FLAG carrier Philippine Airlines (PAL) and low-cost carrier Cebu Pacific Inc. (CEB) continue to face intense competition in international routes, bracing for the race by embarking on digital transformation, enhancing their route network, and other innovation.
Still, PAL has maintained a strong market share in its international routes despite competition from both full-service legacy carriers and a growing number of low-cost carriers in the Asia Pacific region.
“Aside from point-to-point traffic, many competitor airlines also target passengers who fly between the Philippines and countries beyond airlines’ home country, via their hub airports,” PAL said in a filing to the Philippine Stock Exchange (PSE) on March 28.
Based on data from the Civil Aeronautics Boards, PAL in 2024 held a 22 percent market share of its international routes while in the domestic market, it had a 29 percent share.
PAL’s biggest competitors in the domestic market are the Cebu Pacific Group and Philippines AirAsia.
The country’s largest low-cost carrier CEB, on the other hand, has also maintained a strong market position despite competition on both its domestic and international routes.
“The level and intensity of competition varies from route to route. Principally, it competes with other airlines that service the routes it flies,” CEB said in a PSE filing on March 27.
On the domestic market, CEB is the leading airline in the country by passengers carried, with a market share of 54 percent in 2024.
CEB ranked second to PAL in the international market at 20.6 percent market share in 2024.
“However, in the fourth quarter of 2024, the Airline Group rose to also become the leading international carrier with an international market share of 22.5 percent, outpacing PAL’s market share of 22.2 percent,” CEB said.
In January and February 2025, CEB flew 4.7 million passengers, 30 percent higher year-on-year, surpassing its capacity expansion and improving its seat load factor across both domestic and international networks.
“To capitalize on this momentum, the Group will be taking initiatives in 2025 to secure its expansion plans and growth for the years ahead. The Group will continue enhancing its route network, introducing innovative services, and investing in technology to elevate the customer experience and drive sustainable growth,” CEB said.
PAL said it is embarking on a number of digital transformation projects as a key strategy to deliver personalized digital experiences across the customer journey.
PAL reported a 51 percent drop in net income to P10.2 billion in 2024 from P21 billion in 2023 due to increased operating costs and reduced revenues.
The flag carrier flew 15.6 million passengers last year and operated nearly 111,000 flights on 93 routes to 68 destinations in Asia, North America, Australia and throughout the Philippines.
Cebu Air Inc., CEB’s parent company, reported a sharp decline in net income for 2024 to P2.64 billion from P8.34 billion in 2023 due to higher operational costs.
CEB said total revenue rose 15 percent to P98.19 billion in 2024 from P85.09 billion in 2023.
It attributed the increase to higher passenger and ancillary revenues. Passenger revenues rose to P64.1 billion from P57.4 billion, while ancillary services grew to P27.5 billion in revenues from P23.7 billion.
CEB said cargo revenues stood at P5.5 billion.
