October 8, 2024 | 12:00am
MANILA, Philippines — Low-cost carrier Cebu Pacific will add a niche route to its flight network with its acquisition of boutique airline AirSWIFT Transport Inc., which operates direct trips to El Nido, Palawan.
Cebu Pacific yesterday confirmed a STAR report that it has acquired AirSWIFT for P1.75 billion from Ayala Land Inc. (ALI) Capital Corp., completing yet another milestone transaction.
The airline owned by the Gokongweis will use the buyout as a door to enter El Nido, one of the most popular tourist hotbeds in Palawan, providing Cebu Pacific with a fresh route to strengthen its widest domestic network.
ALI Capital Corp. president Alfonso Javier Reyes said the company expects Cebu Pacific to find a way to cut airfares to El Nido. At present, AirSWIFT sends out Manila and Clark flights to El Nido, while Cebu Pacific reaches Palawan through Busuanga (Coron) and Puerto Princesa.
“Our investment in AirSWIFT has been a key enabler in the growth of El Nido into a world-class tourist destination. With this transaction, we are hopeful the expertise of Cebu Pacific will bring lower cost options and greater accessibility to El Nido,” Reyes said.
The sale also reduces the exposure of ALI to a volatile industry like aviation, especially at a time when the Ayala Group as a whole is divesting its non-core businesses.
For Cebu Pacific, entering El Nido through the AirSWIFT acquisition cements its reputation as the Philippine carrier with the largest domestic network.
Further, the buyout expands Cebu Pacific’s fleet by adding the five ATRs owned by AirSWIFT, increasing the number of jets it can assign to island destinations.
Cebu Pacific president and chief commercial officer Alexander Lao views the buyout as another bet placed by the airline on the economy. Recently, Cebu Pacific has taken aggressive measures to sustain its market leadership, signing a $24-billion order for 152 aircraft from Airbus.
Prior to the pandemic in 2019, AirSWIFT made P1.68 billion in revenue, showing its capability to drive profits in the right environment. As domestic travel recovered, AirSWIFT flew a record 355,458 passengers in 2023, breaking its pre-pandemic high of 321,523 in 2019.
The STAR was first to break the story about Cebu Pacific’s interest in AirSWIFT, and it was also first to report about the completion of the P1.75 billion acquisition.
To date, Cebu Pacific stands above its rivals as the largest airline by passenger volume, boasting a flight network composed of 35 domestic routes and 26 international cities.
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