Cebu Pacific, the Philippine budget airline, is currently in negotiations with Airbus and Boeing (NYSE:BA) for a potential order of 100-150 narrowbody jets, valued at over $12 billion based on manufacturer catalog prices. This potential order, announced in an October 17 statement, could be the largest in the nation's aviation history with proposals due by the end of the year.
The airline's CEO, Michael Szucs, emphasized the need for local carriers to quadruple their size to cater to the expanding Filipino market. This comes in light of Southeast Asia's forecast as the fastest-growing region for the next 20-30 years and the Philippines' central role within it.
Representatives from Airbus and Boeing have already visited Cebu Pacific for early-stage proposal discussions. If successful, this proposed order could more than double their fleet by 2035. The airline currently operates a fleet of 73 aircraft, primarily from Airbus, including models such as Airbus 330, Airbus 320, Airbus 321, and ATR turboprop aircraft.
In a stock exchange filing on Friday, Cebu Pacific confirmed that a firm purchase commitment will be made following successful negotiations. The airline issued an RFP to Airbus and Boeing for the new aircraft as part of a meticulously planned process involving both technical and economic evaluations.
This potential deal comes as Cebu Pacific plans to exploit strong post-pandemic travel demand and regional growth opportunities. The airline reported a Q2 operating profit of Ps2.5 billion, marking its second consecutive profitable quarter.
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