Meeting to discuss financing for sales of N-250 aircraft

JAKARTA (JP): The country's aircraft manufacturer PT Industri Pesawat Terbang Nusantara (IPTN) will hold a gathering with leasing companies to discuss financing the sales of its 70-seat N-250 aircraft to domestic airlines, an executive says.

"We will invite executives of both foreign and domestic leasing firms to talk about financing arrangements for the N-250 procurement," the company's vice president for business, Heru Santoso, announced at the Shangri-La hotel yesterday.

An executive of Bouraq Airlines, Benny Rungkat, said domestic airlines will seek leasing terms with payments of more than 12 years.

Benny, who is also Secretary General of the Indonesian Association of Commercial Aircraft Companies (Inaca), said that in purchasing used Boeing 737-200 aircraft from Lufthansa worth US$8.9 million each, four domestic airlines get loans with an annual interest rate of 9.5 percent and a repayment period of over 12 years from the state-owned leasing company PT Pann Multi Finance (PMF).

He said that the N-250 aircraft will be priced at $12.5 million to $13.5 million each and Bouraq has ordered five aircraft with an option to increase the purchase to 62 aircraft by the end of the country's second long-term (25-year) development plan period, beginning this year.

Benny also stressed the necessity to extend the runways of a number of airports in Indonesia to, at least, 1,300 meters because "many runways in the country currently are only 800 meters in length, too short for N-250 airplanes."

Another executive of IPTN, Djoko Sartono, however, said that some 80 percent of airports in Indonesia are able to land the N- 250 turboprop aircraft.

"We don't have to expand all the airports because we have CN- 235 planes to service airports with short landing strips," he said.

CN-235 is a smaller airplane with 50 seats produced by IPTN jointly with CASA of Spain.

U.S. plant

In yesterday's meeting, the first ever held by IPTN to introduce the N-250, a deputy chairman of the Management Board of Strategic Industries (BPIS), Paramajuda, said that the company will soon set up an assembly plant in the United States, whose products will likely be considered as American aircraft.

"The N-250 will use components made in the United States but designed by Indonesia," he said.

He said less than 10 percent of the components in aircraft made by its competitors, such as ATP of Britain and ATR of France, are made in the United States.

N-250's rivals include Sweden's Saab 2000 and Germany's Dornier 338, he said.

The N-250 is due to enter commercial service in 1996. A prototype of the first Indonesian-designed aircraft is scheduled to be introduced on Nov. 10 in Bandung to coincide with the second leadership meeting of the Asia Pacific Economic Cooperation (APEC) forum in Bogor, West Java. The aircraft will fly next April and be internationally certified in 1997.

IPTN, which is supervised by BPIS, is now considering one of three American sites, Oregon, Arizona or Alabama, for it's assembly plant. Half of its products will be marketed in the U.S. and Canada.

IPTN's plant in Bandung already assembles and produces parts for fixed-wing aircraft such as the C-212 and CN-235 as well as helicopters such as the NBO-105, NAS-332, Bell 412 and Superpuma. It spent more than $500 million to develop the N-250, including $185 million derived from the interest of reforestation funds. (icn)