Garuda Indonesia to Downgrade Services over Lower Airfares

TEMPO.CO, Jakarta - State-owned air carrier Garuda Indonesia planned to apply operational or production efficiency to offset lower airfares by means of downgrading passenger services. 

“We must reduce our in-flight and ground handling services,” corporate marketing director Pikri Ilham Kurniansyah told Tempo on Friday, May 17.

The in-flight components refer to services rendered to passengers on board, such as magazines, newspapers, heavy meals, snacks, beverages, and other entertainments. Meanwhile, ground handling components refer to services on the ground such as baggage, cargo, post, and others.

Pikri ensured the efficiency would not affect passenger safety. “We don’t take safety for granted. No safety services are downgraded,” Pikri said. 

Read: Air Carriers Reluctant to Drop Airfare despite Tariff Revised

He added the airline would maintain its pilot training program, aircraft maintenance costs, and costs for workers or cabin crew. “We will not dismiss any worker,” he added.

Garuda Indonesia decided to slash its operational costs to lower its airfares following the issuance of the Transportation Minister's Decree No. 106/2019 on the airfare price ceiling that was lowered by 12-16 percent.

The new regulation will reportedly reduce airlines’ revenue by 7-8 percent. “So we boost other sources of income [from advertisements and cargo service],” Pikri concluded.

FRANCISCA CHRISTY ROSANA