Cargo and LCCs: Cebu Pacific case study shows cargo can pay
Air cargo is often an afterthought for low cost airlines. While cargo is important for most full service network airlines it has typically not been viewed as a core component of the LCC model.
Some LCCs refuse to carry cargo entirely, worried it would increase turnaround times and costs, outweighing any revenue gains. Several LCCs outsource their cargo capacity to third party specialists, generating revenues that typically account for less than 3% of total revenues.
However, cargo can be a much bigger revenue contributor for LCCs with little cost or risk if managed appropriately. The Philippine LCC group Cebu Pacific provides one of the best examples of an LCC cargo strategy that fully leverages the potential benefits. Cargo has consistently accounted for 6% to 7% of total revenues at Cebu Pacific – even before the airline group began operating widebody aircraft.
To access CAPA Premium Analysis you need a CAPA Membership
Your window into the latest insights
CAPA employs an industry-leading Analyst team based in Europe, North America, Asia and Australia who offer unique perspectives and independent and accurate commentary of critical industry developments globally. CAPA Members rely on our Analysis to unlock valuable insights and actionable intelligence to keep ahead of the game.
Big picture strategic view
Our Analysts don’t just report the news - they take a big picture strategic view of aviation dynamics, issues and trends and analyse the implications of these developments for you.
The CAPA Analyst team is based globally to ensure our CAPA Members have access to independent, unique perspectives covering an entire spectrum of daily, worldwide commercial aviation developments.
Customise your Alerts
CAPA Members can use CAPA Alerts to receive daily, weekly or monthly and customised updates on our Analysis.
I'm very impressed by the factual and detailed analysis CAPA is always doing.- CEO, Airline Member
Phone: +61 2 9241 3200 | Email: email@example.com