domestic destinations and 23 international cities from its Manila hub, underscoring the importance of NAIA to Cebu Pacific.

SMC leads the New NAIA Infrastructure Corp. (NNIC) that won the bidding for the P170.6 billion concession to operate and maintain the gateway. Based on the schedule of the DOTr, the airport will be transferred to NNIC by September.

NNIC will run the airport for a minimum of 15 years, and may get a 10-year extension based on its performance. At the outset, NNIC plans to build a new passenger terminal in NAIA to expand its capacity in facilitating air travel.

Apart from this, NNIC intends to develop an access road from NAIA Expressway to Terminal 3 to improve traffic flow around the airport.

The government expects to gain as much as P900 billion from the turnover of NAIA operations to the private sector, made up of P30 billion in upfront fee, P2 billion in annuity payment and 82 percent share in revenue.