Philippine Aviation defies recession, grows 9.6% in 2008

Philippine Aviation market performs better than expected

March 14, 2009

Manila - THE Philippine aviation market defies World recession in 2008 as it continue to register positive growth amidst volatility in the airline business.

Despite growing decline in aviation passenger traffic worldwide, more particularly the Asia Pacific region, hardly hit by dwindling traffic, Philippine carriers continued to defy the trend as it managed to sustain traffic movements and registers extraordinary growth in the most unusual time.

Recent Civil Aeronautics Board (CAB) data disclosed that domestic and international air travel passengers in the country managed to grow last year at a staggering 9.6%, although at a rate slower than that of 2007 which was 22%.

Domestic airlines carried a total of 11.765 million.
International carriers carried a total of 12 million.
Total registered traffic for the Philippines is recorded at 23.765 million passengers.

Domestic air passengers grew by 13.2% to 11.765 million last year from 10.389 million in 2007. The CAB had projected that domestic air travel would grow 15 percent in 2008 from 22.7 percent in 2007 because of high oil prices and inflation.

International air passengers grew by 6% to 12 million in 2008 from 11.33 million the previous year, which is considered modest considering that other countries in the region suffered massive decline in foreign traffic. Growth in 2007 was 10.85%. Of the total foreign visitors, incoming passengers were up by 6.9 percent to 5.8 million while outgoing passengers inched up 5.2 percent to 6.18 million.

PAL registered the highest number of international passenger flown with 3.6 million, a 0.17-percent increase from 3.4 million in 2007. Its incoming passenger traffic stood at 1.77 million, while outgoing traffic reached 1.84 million.

Cebu Pacific carried 1.32 million international passengers last year from 1.03 million in 2007. Incoming passengers stood at 1.77 million while the number of outgoing stood at 1.84 million.

CAB Executive Director Porvenir P. Porciuncula said that the agency expects a 10% rise in domestic air passengers this year but 0% growth for international passengers. It is however better than the IATA predictions of other countries in Asia Pacific.

The industry’s total load factor, that is the number of seats occupied during a flight, fell to 75 percent last year, from 78 percent in 2007. It was however attributed to the increase number of seats offered by Philippine Airlines and Cebu Pacific. The total number of seats in 2008 reached 15.3 million from 13.34 million in the previous year.

Cebu Pacific again dislodged Philippine Airlines (PAL) as the leading domestic carrier, having flown 5.35 million from 4.46 million in 2007. Despite its leadership, Cebu Pacific’s load factor fell to 79 percent from 83 percent in 2007.

PAL carried 4.91 million passengers last year from 4.03 million in the previous year, but its load factor slipped to 78 percent from 79 percent in 2007.

Zest Air, formerly Asian Spirit, was most affected by rising fuel costs as its passenger count dropped to 374,145 from 484,482 in 2007.

Air Philippines and Southeast Asian Airlines (Seair) posted drops in passenger count to 913,570 and 217,879 from 1.17 million and 245,020, respectively.

Domestic air cargo also fell 3.6% to 137.521 million kilograms from 142.695 million kg for the same comparative periods.

Of the 43 international carriers with authority to operate in the country, only 33 operated during the period. The CAB said Air Nauru, Vietnam Airlines and British Airways ceased flying to the Philippines in 2001 followed by Swissair, EgyptAir, Air France and P.T. Bouraq in 2004. Lufthansa suspended operation in 2007.