Cebu Pacific will commence services to Busan with a thrice-weekly basis with A320 aircraft and the route will be inaugurated from June 15th.
Cebu will enter a route that is currently served by three carriers. SkyTeam member, Korean Air operates a four-times weekly service with B737-900 aircraft, Star Alliance member Asiana operates a daily service with a mix of A320/321 equipment and Philippine Airlines operates a four-times weekly service.
IATA BSP data shows that over 160,000 O+D passengers between Manila and Busan between October 2009 and 2010 with Asiana the market leader with a 48% share. Cebu Pacific will seek to offer lower fares and not just battle for existing capacity, but also create new traffic on a sector that has an average one way of over 350USD.
Cebu Pacific already operates three routes in South Korea. It serves Incheon from Manila and Mactan Cebu International on a daily basis, whilst it already operates to Busan with a four-times weekly service from Cebu International.
Cebu Pacific’s decision to serve Busan from Manila will be part of a strategy to gain a larger foothold of the growing South Korea to Philippines market which between October 2009 and October 2010 saw over 1.6 million O+D passengers fly the route.
The table below illustrates passenger flows between the Philippines and South Korea by carrier;
|
Carrier |
Passengers Numbers (Two-way October 2009-2010) |
Market Share |
|
Asiana |
547,690 |
33% |
|
Philippine Air |
409,772 |
25% |
|
Korean Air |
387,400 |
24% |
|
Cebu Pacific |
220,375 |
13% |
|
Zest Air |
44,118 |
3% |
|
Others |
27,619 |
2% |
|
Total |
1,636,974 |
100% |
Source IATA BSP data (October 2009 – October 2010)
There are strong ties between South Korean and The Philippines. South Korea is a major trading partner of the Philippines, whilst the Philippines is also a popular holiday resort for South Korean holiday makers.
Cebu Pacific has continued to grow its international network during this winter season increasing services from Manila to Taipei, Kuala Lumpur and Jakarta, whilst its expansion into South Korea will also continue from January 24th with a second daily service to be added from Manila to Incheon.
Cebu Pacific now operates the largest number of flights in the Philippine markets, however based on seat capacity is the second largest operator behind Philippine Airlines with a 30% share of all scheduled seats.
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