Garuda may add aircraft to meet passenger increase

DENPASAR, Bali (JP): The national flagship carrier Garuda Indonesia is considering adding more aircraft to its fleet to meet the surge in the demand.

Garuda president Abdulgani said here on Saturday that the increase of passengers using the airline's services over the last two years had been very encouraging.

"The demand trend continues to increase and we hope Garuda's load factor will further grow to 75 percent this year," he told reporters after the presentation of tokens of appreciation to 35 foreign travel and cargo agents.

Abdulgani said that the company's load factor, which was only averaging 58 percent in 1999, had grown significantly to a current rate of 73 percent, following the airline's massive consolidation measures both financially and operationally.

The ideal load factor for Garuda, which operates 47 jets of various type and size, is between 65 percent and 70 percent, Abdulgani said.

If the load factor exceeds that range the airline should add more aircraft to ensure customer convenience, he said, adding that in the short term, the procurement of new aircraft would be focused on supporting domestic services.

For international services, Abdulgani said the airline is waiting for development of its newly opened services, such as Seoul, before making any commercial decisions.

Since resumption of the service in October last year, flights from Seoul to Jakarta, and vice versa, have exhibited a steep growth in demand. The number of flights on the route has been increased from two to four per week.

Abdulgani also noted that Garuda increased the frequency of its Jakarta-Singapore service from four to seven flights a week last year.

Garuda commercial director Bachrul Hakim said in January that the company was also studying the possibility of resuming its international flights to Fukuoka in Japan and several destinations in China.

Garuda suspended services to 17 international destinations, including Seoul, Taipei, Honolulu, Los Angeles, Paris, Rome, Zurich and Saigon, late in 1997 due to the impact of the economic crisis in Indonesia.

Bachrul said Garuda was sticking to its policy that it would not operate at a loss.

"We will open new routes only when there's an opportunity to open routes that have sufficient market demand and will add to Garuda's profit," he said.

Garuda currently has a fleet of 47 aircraft, consisting of 24 Boeing 737s, seven Boeing 747s, six A-330s, five DC-10s and five F-28s.

Since November last year, Garuda has added six more Boeing aircraft to its fleet to meet the rising demand for its domestic flights.

Those six aircraft are among seven Boeing 737s it has leased from American financing companies GE Capital Aviation Services (GECAS) and the International Leasing Finance Company (ILFC) for a three-year period.

"Next month, the remaining Boeing 737 will be delivered," Gani said, adding that the plane would be deployed to meet domestic needs.

Although Garuda has made significant progress, the airline, like other flight operators, should not be complacent, said an executive at Kuala Lumpur's Sime Darby Travel Sdn Bhd travel agency.

The agency's manager, Phillip James Martin, said that, compared to other operators, like Malaysian Airlines (MAS) and Singapore Airlines, Garuda was still too expensive.

"Compared to MAS's (Kuala Lumpur-Jakarta) ticket price for instance, Garuda offers more than a 100 ringgit difference (above the MAS fare)," Martin said, adding that the difference wouldn't matter if it was below 100 ringgit.

According to Martin, with its much improved services and punctual departures, Garuda will be more competitive if it also lowers its fares.(03)