Garuda to suffer huge net loss of Rp400b this year<\/p>\n
JAKARTA (JP): President of PT Garuda Indonesia Robby Djohan
\nsaid on Tuesday that he expected the national flagship carrier to
\nincur a net loss of roughly Rp 400 billion (about US$38 million)
\nthis year due to the economic crisis.<\/p>\n
He explained that the crisis, in which the rupiah has lost
\nabout 75 percent of its value against the U.S. dollar since July
\nlast year, had slashed passenger load factor to between 40
\npercent and 50 percent, and boosted operating costs which were
\nabout 80 percent in the dollar.<\/p>\n
\"But we will try to minimize the loss through efficiency
\nprograms,\" he told reporters on the sidelines of a hearing with
\nHouse of Representatives' Commission IV for transportation and
\ncommunications.<\/p>\n
He said the airline enjoyed a net profit of Rp 200 billion in
\nAugust, attributing it to the peak tourist season which raised
\nthe load factor to about 85 percent.<\/p>\n
\"We expect net profit to remain high in September because of
\nthe strong load factor,\" he said, adding that the airline was
\nexpected to fall into the red during the remaining months of the
\nyear as load factor would drop below 50 percent.<\/p>\n
He added that part of Garuda's efficiency efforts was a staff
\nrationalization program, in which around half of its 12,000
\nemployees would be encouraged to join the voluntary program with
\nretrenchment compensation.<\/p>\n
About 3,000 employees are expected to join the program next
\nmonth.<\/p>\n
Robby also said that Garuda had cancelled a leasing contract
\nfor six MD-11 aircrafts and three Airbus A-300 because it was
\ndeemed too expensive.<\/p>\n
Under the initial contract signed with Garuda's leasing
\nbroker, a MD-11 aircraft cost $1.1 million per month.<\/p>\n
Robby said he demanded $500,000 per aircraft, but the
\nbrokerage firm offered $750,000 per unit.<\/p>\n
The airline has also cut down unprofitable international
\nroutes to save costs, or entered into joint operation agreements
\nwith leading overseas airlines including KLM, Northwest and Swiss
\nAir.<\/p>\n
Director General of Air Communication Soenaryo Y. admitted on
\nTuesday that despite the 232 percent increase in airfares between
\nOctober and September, the country's five scheduled airlines were
\nstill unable to cover operating costs.<\/p>\n
\"The airlines are still in difficulties in securing enough
\ncash to cover costs,\" he told the commission.<\/p>\n
\"Improving efficiency and productivity are the efforts taken
\nby the airlines.\"<\/p>\n
He said the airlines had slashed the number of their operating
\nfleet to 90 aircraft as of September, and restructured 52
\nunprofitable domestic routes and 17 international ones.<\/p>\n
He added that the industry would also seek tax consideration
\nto compensate for the declining market share due to direct
\nflights into the country by about 37 overseas scheduled
\nairlines. (rei)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/garuda-to-suffer-huge-net-loss-of-rp400b-this-year-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}