BDO-backed Cebu Pacific gets two new A320neos

MANILA, Philippines — Gokongwei-led Cebu Pacific has secured two new Airbus A320neo aircraft through a loan from BDO Unibank Inc., as the low-cost carrier continues grow its fleet to support growing demand for air travel.

In a statement on Tuesday, BDO said the deal will support Cebu Pacific’s fleet modernization and sustainability goals with more fuel efficient A320neo aircraft.

READ: Airbus wins Cebu Pacific 152-aircraft purchase order worth $24B

“We are pleased to support Cebu Pacific in this milestone investment,” said BDO executive vice president Charles Rodriguez. “As a trusted financial partner, BDO continues to provide financing solutions that help businesses scale, strengthen operations and advance their sustainability objectives.”

The airline can buy up to 50 more A320neo aircraft under its 2024 order for 152 jets, the largest aircraft order in Philippine aviation history. As of May, Cebu Pacific had taken delivery of two of the four A320neo aircraft expected this year.

Cebu Pacific received two BDO-financed jets in March and May and expects to receive the aircraft from its landmark Airbus order by 2029.

“We value BDO’s continued support as we strengthen our operations and expand our fleet,” said Cebu Pacific chief financial officer Mark Cezar. “These new aircraft will enable us to better serve our passengers while advancing our long-term growth and sustainability goals.”

Separately, Cebu Pacific tapped Germany’s Lufthansa Technik to overhaul the remaining engines on its Airbus A320ceo fleet as it phases out the legacy narrowbody aircraft.

Lufthansa to service legacy engines

Under the three-year agreement, Lufthansa Technik will service 18 CFM56-5B engines from Cebu Pacific’s A320ceo fleet at its facilities in Hamburg, Germany, and Dublin, Ireland.

Cebu Pacific said the deal marks its final CFM56-5B Maintenance, Repair and Overhaul (MRO) tender as it transitions from A320ceo aircraft to newer A320neo jets.

“At Cebu Pacific, maintaining the highest standards of airworthiness, safety and operational performance is paramount, while ensuring the efficient management of our maintenance costs,” Cebu Pacific CEO Mike Szucs said in a statement.

“As we continue to expand our fleet, we seek partners who share our commitment to excellence and embrace a culture of innovation, agility and continuous improvement,” Szucs added.

Moreover, Lufthansa Technik expects the first engine covered by the agreement to arrive at its Dublin facility by the end of July.

Dennis Kohr, Lufthansa Technik’s senior vice president for corporate sales in Asia-Pacific, said the agreement is the third engine maintenance contract between the two companies.

“Securing our third engine contract with Cebu Pacific is a milestone we are especially proud of,” Kohr said. “Writing this next chapter together with Cebu Pacific as one of our long-time partners in the Asia-Pacific region is a privilege.”

Apart from engine maintenance, Lufthansa Technik Philippines also supports Cebu Pacific with base maintenance, components, engine washes, aircraft transitions and digital maintenance systems.

This agreement comes as Cebu Pacific continues to expand its fleet to strengthen its position as the country’s largest airline. It operates the Philippines’ largest domestic network, serving 35 destinations, and flies to 26 international destinations across Asia, Australia and the Middle East.

READ: Cebu Pacific swung to net loss in Q1 on weak peso

Lastly, Cebu Pacific carried 14.5 million passengers in the first quarter, up from 13.9 million a year earlier, including 10.87 million on domestic routes. Its international network carried 3.63 million passengers. /pai INQ