Filipino low-cost carrier Cebu Pacific Air is pushing for an Open Skies agreement to be reached between the Philippines and Japan ahead of the latest round of Air Consultation Talks that are due to take place in Tokyo between September 11 and 13, 2013. In an official written submission to the Philippine Air Consultation Panel it outlined plans to aggressively expand into Japan in the future with the belief that Japan could rival South Korea in the future with regard to foreign tourist arrivals.
According to Cebu Pacific it is essential that a new air service agreement is in place to enable the country’s airlines to take advantage of any future growth as efforts continue to increase capacity at Manila’s Aquino International Airport (NAIA), the main gateway into the Philippines. The government is working on measures to boost capacity at the constrained airport by minimising general aviation traffic, but Cebu Pacific said such efforts would be wasted if Philippine carriers were not able to mount flights because of the lack of seat entitlements.
In its correspondence Cebu Pacific said seat entitlements have to be given first by countries such as Japan, so airlines like itself can increase flights to or add destinations internationally. An Open Skies agreement would speed up this process and allow Cebu Pacific and others to immediately expand its Japan operations, it said. Cebu Pacific currently operates from Manila to Osaka thrice weekly and has just a 3.1 per cent share of the total 1.48 million bi-directional O&D demand between the two countries in 2012. This market is dominated by Philippine Airlines (46.8 per cent) and Japan Airlines (16.7 per cent).
Japan, once one of the most protective aviation sectors in the world, has already signed Open Skies agreements with countries such as Thailand, Malaysia, Singapore, Hong Kong, Taiwan, South Korea, Australia, France, Sri Lanka, United Kingdom, United States, Canada and Mexico.
“Cebu Pacific plans to aggressively expand into Japan in the future. We fully support the Civil Aeronautics Board in its efforts to further boost tourism and the Philippine aviation industry. An Open Skies agreement with Japan will benefit local tourism and trade, especially since we believe Japan can rival South Korea when it comes to foreign tourist arrivals,” said Candice Iyog, vice president marketing and distribution, Cebu Pacific.
In its submission, Cebu Pacific noted that there had been a compound decrease of two per cent in the number of Japanese foreign arrivals between 2006 and 2011, and attributed it to the lack of additional seat entitlements. Meanwhile, tourist arrivals from ASEAN countries grew by double digits during the same period.
“Aside from Japan being one of the Philippines’ biggest trading partners, it is also home to 350,000 global Filipinos. Cebu Pacific’s expansion in Japan will allow us to offer our trademark lowest fares to the Philippines to boost business and leisure traffic,” Iyog added.
Since its inception in 1996, Cebu Pacific has flown over 80 million passengers. It continues to stimulate short-haul travel of passengers around Asia, with an eleven per cent rise in passenger numbers in 2012 and has ambitious plans to grow with five more Airbus A320s, 30 A321neos and 5 A330s due for delivery by 2021, updating and expanding its existing fleet of 46 aircraft – ten A319s, 27 A320s, a single A330 and eight ATR-72 500 turboprops.