Cebu Pacific aims to significantly enhance its position in the air cargo industry as it formally launched its first dedicated cargo aircraft—an ATR 72-500—which will start operations on September 4.
The airline is the first in the Philippines to have a dedicated cargo aircraft. For its initial operations, the freighter will fly daily out of Ninoy Aquino International Airport (NAIA) to Cagayan de Oro, and vice versa. Routes to and from other Mindanao airports are eyed, too.
Operations will move to Sangley Airport in Cavite later this year when the airport opens for business. This move will give the airline more operational flexibility as Sangley has no restrictions on slot use, which NAIA has.
Cebgo, a subsidiary of Cebu Pacific, will operate the freighters.
“Our ATR freighter will significantly improve our position in the domestic cargo market, addressing the gap between quantity of goods to be shipped, urgency and infrastructure limitations,” Cebu Pacific vice president for cargo division Alex Reyes said in a speech during the August 14 launch.
The initial focus is on the domestic market where “demand is very strong” although there are plans to operate in the Asia-Pacific region as well.
The freighter is the first of two ATR planes that Cebu Pacific commissioned Sabena Technics, a French-based aircraft maintenance and modification service provider, to convert into all-cargo planes. Conversion of the second aircraft is expected to be completed later this year.
Growing demand for perishables
Reyes said the growing demand to transport perishable goods quickly, the increasing need for just-in-time production of goods, and the rise of e-commerce have created a massive demand for air freight services.
Such demand, he explained, has fueled growth of Cebu Pacific’s cargo business over the past years. In the first half of 2019, revenues from cargo operations reached P2.8 billion, a 7% year-on-year hike as the carrier flew more than 101 million kilograms of goods. The growth is in contrast to the first-half downturn in air freight volumes seen in the Asia-Pacific region.
Reyes hopes the cargo business’ contribution to group revenue will reach double digits from the current 8%.
Space in passenger aircraft bellies is no longer enough to meet rising demand, he said. “Businesses want more options with regard to the manner and method of moving their goods; consumers, in the meantime, want their purchases delivered the next day. These scenarios give rise to the need for bespoke cargo service—one where shippers are able to speedily deliver their goods to buyers.”
Unlike jets, the ATR freighter can land on short runways and can therefore reach smaller airports that cater to areas with strong demand for perishable cargoes such as Busuanga, Marinduque, and Baguio, he explained.
Of the 90 airports in the Philippines, he noted only about a third can land jets; the rest have runways less than 1.2 kilometers long, a length “perfect for the ATR.”
The freighter can carry up to 8 tons of goods, and is configured with a large cargo door to make it easy to load up to seven AKE air cargo containers, or five PBJ pallets.
The freighter is available for charters; the company has already received booking inquiries under that arrangement.
In his welcome remarks at the launch, Cebgo president Alexander Lao said the freighter complements the group’s fleet of Airbus jets which, by 2024, will have the ability to carry palletized cargo.
“Movement then of goods from small Philippine islands to big international consolidator ports and hubs in the region will be easier and more efficient,” Lao said. – Roumina Pablo
