Govt to link Garuda, Merpati operations

The Jakarta Post,  Jakarta, 14 March 2009 

The Office of State Enterprise Ministry has formed a special team that will synergize operations of state airlines Garuda Indonesia, Merpati Nusantara and Pelita Air Service in a bid to boost efficiency, Secretary to the State Enterprises Minister Said Didu says. 

He said aircraft maker PT Dirgantara Indonesia will also join the airline synergy to help provide aircraft, spare parts, and maintenance. 

"The team will focus on synchronizing the service and operation of state airlines and their supporting companies. This will include ticketing, flight routes, and maintenance," said Said, adding the new system would be applied this year. 

Under the program, Garuda and Merpati could share routes and function as feeders to each others under one ticketing system. 

Said said with the new system, passengers who wanted to use Garuda and Merpati services could use just one ticket for routes mostly serving cities in the central and eastern part of Indonesia. 

"Garuda serves international and some local routes, while Merpati serves mostly eastern Indonesian routes which Garuda does not serves," said Said. 

"After Garuda has landed, Merpati will be ready to take-off and carry the passengers to the next destination." 

Said said that this new system would also boost the airlines efficiency and increase their profits. 

"Certainly this will increase services and profit, but the efficiency figures will have to wait until the system is operational," he said. 

Garuda is estimating a 30 percent increase in net profits this year from Rp 683.6 billion (US$57.4 million), last year. The airline will boost its services by renting eight new airplanes from Dubai Aerospace Enterprise (DAE) and introducing new cargo services as well as new domestic and international routes. 

Merpati, on the other hand, is still caught in a contract row involving the purchase of 15 turbo propeller aircraft from China's Xi'an Aircraft Industry after recording a loss of more than Rp 5 billion ($416,000). 

The ailing company aims to record only Rp 70 billion ($5.88 million) in net profits this year by cutting its capital expenditure to practically zero. 

Merpati is now under a restructuring program of the Asset Management Company (PPA) - the state-sanctioned company tasked to restructure ailing state firms. 

Said also said Dirgantara would cooperate with the Garuda maintenance facilities to help support efficiency in the operation of Garuda and Merpati. 

As for Pelita Air, a unit of state oil and gas company PT Pertamina, the ministry plans to boost its business as a chartered airline for the private sector, especially for energy and mining businesses. 

Indonesia's airline industry is fairly immune to the worsening global economic crisis as it mostly relies on a thriving and expanding market for domestic travellers rather than on international passengers. 

According to the Transportation Ministry, domestic passenger numbers last year reach 46.34 million, up by 18.3 percent from 39.2 million last year. Overseas passenger numbers reached 3.37 million, up by 5.64 percent from 3.19 million in 2007. 

The ministry forecast a 20 percent growth in passengers this year. 

Indonesian airlines have been able to maintain their load factor by an average of 80 percent last year despite rising ticket prices. 

This year's load factor is forecast to work out the same as last year.

Last year, indonesia had 14 airlines operating 739 airplanes, a 36.3 percent increase on the 542 planes available for service in 2007. The airlines serve 167 domestic routes connecting 87 cities. (fmb)