Air Carriers Warned to Lower Airfares, Minister Hints New Decree



Laila Afifa

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  • Transportation Minister Budi Karya Sumadi. TEMPO/Chitra Paramesti

    Transportation Minister Budi Karya Sumadi. TEMPO/Chitra Paramesti

    TEMPO.CO, Jakarta - Transportation Minister Budi Karya Sumadi plans to compose and issue a decree overseeing airfares established by Indonesian air carriers if he yet sees a drop in ticket prices.

    “It will come in the form of minister’s decree (SK). I will enforce it if [air carriers] still don’t lower their ticket prices,” said Budi Karya at the Jakarta Convention Center, Central Jakarta, on Wednesday, April 3.

    The regulation, if issued, is said to take the form of transportation minister’s decree No.72/2019, and will oversee airfares based on its subclasses.

    Moreover, he explained that the government will hand full control to 20 percent air carriers to set a full price based on the upper cap while another 20 percent of air carriers will have to enforce ticket prices 70 percent from the upper price cap. Meanwhile, the rest will be completely decided by the government.

    The transportation minister explained that currently, there are only two major airline groups that have lowered their airfares, with state-carrier Garuda Indonesia that operates Citilink, Sriwijaya, and NAM; and another one is Lion Air Group that consists of Wings Air, Batik Air, and Lion Air.


    Read: Gov't to Evaluate Implementation of New Regulations on Airfare