Garuda suffers losses from domestic routes
Garuda suffers losses from domestic routes
JAKARTA (JP): For the first time, the national flag carrier Garuda Indonesia suffered losses in the first three months of this year due to low utilization of its seat capacity on the domestic routes, the airline's president says.
"There are many vacant seats in our domestic flights," Wage Mulyono told reporters after swearing in two new directors of Merpati Airlines, a subsidiary of Garuda, in a ceremony here yesterday.
Wage, who is also Merpati's chief commissioner, inaugurated yesterday Budiarto Subroto, 50, as commercial director to replace Rozali, and Mulyono, 55, as technical director to replace Rafdi Samin.
Wage said the business development in the first quarter of the year, therefore, makes Garuda not attractive to sell its shares both on the domestic and international capital markets.
Garuda thus far has been one of state companies that plan to sell shares on international capital market.
Wage refused to specify the amount of Garuda's losses in the first quarter of this year but said that the amount is not large.
Garuda currently serves 13 domestic destinations, including Jakarta, Solo (Central Java), Yogyakarta, Surabaya (East Java), Manado (North Sulawesi), Ujungpandang (South Sulawesi), Medan (North Sumatra), Denpasar (Bali), Biak and Jayapura (Irian Jaya), Banda Aceh, Balikpapan (East Kalimantan) and Batam by operating Boeing 747-200, Boeing 737-400, Airbus 300, DC-10 and MD-11 aircraft.
Vacant
Garuda's finance director Jazid Adam said that more than 800 seats were vacant in Medan-Jakarta routes every day during the first quarter.
Secretary General of the Indonesian Association of National Air Carrier (Inaca) Benny Rungkat told The Jakarta Post yesterday that serving domestic routes will be profitable only if an airline operates small-body aircraft.
"Higher frequency is more important than a large capacity for domestic services. Small aircraft, therefore, will be more suitable for domestic flights," he said, adding that ideal aircraft for domestic services include Boeing-737, DC-9, Fokker- 100, Fokker-70 and BAe 146-100.
He said that Garuda is apparently spends to much for domestic operation because it uses wide-body aircraft.
Minister of Transportation Haryanto Dhanutirto said in a hearing with Commission V of the House of Representatives earlier this year that Garuda is expected to gain a profit of Rp 264.13 billion (US$122.51 million). (icn)