AIRSWIFT Airlines Philippines, the commercial carrier of the Ayala Group, is looking forward to increasing its seat capacity this year as it connects more leisure destinations in the country.
In an email interview with the BusinessMirror, AirSWIFT President and CEO Alfonso Reyes said, “We are seeing significant leisure travel demand in 2023 and are very bullish on being able to finally put the difficult years of the pandemic behind us.”
He added, “We will be increasing seat capacity by 30 percent by the end of the year to meet this strong demand, as El Nido continues to develop as one of the country’s top tourism destinations.”
The additional seat capacity will be provided by the acquisition of a brand-new turboprop ATR 72-600 through a lease contract, which will beef up the boutique airline’s existing fleet of two 48-seater ATR 42-600s and two 70-seater ATR 72-600s. The new plane is expected to be delivered by December. In Manila, the airline operates out of Ninoy Aquino International Airport (NAIA) terminal 4.
Leisure travel demand
The “work-from-anywhere” mode has helped lift leisure travel demand among Filipinos and foreign tourists alike, noted Reyes, such that he forecasts AirSWIFT’s average passenger load factor to rise to 82 percent this year, even higher than the 73 percent average in pre-pandemic 2019.
“Leisure travel demand seems to be much stronger now compared with 2019. We do not think this is necessarily just revenge travel but possibly shifting travel patterns, as the continuation of hybrid ‘work-from-anywhere’ models allow for more long weekends and more travelers being able to mix work with leisure travel. So far we are seeing this trend both with local and foreign travelers,” he said.
The airline plans to expand its routes this year connecting El Nido in Palawan and Siargao, Surigao del Norte. “The strategy has always been to connect AHRC (AyalaLand Hotels and Resorts Corp.) destinations such as El Nido and Sicogon, to not only Manila, but as many other major gateways or tourism destinations in the country as possible,” added Reyes. Last year, the carrier relaunched all flights that were halted by the pandemic: Manila-Coron and Manila-Sicogon; El Nido to Boracay, Cebu, Coron; and a Tagbilaran- and Clark-El Nido. A new route was also introduced last year between Manila and Tablas (Romblon).
Fuel, parts challenges
The carrier has its roots in Island Transvoyager Inc., a chartered carrier which flew daily flights from El Nido. It became a commercial airline in 2015 when it rebranded as AirSWIFT, three years after acquisition by the Ayala Group. The carrier is now operated by Ayala Land Inc., whose hospitality unit has also benefited from the surge leisure travel. (See, “ALI hotel unit to add more rooms this year,” in the BusinessMirror, May 8, 2023.)
The business is not without its disadvantages, however, especially with the lack of heft afforded by legacy airlines and more established low-cost carriers. “The main disadvantages [of operating as a commercial carrier now] are the difficulty of adding flights from Manila given the existing runway congestion at Naia, and being able to keep ticket prices more affordable given the very high inflation and cost of fuel,” said Reyes.
“There is also the challenge of being able to resolve maintenance issues as quickly as possible so as not to significantly disrupt flight schedules, as the availability of spare parts globally is much tighter than before, as aircraft parts manufacturers continue to have supply chain issues,” he noted.
According to its parent unit’s 2022 annual report, the lifting of travel restrictions and rebound in leisure travel improved the carrier’s revenues to P1.2 billion in 2022, just 29 percent less than its revenues in pre-pandemic 2019. Flights more than doubled to 5,330 versus 2,573 in 2021.