Garuda Indonesia Closes Routes to Ease Financial Burden

TEMPO.CO, Jakarta - Flag carrier Garuda Indonesia has recently closed flight routes at a number of airports, including Batam, Jambi, and North Sulawesi following the drop in the number of passengers.

"We have a heavy burden. As a state-owned company, Garuda is not only seeking profit," said the airline group’s operational director Bambang Adisurya Angkasa during a joint meeting with the House of Representatives (DPR) Commission V at the Parliament complex, Senayan, Jakarta, Monday, November 25.

In addition to providing regular commercial transportation, Bambang said the airline was mandated to serve flights to remote areas which its operating costs are generally from a cross-subsidy.

According to Bambang, to fly regular transportation to areas with low-frequency flights, his corporate needed to have an agreement with the regional government. For example, the flight route from Jakarta to Nias.

"Nias Regent gives us a guarantee and asked us to support local tourism. So now we need to consolidate with regents to make agreements and stakeholders," he added.

Garuda Indonesia was also rearranging routes to main destinations, such as Denpasar, Surabaya, and Balikpapan, at various airports in a bid to optimize services, boost the passenger capacity, and increase the flight slots.

On the same occasion, Transportation Minister Budi Karya Sumadi said the route closure was attributable to the high price of jet fuel or avtur that had different price benchmarks in each region.

"And it is also because of the low load factor of several routes, namely Manado, Naha, Melangguane, Mingas, Kao, and Marowali-Kendari," he added.

Budi Karya promised that he will meet State-Owned Enterprises (SOE) Minister Erick Thohir for discussion to rebalance the price of avtur to reduce airline costs.

FRANCISCA CHRISTY ROSANA