Merpati to continue negotiations on leasing

Merpati to continue negotiations on leasing

JAKARTA (JP): The new president of Merpati Nusantara, Budiarto
Subroto, said yesterday that the company will continue
negotiations with PT Arthasaka Nusaphala on the controversial
leasing of 16 locally-made CN-235-200 aircraft.

"Using domestic products is our priority. We will soon
complete negotiations based on commercial calculations," Budiarto
said after a ceremony transferring Merpati's management from his
predecessor, Ridwan Fataruddin.

Budiarto, 51, was formerly the commercial director of the
airline and an assistant to Minister of Transportation Haryanto
Dhanutirto. He was officially installed as Merpati's president
last Friday, replacing the 57-year-old Ridwan.

Speculation of Ridwan's replacement ran rampant after he
announced last month that Merpati would not lease the 16 CN-235-
200 aircraft because the monthly leasing fee of US$110,000 per
unit was commercially unfeasible.

Budiarto said yesterday that negotiations with Arthasaka are
continuing and Merpati is preparing to expand its routes.

"We are considering to open more routes, for instance, from
Palembang in South Sumatra to other cities on the island, like
Pangkalpinang, Jambi, Lhokseumawe and Gunung Sitoli," he said.

Strategy

Budiarto declined to comment on Ridwan's suggestion that the
government purchase part or all of the 16 CN-235-200 aircraft and
confer them to Merpati -- as the government does with the 14 CN-
235-10s currently operated by the airline.

"I must study the proposal thoroughly," he said.

Director General of Air Transportation Zainuddin Sikado
recently divulged that the 16 CN-235-200s must be leased because
the government does not have the money to buy them.

Budiarto pledged yesterday that he will improve Merpati's
performance, including its service and financial structure.

"We will consolidate by increasing the utilization rates of
our fleet, safety, on-time schedules and professionalism," he
promised. "We will also improve our alliances with other
transportation firms, including Garuda Indonesia, our parent
company."

He added that the company plans to simplify its fleet to cut
expenses.

Merpati now operates nine different types of aircraft, the
Boeing 737-200, ATP, Casa-212, Twin Otter, Fokker-28, Fokker-27,
Fokker-100, CN-235 and DC-9. (icn)