Cebu Air losses continue to mount as it awaits surcharge petition

MANILA, Philippines — Losses continue to mount for Cebu Air Inc. as it waits for regulatory approval for its proposed fuel surcharge aimed at recovering higher expenses due to rising fuel costs and the weakening of the peso against the dollar.

“The increase in fuel price has been rather significant so I think Philippine Airlines, Cebu Pacific, and other airlines have all applied for fuel surcharges. They (losses) are mounting, but we’re long term partners of the national government,” Cebu Pacific president and CEO Lance Gokongwei said.

Gokongwei said the extra cost of fuel is costing the company about P500 million a month.

The official, however, declined to provide the amount of accumulated losses the company has incurred so far, opting to be more understanding of the government’s situation. 

“Naturally, because they are concerned about long terms inflationary effects, they also have to study this petitions very carefully. We’re in regular dialogue with them and we do know that they are taking our petitions very seriously. But I guess they cannot just look at from an immediate cause and effect. They have to see the national repercussions of this,” Gokongwei said.

“If the government approves it, they also have to justify it to the people so they cannot just approve this without studying it carefully,” he said.

Gokongwei last May said Cebu Air has applied for fuel surcharges with the Civil Aeronautics Board amounting to P70 to P250 for domestic flights.