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Cebu Pacific Air, the Philippines’ largest discount carrier, is seeking to fly from the Philippines to Honolulu and other U.S. destinations if it can get an exemption from the U.S. Department of Transportation.
Airlines in the Philippines are currently banned from expanding into U.S. markets due to safety concerns.
The low-cost, Manila-based carrier hopes to get around that ban by leasing aircraft and crew of an unnamed U.S. carrier. The flights would be marketed as Cebu Pacific, but actually operated by another carrier.
Cebu is requesting that any exemption granted by the DOT remain in effect for at least one year. Cebu said it intends to begin scheduled service to the United States in April.
"I am confident the Department of Transportation and FAA (Federal Aviation Administration) will be able to issue the approvals Cebu Pacific will need," said Cebu Pacific’s Washington, D.C.-based attorney Charles Donley II, who filed the application. "I have obtained similar approvals in the past for other carriers based in Category 2 countries. I do not anticipate any difficulty in obtaining the same approvals for Cebu Pacific."
Category 2 is a designation given by the FAA to countries that do not meet certain safety standards.
Hawaiian Airlines and Philippine Airlines, which began flying to Hawaii before the Category 2 designation was imposed, are the only carriers currently flying nonstop between Manila and Honolulu. Cebu’s plan is to fly to Honolulu from Manila, Donley said.
On Jan. 31, 2008, the FAA downgraded the Philippines to Category 2 after finding that the Philippines’ Civil Aviation Authority was not technically equipped to supervise Philippine airline operations. FAA spokesman Ian Gregor said Wednesday he could not speculate when the country’s status would be restored to Category 1.
New York-based airline consultant Bob Mann said it is common practice for a Category 2 carrier to contract with a U.S.-based carrier.
"It is common for the FAA to approve the contracting Category 2 carrier to enter or expand in the U.S. market on that basis," Mann said. "However, the new entrant or expanding carrier requires both its own nation’s and U.S. authorities’ approval to enter or expand in the U.S. market."
In its Oct. 17 filing, Cebu said it has not had any fatal accidents or tariff violations in the past five years.
Besides flying to Honolulu, Cebu is requesting an exemption that would permit it to fly from the Philippines to San Francisco, Los Angeles, Guam, Saipan, and four additional unnamed destinations in the United States and five other countries.
"We’ve been talking to Cebu for a while now," said David Uchiyama, vice president of brand management for the Hawaii Tourism Authority. "They have expressed an interest and we have been providing them with data. (The additional service) would help (Filipino) residents. We see a lot of family travel between the Philippines and Hawaii."
Uchiyama said his understanding is that Cebu’s flight to Honolulu would include one stop.
Cebu Pacific’s entry into the Hawaii market would be its first in the state and put pressure on Hawaiian, which flies four times a week between Manila and Honolulu. Hawaiian began nonstop service to Manila in March 2008.
In October 2009, Hawaiian entered a cooperative agreement with Cebu Pacific to offer connections for Hawaiian Airlines customers between Manila and Laoag City aboard Cebu Pacific.
Philippine Airlines flies three days a week between Honolulu and Manila. Since the Category 2 designation, Philippine Airlines has been allowed to fly existing routes into the U.S. but is not allowed to add routes or change to larger airplanes.
The European Union has banned Philippine carriers from flying to Europe since April 1, 2010, over the same safety issues found by the FAA.
Cebu, which began operations in March 1996, serves 19 major international destinations from the Philippines, including Brunei, Cambodia, China, Hong Kong, Indonesia, Japan, South Korea, Macau, Malaysia, Singapore, Taiwan, Thailand and Vietnam. It serves 32 domestic points from its four hubs in Manila, Cebu, Clark and Davao and next month will begin operations at its fifth hub in Iloilo.
The airline has a fleet of 31 Airbus aircraft, including 10 A319s and 21 A320s, and eight ATR 72-500 aircraft. The airline said it has the youngest fleet in the Philippines and is one of the youngest in Asia.
Cebu Pacific is majority owned by CPAir Holdings Inc., a Filipino company owned by JG Summit Holdings Inc. JG Summit Holdings is a Filipino company largely owned and controlled by the Gokongwei family. JG Summit founder and Chairman Emeritus John Gokongwei Jr. had a net worth in 2011 of $2.4 billion, which made him the third richest person in the Philippines, according to Forbes Magazine.
As of June, his fortune had grown to $3.2 billion, Forbes said.
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