Airlines Might Go Bankrupt If Airfares Not Raised: Jusuf Kalla
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14 January 2019 16:04 WIB
TEMPO.CO, Jakarta - Vice President Jusuf Kalla said he could comprehend airlines' decision to raise their airfares, among them given the US dollar exchange rate to the rupiah, which would hugely affect a carrier’s expense on maintenance and fuel purchases.
“We are aware that the carriers purchase planes and fuel with US dollars, but the tariff is in rupiah. This has forced them to make gradual adjustments,” said Jusuf Kalla when opening a seminar and dialogue with the Indonesian State University Alumni Association (Himpuni) today.
Read: Transportation Ministry Responds Petition for Lower Airfare
He added the airfare hike was necessary to keep the airlines' operations in the move amid stronger US dollar against the rupiah. Kalla explained forcing carriers to offer cheap airfares would undermine the industry and lead to bankruptcy.
“If it were not adjusted, we could enjoy it now but we would also know how many companies would go bankrupt or stop their operations,” he said.
Previously, a number of domestic carriers decided to raise their airfares, sparking complaints from consumers. The Indonesia National Carriers Association (INACA) finally reduced the airfares in the wake of public outcries despite weakening rupiah, which stood at Rp14,048 per US dollar on Monday morning.
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