News
Indonesia acts on air traffic congestion as LCCs continue to expand
September 18th 2015
Indonesia’s transportation ministry is set to issue a regulation on delay management standards that will apply to all airlines operating in the archipelago, the Jakarta Globe has reported. "Transportation minister, Ignasius Jonan, has signed the regulation and it is awaiting promulgation by the Law and Human Rights Ministry," Suprasetyo, director-general of air transportation at the ministry, said on Tuesday. Read More » Suprasetyo added the new regulation sets forth a supervisory presence of responsible stakeholders in each instance of flight delay.
The ministry will be empowered to audit airlines' standard operating procedures (SOP) related to crisis management to prevent a repeat of prolonged delays that passengers aboard low-cost carrier Lion Air had to endure in February. "I have ordered inspectors who verified Lion Air's crisis management SOP to extend their probe to all airlines," Suprasetyo added.
Indonesia last week abandoned a punitive policy that had forced low-cost carriers (LCCs) to charge higher prices. The rollback, which will become effective on September 28, permits LCCs to sell tickets for as low as 30% of the maximum fare of full service carriers, rather than the present 40%. The reversal represented a nod to growing business concerns that the weakening Indonesian and Malaysian currencies, coupled with slowing economies, was cutting into profits at Southeast Asia’s carriers. Suprasetyo said the lower price level was intended to bolster consumer purchasing power.
Flag carrier Garuda Indonesia’s budget subsidiary, Citilink, earlier this week said it would lease nine new A320s to boost its domestic network. The carrier has a fleet of 35 A320s, flying to 24 destinations daily across Indonesia. In 2013 it placed an order with Airbus for 25 A320neos. On Thursday, it received its maiden B737-500, transferred from parent Garuda as part of a quartet of older Boeing frames intended to temporarily bridge capacity bottlenecks until the new Airbus aircraft arrive.
In the interim, Indonesian LCCs Indonesia AirAsia X (IAAX) and Batik Air are gearing up to meet projected demand. IAAX will induct its first narrow body jets into its fleet after it signed a contract with the leasing arm of AirAsia, Asia Aviation Capital, for five A320-200s returned from Indonesia AirAsia. Lion Group’s Batik Air is planning to commence international operations out of the tourist town of Manado, a CAPA report has suggested, adding Batik Air was considering linking Manado with Incheon early next year and, pending the issuance of suitable slots, was looking at serving Shanghai from either Bali and/or Balikpapan.
