Ansett, developing new market niches

Ansett, developing new market niches

The airline industry usually represents an early barometer of
the economic health of a nation, or the relationship between two
nations.

It is clear the economic health of the relationship between
Indonesia and Australia is very strong indeed, if the recent
growth of the airline industry is used as the measure.

Airline passengers continue to grow in record numbers, while
airfreight has demonstrated substantial growth, albeit on a lower
base. Passenger growth has averaged some 17 percent per year for
each of the past four years, while the recent bilateral
discussions between Indonesia and Australia resulted in a further
capacity increase of some 38 percent over the coming 18 months.

The effect of this rapid increase in capacity growth and
passenger numbers has been the introduction of new airlines to
the market, the development of new city pairs between Indonesia
and Australian cities and more innovative airfares and package
holidays.

While Garuda Indonesia pioneered many of the new city pairs
and played a major role responsible in the development of inbound
tourism to Indonesia, particularly Bali, it was the Australian
government's initiative in introducing multiple airline
designation in February 1992 that played a major role in
expanding opportunities.

The change of government policy enabled new airlines, such as
Sempati Air and Ansett Australia, to enter the international
airline market, although both had been operating for some time as
domestic airlines.

Sempati Air commenced flights between Denpasar and Perth and
later, Jakarta and Perth, while in September 1993, Ansett
Australia commenced its first international flights between
Denpasar and the four Australian gateway cities of Sydney,
Melbourne, Perth and Darwin. QANTAS, at the same time, showed
renewed interest in flying to Denpasar, matching the Ansett
Australia services.

Ansett Australia, although new to international operations as
a scheduled airline, was not inexperienced as such. It had
submitted its first application to fly internationally as far
back as 1945 and, in a series of initiatives, had assisted in the
establishment and development of a number of new airlines in the
South Pacific region during the 1980s. It had also operated a
series of charter flights between regional Australian
destinations and Denpasar during the 1980s and the early 1990s.

As a private enterprise airline, Ansett Australia had long
demonstrated a willingness to be an innovative airline with a
strong customer focus. And the airline's subsequent expansion of
services to Jakarta in February 1996 represented a further
commitment to Indonesia and the expansion of opportunities
between the two countries.

The arrival of Ansett Australia to the Jakarta market has
stimulated both the passenger and cargo markets. The airline's
enthusiastic approach to developing new market niches, both
inbound and outbound, has surprised many industry observers, with
the airline clearly working to build long-term relationships in a
number of areas.

That approach, combined with the airline's award winning
in-flight service, has encourage other airlines to competitively
respond with improved services. Direct flights from Jakarta to
more destinations in Australia and new and larger aircraft types,
have ensured business and leisure travelers can now confidently
plan their travel needs between Indonesia and Australia.

The economic health of the relationship between Indonesia and
Australia is certainly robust, with an outlook of continuing
growth. The airline industry is playing its role with energy and
enthusiasm and, no doubt, with a small amount of encouragement
from the presence of Ansett Australia.