SCMAP Perspective is our fortnightly column on PortCalls, tackling the latest developments in the supply chain industry, as well as updates from within SCMAP. On this column, Henrik Batallones explores a proposal to suspend Cebu Pacific’s congressional franchise in response to reports of unsatisfactory service.
Knee-jerk reactions
Personally, I want our events to stick to our published schedules. For our recently concluded Supply Chain Immersion event, for instance, we said we expected to arrive in Manila at around seven in the evening. Frankly, though, I already knew we would not be able to deliver that, because we were flying Cebu Pacific. Their flights tend to be delayed by at least half an hour, and since we were taking a late flight out of Cebu, the chances of a delay were bigger.
What we didn’t expect, however, was to be delayed by roughly three hours. We arrived at the Mactan-Cebu International Airport at around two in the afternoon; we knew of the delay right there and then. We ended up waiting in the airport for six hours. At least the terminal – still miles away better than the Ninoy Aquino International Airport – improved even more, somehow managing to be spacier and less hurried while adding more retail stores. Also, at least we all got free Chickenjoy meals before we boarded the plane. Chalk it up to experience, and an additional lesson for our delegates in unforeseen events… although we did expect it.
Cebu Pacific’s performance has been on top of the news in recent days, as complaints about poor service and overbooked flights became the subject of a Senate hearing. One congressman even went as far as proposing that the airline, which has 57% of market share, have its congressional franchise to operate suspended.
Now, personally, I am no defender of the airline. If I have the choice, I won’t take their flights, especially international flights; I’d rather pay a little more for better flight times and slightly better leg room. But that proposal seems to be a knee-jerk reaction designed more to score political points rather than improve the overall traveling experience. There are potential job losses, not just among those directly employed by the airline, but also those who support their operations in airports across the country.
But more importantly, if the airline is prevented from operating, whether temporarily or permanently, can remaining airlines satisfy the unfulfilled demand for both passenger travel and cargo shipments? Surely not immediately, but in the medium term, can they? In the long term, can they? Would such a move lead to our air transport sector suffering massively instead of improving it?
Wouldn’t the better response be more proactive regulation? True, airlines, like other modes of mass transportation, are public services and therefore should be able to satisfactorily deliver to its customers. To effectively measure this, targets need to be set and strictly adhered upon. How often do flights arrive on time? How long are they delayed? Are customers satisfied with processing ticket purchases, rebookings, or refunds?
Think of it as a service level agreement between government and industry. If agreed-upon performance metrics are met, then maybe we can justify paying more. If they aren’t, then we have a better place to start discussing the reasons. Is it purely the airline’s fault? Could it be, say, limited capacity in our airports? (Remember the frequent “delay of turnaround aircraft” reasoning we heard before the pandemic?) Is it, as Cebu Pacific argued during the recent Senate hearing, because of global delays in the acquisition and maintenance of aircraft and aircraft parts? A better understanding of what makes “good service” leads to better decision-making.
And this doesn’t just apply to airlines. Frankly, we should do this for all modes of transportation, whether they move passengers or cargo – for as long as they are serving the public, rather than be commissioned privately, like chartered flights. Airlines, shipping lines, airport and seaport operators, maybe even bus and jeepney operators… you get the idea.
Of course, it’s not a perfect solution. We can have long discussions over what constitutes “satisfactory service”, for instance. There’s always the perennial problem of regulatory capture and how the watchdogs can end up serving the franchises rather than the public. And sooner rather than later the conversation will move towards whether our infrastructure is sufficient to support growing demand. But surely knee-jerk responses that can do more harm than good is not the way? That will not inspire confidence among businesses and investors – and considering the amended Public Service Act now allows foreign entities to own 100% of our airlines, well, who will buy if they can’t operate without the threat of some politician always holding an axe?