Philippine low-cost carrier Cebu Pacific is leasing one of its Airbus A320neo aircraft to Vietnam's flag carrier, Vietnam Airlines, as it looks to generate additional revenue during the region's traditionally slower third-quarter travel season.

In a statement, Cebu Pacific said it had signed a wet lease agreement with Vietnam Airlines to deploy the Pratt & Whitney-powered A320neo for operations running from July 15 to September 7.

Under a wet lease arrangement, the aircraft owner supplies the plane along with its own pilots and cabin crew, as opposed to a "dry lease," where only the aircraft is provided.

The aircraft will be based in Ho Chi Minh City, Vietnam's main commercial and financial hub, and will operate domestic routes to Cam Ranh, Phu Quoc, Vinh, and Da Nang.

Cebu Pacific Chief Financial Officer Mark Cezar said the deal allows the airline to make better use of its fleet during Southeast Asia's rainy season, when domestic travel demand typically softens and aircraft utilisation drops.

"This collaboration with Vietnam Airlines enables Cebu Pacific to broaden its role beyond passenger operations by providing operational support to airlines across the region," Cezar said, adding that the arrangement also helps diversify revenue streams while expanding the carrier's presence in one of the world's fastest-growing aviation markets.

Cebu Pacific, controlled by the Gokongwei business group, has previously entered into similar arrangements. During its peak summer season last year, Saudi Arabian budget carrier flyadeal wet-leased two A320 aircraft from Cebu Pacific to supplement its own fleet.

The Philippine carrier currently operates a fleet of 101 aircraft, including A320, A321, A330, and ATR models.

Cezar said that as Cebu Pacific's fleet continues to grow, the airline is well positioned to deploy spare capacity where it is most needed, including through strategic wet lease deals during periods of lower demand at home.

Maximising fleet efficiency is expected to help the airline offset ongoing headwinds facing the aviation sector, particularly amid geopolitical tensions in the Middle East that have weighed on regional carriers' costs and operations.

Cebu Pacific reported a net loss of 399.81 million pesos (about $7 million) for the first quarter of the year, reversing a net income of 465.90 million pesos recorded in the same period last year.

Source: Manila Bulletin