Fri, 22 Dec 2000

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)