Cebu Pacific to buy up to 152 Airbus planes worth P1.4 trillion
Cebu Pacific said Tuesday it will buy up to 152 Airbus planes worth $24 billion (P1.4 trillion) in a deal it described as the "largest aircraft order" in the country's aviation history.
"The order is designed to provide Cebu Pacific with maximum flexibility to adapt fleet growth to market conditions, with the ability to switch between the A321neo and A320neo," Cebu Pacific chief executive Michael Szucs said in a statement.
The company said it had signed a binding memorandum of understanding with Airbus that covered "firm orders" for up to 102 A321neo aircraft and purchase rights for 50 A320neo.
The order was worth $24 billion based on list prices, it added.
Cebu Pacific said it would use Pratt & Whitney engines for the planes despite previously reporting problems with the firm's engines that had forced the airline to ground at least 10 planes.
"When finalized, the deal will be a significant milestone for the local airline industry," Szucs said.
The transaction would be finalized in the third quarter of the year, according to the statement.
Airlines have roared back after the Covid-19 pandemic, with passenger numbers and revenues expected to hit record highs this year, trade body IATA said in June.
The International Air Transport Association said nearly five billion passengers were expected to fly in 2024 and revenues would near $1 trillion.
But airlines are also facing a sharp rise in costs caused by shortages of parts and labour, and challenges related to climate change.
Their total expenses are also expected to hit a record high this year, climbing 9.4 percent to $936 billion, IATA said.
At a Singapore airshow in February, Szucs told AFP that Cebu Pacific had a "shortfall in capacity" owing to aircraft grounded or delays in deliveries.
"It's just never been more difficult to keep the fleet flying," he said. (AFP)
