An airline with a fleet of one... Why not?

An airline with a fleet of one... Why not?

JAKARTA (JP): The country's skies are becoming crowded like at
no other time in recent years. New commercial airlines are
considered a lucrative enterprise, with investors rushing in,
even if they have only one aircraft.

In Indonesia, a company may become an airline operator by
owning only one aircraft. The airline can hire pilots and flight
attendants from other airlines and obtain catering from other
companies.

Due to the prolonged economic crisis, total commercial flights
dropped to about 130 to 90 cities at the end of last year, from
201 flights connecting 115 cities in 1997. This caused mass pilot
and flight attendant layoffs.

The cabotage principle may have also encouraged Indonesian
investors to enter the commercial aviation industry. Cabotage
will likely protect them from competing with overseas airlines on
domestic routes.

Cabotage means transport in air space or between two points
within a country. In the airline industry, it is common for
overseas airlines to be barred from serving local destinations in
a foreign nation.

The General Agreement on Trade and Services (GATS), introduced
in 1995, included an annex on air transport. Air transport is
excluded from the GATS, except for aircraft repair ad
maintenance; the sale and marketing of air transport and the
operation of the computer reservation system (CRS).

For the time being, the airline industry in Indonesia is one
of the sectors saved from liberalization. For instance, United
Airlines will not be allowed to link Jakarta and Surabaya, one of
the most profitable routes.

Here is brief background information about eight new scheduled
airlines in Indonesia;

Airmark (RP): Operates two 26-seat CASA-212 aircraft for two
routes: Denpasar-Mataram and Denpasar-Sumbawa.

Airmark also plans to operate a CN235 aircraft to serve two
additional routes of Bandung-Jakarta-Tanjung Karang and Bandung-
Semarang.

Awair (QZ): Garnered unwanted publicity when it was linked to
President Abdurrahman Wahid and the major suspect in the
Buloggate scandal, Suwondo.

The airline flies from Jakarta to five domestic destinations
of Balikpapan, Denpasar, Medan, Makassar and Surabaya, and to
Singapore, by operating three Airbus A-310-300 aircraft.

Awair's president Rachmat Soebakir said it was licensed to ply
27 domestic and 28 international routes. By next year, the
company will operate additional aircraft of A-300s to expand its
services to various domestic destinations as well as to Japan,
South Korea, Australia and Europe.

Bayu Indonesia Air (BK): Previously operating as a non-regular
airline, Bayu Indonesia is owned by the former chairman of the
Indonesian National Air Carrier Association (INACA), Soelarto
Hadisoemarto. With considerable experience in the air cargo
business, Bayu now links Jakarta and Medan and Penang by
operating a Boeing B737-200 jet.

Bayu Indonesia plans to serve 20 domestic and seven
international destinations with an additional eight aircraft.

Deraya (DRY): Deyara mostly serves commuter flights in
Kalimantan and Sulawesi. The airline recently opened a thrice
daily Jakarta-Bandung service with two 30-seat Short3-30
aircraft.

Indonesian Airlines Avi Patria (IO): President Rudy
Setyopurnomo said the company was incorporated with an investment
of US$40 million.

Indonesian Airlines has won a license to serve 46 domestic
routes, said marketing manager Wuri Redjeki.

She added the initial flight, on the Jakarta-Surabaya route,
would commence in January 2001. The airline will operate two
B737-200s leased from Air France.

The airline is working with British Airways for passenger
safety management and Garuda for aircraft maintenance.

Lion Airlines (LN): Currently serves return flights of
Pekanbaru-Singapore, Jakarta-Pontianak, Jakarta-Kuala Lumpur-
Surabaya by operating four B-737-200s and Russian YAK42D
aircraft. The company allocated more than 10 percent of its total
Rp 80 billion investment for the Singapore flight.

Company president Rusdi Kirana said that his background in the
travel agency business provided him with the network to expand
his business.

Pelita Air Service (6D): The company, controlled by the state-
owned oil company Pertamina, connects Jakarta with Yogyakarta,
Makassar, Bengkulu, Pangkal Pinang, Pontianak and Kendari. There
is also a return service from Yogyakarta-Surabaya-Makassar-
Kendari.

Pelita, which has been operating for years as a chartered
carrier, operates four Fokker F-28 and one F-70 aircraft in its
regular services. (icn)