Lufthansa expects Indonesia to take off

Lufthansa expects Indonesia to take off

JAKARTA (JP): Lufthansa German Airlines' vice president for
Asia and the Pacific Manfred Reimer said here on Thursday that
business prospects in Indonesia remained promising despite the
current economic crisis.

Reimer said that last year's revenue from the airline's
Indonesian operation exceeded expectations and the trend was
expected to continue this year.

"We have absolute confidence in Indonesia. We have started
this year with revenue 10 percent over our expectations for this
country and we will continue to take our opportunities," he said
at TECHNOGERMA Jakarta, the German technology fair.

"We will not do stupid things like expand our capacity if we
don't think we will make money from it," he added.

Lufthansa's country manager in Indonesia, Carlos Heinemann,
said that the airline's load factor in Indonesia was still good
despite the crisis.

Heinemann said that the airline's average load factor last
year reached over 80 percent and the airline had no plans to cut
its flights to Indonesia.

Lufthansa flies from Frankfurt direct to Jakarta four times a
week using Boeing 747-400 aircraft. It also has a code-sharing
deal with Singapore Airlines to carry Lufthansa passengers from
Singapore to Indonesia.

"Our code-sharing agreement with Singapore Air has enabled us
to maintain our load factor above 80 percent despite the current
economic crisis. This year we expect a 100 percent load factor,"
he said.

The airline reduced its direct flights to Jakarta from seven
flights a week to four and added three code-share flights with
Singapore Airlines last year due to the slumping load factor.

"But we will go back to seven flights again as soon as
business returns to normal," Reimer said.

Heinemann said Lufthansa suffered a slump in Indonesia in the
first semester of last year. The airline's revenue from its
Indonesian services was 50 percent lower than in 1997 during the
same period because the airline had to lower its fares by 50
percent.

"The business is actually just picking up again but it's not
yet back to normal," he said.

The number of German visitors to Bali has risen as more
Lufthansa passengers are avoiding Jakarta by flying direct to
Bali from Singapore, he said.

He said, however, that a few isolated cases of violence and
unrest had misled international travelers into thinking that such
occurrences were common throughout the capital.

"Misleading reports have discouraged people from flying to
Jakarta. So we are helping to promote Indonesia in Germany
because we have a lot of interest here."

Heinemann said that many Indonesians had shifted from first
class to economy class and business class because of their lower
purchasing power.

"Demand for first class has dropped by about 30 percent while
demand for business and economy class has increased
significantly," he said.

Reimer said that 1998 was a record year for Lufthansa despite
the Asian economic crisis. He said the airline carried 4.5
million passengers in 1998, an increase of 8.8 percent compared
to 1997.(gis)