Indonesia’s Pacific Royale Airways is set to launch next month as a full-service carrier operating on domestic as well as international routes, a segment that is currently dominated by national airline Garuda Indonesia as reported by TTG Asia.
Pacific Royale Airways CEO Samudra Sukardi -the former Vice President of the Garuda Indonesia Group- said: “Our mission at Pacific Royale Airways is to enter Indonesia’s market to address the public concerns in flight safety, punctuality and good services.”
Due to receive its Air Operator’s Certificate in mid-March, the airline has so far been granted approval to launch routes from four Indonesian hubs including Bandung, Surabaya and Jakarta, and to operate 62 domestic and 11 international city pairs. International destinations such as Mumbai, Singapore, Hong Kong and Kuala Lumpur are on the cards. They will be based in Jakarta with branches in Surabaya, Batam and Medan. Those three cities will form a connective network of connections to several cities in the vicinity.
Domestic operations will start with two Airbus A320-200 aircrafts, while two Fokker 50 planes will be deployed to serve feeder destinations within the country. Three additional Fokker 50s and two more Airbus A320s will arrive in May, with an Airbus A330 aircraft scheduled to arrive by year-end.
Seriousness in the premium class is shown by the work with entertainment and communications design firm from the United States, Lumexis Corporation. In addition, Pacific Royale Airways has also partnered with Abacus International to handle information technology, especially in Internet-based ticketing system, which will allow travel consultants within the Abacus network to access its published fares and inventory.
“As we plan to operate domestic flights and potential international flights to Asia, we hope to leverage on Abacus’ network to drive sales and yield,” explained Samudra.
Pacific Royale Airways’ Chairman, Tarun Trikha said they were optimistic the passenger market in Indonesia is on the rise. "We will take the upper middle class market big enough. Indonesia is the most populous country after China, India, and the United States. Growth upper middle class is quite high," said Tarun.
Monday, February 27, 2012
Tuesday, February 21, 2012
Garuda puffs up its expansion strategy
GARUDA Indonesia shareholders approved earlier this month a motion to buy 97 new aircraft by 2016, a huge jump over the 36 planes it was originally planning to add to its fleet.
Under the beefed-up expansion programme, Garuda will purchase 20 Boeing B737-800NGs, 24 Airbus A330-200s, 25 five narrow-bodied aircraft for Garuda Citilink, and 18 sub-100 seat aircraft. An original order for 10 Boeing B777-300ERs for longhaul operations will remain or switch to other similar aircraft.
Garuda vice president corporate communications Pujobroto said: “Garuda earlier announced through the Quantum Leap Programme that it would operate 154 aircraft by 2015.”
“With the new fleet expansion programme, Garuda will operate 194 aircraft comprising of 24 A330s, nine B777s, 85 B737-800NGs, 50 A320s for Citilink, 25 Sub-100s and three freighters by 2015.”
According to Pujobroto, the enhanced fleet expansion was in anticipation of significant increases in airline passengers, both domestically and internationally.
“It is also part of Garuda’s efforts to boost efficiency, as the new aircraft are more fuel-efficient and environment friendly," he explained. "Their maintenance cost is also lower."
Under the beefed-up expansion programme, Garuda will purchase 20 Boeing B737-800NGs, 24 Airbus A330-200s, 25 five narrow-bodied aircraft for Garuda Citilink, and 18 sub-100 seat aircraft. An original order for 10 Boeing B777-300ERs for longhaul operations will remain or switch to other similar aircraft.
Garuda vice president corporate communications Pujobroto said: “Garuda earlier announced through the Quantum Leap Programme that it would operate 154 aircraft by 2015.”
“With the new fleet expansion programme, Garuda will operate 194 aircraft comprising of 24 A330s, nine B777s, 85 B737-800NGs, 50 A320s for Citilink, 25 Sub-100s and three freighters by 2015.”
According to Pujobroto, the enhanced fleet expansion was in anticipation of significant increases in airline passengers, both domestically and internationally.
“It is also part of Garuda’s efforts to boost efficiency, as the new aircraft are more fuel-efficient and environment friendly," he explained. "Their maintenance cost is also lower."
Tuesday, February 14, 2012
AirAsia Introduces Kuala Lumpur-Semarang Flights
AIRASIA has launched daily services between Kuala Lumpur and Semarang, the capital of Central Java, bringing 160 passengers on its maiden flight on February 6.
AirAsia Indonesia president director Dharmadi said: “(Semarang) marks AirAsia’s fourteenth destination (in Indonesia) from Kuala Lumpur.”
The carrier also connects Kuala Lumpur to Jakarta, Surabaya, Medan, Jogjakarta, Bandung, Denpasar, Solo, Balikpapan, Palembang, Aceh, Perkanbaru, Padang and Makassar.
Dharmadi said the Kuala Lumpur-Semarang route had the potential to galvanise the Malaysian outbound market to Semarang, and added that AirAsia was also looking to target transit traffic from China, South Korea and Japan.
“We are working on the China market (especially from) Beijing. In fact, there were passengers from Guangzhou on our maiden flight,” he said.
Meanwhile, AirAsia is scheduled to start twice-daily Jakarta-Semarang services from March 9.
AirAsia Indonesia president director Dharmadi said: “(Semarang) marks AirAsia’s fourteenth destination (in Indonesia) from Kuala Lumpur.”
The carrier also connects Kuala Lumpur to Jakarta, Surabaya, Medan, Jogjakarta, Bandung, Denpasar, Solo, Balikpapan, Palembang, Aceh, Perkanbaru, Padang and Makassar.
Dharmadi said the Kuala Lumpur-Semarang route had the potential to galvanise the Malaysian outbound market to Semarang, and added that AirAsia was also looking to target transit traffic from China, South Korea and Japan.
“We are working on the China market (especially from) Beijing. In fact, there were passengers from Guangzhou on our maiden flight,” he said.
Meanwhile, AirAsia is scheduled to start twice-daily Jakarta-Semarang services from March 9.
Tuesday, February 7, 2012
Tiger Airways completes 33% investment in Mandala
Tiger Airways Holdings Limited (Tiger Airways) announced the completion of a 33% investment in the Indonesian firm PT Mandala Airlines (Mandala) in Singapore, Tiger Airways CEO Chin Yau Seng said on Tuesday.
Tiger Airways’ investment in Mandala will be held through its wholly-owned subsidiary in Singapore, Roar Aviation Pte. Ltd.
Mandala has undergone a financial restructuring process in accordance with Indonesian law. The largest shareholder in the restructured Mandala will be the Saratoga group, which will hold a 51.3% stake. The remaining 15.7% will be held by the previous shareholders and creditors of Mandala.
The next stage of the process is to reactivate Mandala’s Air Operators Certificate (AOC), which has been frozen since the suspension of its operations in Jan. 2011. The AOC is expected to be reactivated in February, after which flight sales will commence ahead of the resumption of flights in April.
The restructured airline will adopt the Tiger Airways business model, and plans to offer low fare travel to international and domestic destinations in Indonesian within a 5-hour flying radius. Like other airlines in the Tiger Airways Group, the restructured airline would also operate Airbus A320 aircraft.
Further information on the number of aircraft, the initial routes and destinations will be announced once all approvals have been granted by the regulators and authorities.
“We are pleased to have completed this transaction and are excited about the re-launch of Mandala’s operations once its AOC has been reactivated,” said Chin Yau Seng in a written statement.
“Mandala is the first of Tiger Airways’ joint venture “Cubs” and represents a significant step in our efforts to expand our “paw-print” in this region.”
Sandiaga Uno, founding partner of Saratoga group said, “We are delighted by the successful completion of this investment with our valued partners. We take great pride in helping to return Mandala, a well-loved Indonesian icon, to the skies of Indonesia.”
Tiger Airways’ investment in Mandala will be held through its wholly-owned subsidiary in Singapore, Roar Aviation Pte. Ltd.
Mandala has undergone a financial restructuring process in accordance with Indonesian law. The largest shareholder in the restructured Mandala will be the Saratoga group, which will hold a 51.3% stake. The remaining 15.7% will be held by the previous shareholders and creditors of Mandala.
The next stage of the process is to reactivate Mandala’s Air Operators Certificate (AOC), which has been frozen since the suspension of its operations in Jan. 2011. The AOC is expected to be reactivated in February, after which flight sales will commence ahead of the resumption of flights in April.
The restructured airline will adopt the Tiger Airways business model, and plans to offer low fare travel to international and domestic destinations in Indonesian within a 5-hour flying radius. Like other airlines in the Tiger Airways Group, the restructured airline would also operate Airbus A320 aircraft.
Further information on the number of aircraft, the initial routes and destinations will be announced once all approvals have been granted by the regulators and authorities.
“We are pleased to have completed this transaction and are excited about the re-launch of Mandala’s operations once its AOC has been reactivated,” said Chin Yau Seng in a written statement.
“Mandala is the first of Tiger Airways’ joint venture “Cubs” and represents a significant step in our efforts to expand our “paw-print” in this region.”
Sandiaga Uno, founding partner of Saratoga group said, “We are delighted by the successful completion of this investment with our valued partners. We take great pride in helping to return Mandala, a well-loved Indonesian icon, to the skies of Indonesia.”
Sunday, February 5, 2012
Garuda Gets Approval to Purchase More Airplanes
State-owned flag carrier Garuda Indonesia obtained shareholder approval on Friday to spend the remaining proceeds of last year’s initial public offering (IPO) to finance the purchase of up to 97 new planes.
The company had planned to use funds from the IPO to finance 36 planes — consisting of 10 Boeing 737-800NGs, 10 Boeing 777-300 ERs, six Airbus 330-200s, five narrow-body planes for Garuda’s low-cost branch Citilink and five sub-100 seat jets.
However, under new fleet development plans approved by shareholders, Garuda is planning to spend the funds on 20 Boeing 737-800NGs, 10 Boeing 777-300 ERs, 21 Airbus 330-200s, 25 narrow-body planes and 18 sub-100 seat jets.
The company will use a payment scheme of 24 monthly installments before taking delivery of the new planes, which will bring the company’s fleet to 194 in 2015.
“We initially planned to use IPO funds to finance the purchase of several planes until their delivery in 2014. Now, we will spend all remaining IPO funds this year to finance the down payments and installments on more new planes,” Garuda finance director Elisa Lumbantoruan said after the shareholders meeting.
Elisa said that the new fleet-development plan was part of Garuda’s austerity measures.
“If we didn’t use IPO funds, we would only put them on deposit while looking for other financing to buy planes, which were not included in previous IPO funds plans. We would be burdened by interest payments higher than we would gain from our deposits,” Elisa said.
Garuda earned about Rp 3 trillion (US$333 million) during its IPO last year. According to its business plan, Garuda will use 80 percent of the IPO funds to buy new planes and the remaining 20 percent on capital expenditure.
Garuda’s president director Emirsyah Satar said that his company’s unrealized IPO funds currently stood at Rp 1.78 trillion.
“We still have Rp 1.39 trillion to develop our fleet,” Emirsyah said.
Garuda will use the funds to pay this year’s down payments and security deposits amounting to $430 million for the new planes, according to Elisa.
“The remaining payments will be supported from our operational free cash flow, expected to reach Rp 2.7 trillion this year. We will look for bank loans to provide the remaining funds,” Elisa said.
He added that Garuda had already obtained principal approval from commissioners to seek loans of up to $200 million this year. However, Garuda is expecting that a new flight booking system will help the company to secure higher free cash flow, which will reduce the amount needing to be borrowed.
“We estimate additional cash flow of Rp 500 billion to Rp 1 trillion,” Elisa said. He added that additional free cash flow would be supported by changes in flight-booking culture.
“At this moment, most people book flights seven days before departure. If we can encourage them to book flights three or six months before departure, we will secure more funds. How much we obtain will determine whether we will have to look for the maximum $200 million in loans,” he said.
Elisa also confirmed on Friday that the company was in negotiations with Canadian plane maker Bombardier for the purchase of sub-100 seat jets.
“However, these are negotiations. There is no guarantee that we can come to an agreement. There may be no deal achieved,” Elisa said.
He said that Garuda needed longer to decide whether to purchase the sub-100 seat jet from Bombardier or Embraer as the company had little experience in handling such planes. “We are experienced in purchasing Airbus or Boeing,” he said.
The company had planned to use funds from the IPO to finance 36 planes — consisting of 10 Boeing 737-800NGs, 10 Boeing 777-300 ERs, six Airbus 330-200s, five narrow-body planes for Garuda’s low-cost branch Citilink and five sub-100 seat jets.
However, under new fleet development plans approved by shareholders, Garuda is planning to spend the funds on 20 Boeing 737-800NGs, 10 Boeing 777-300 ERs, 21 Airbus 330-200s, 25 narrow-body planes and 18 sub-100 seat jets.
The company will use a payment scheme of 24 monthly installments before taking delivery of the new planes, which will bring the company’s fleet to 194 in 2015.
“We initially planned to use IPO funds to finance the purchase of several planes until their delivery in 2014. Now, we will spend all remaining IPO funds this year to finance the down payments and installments on more new planes,” Garuda finance director Elisa Lumbantoruan said after the shareholders meeting.
Elisa said that the new fleet-development plan was part of Garuda’s austerity measures.
“If we didn’t use IPO funds, we would only put them on deposit while looking for other financing to buy planes, which were not included in previous IPO funds plans. We would be burdened by interest payments higher than we would gain from our deposits,” Elisa said.
Garuda earned about Rp 3 trillion (US$333 million) during its IPO last year. According to its business plan, Garuda will use 80 percent of the IPO funds to buy new planes and the remaining 20 percent on capital expenditure.
Garuda’s president director Emirsyah Satar said that his company’s unrealized IPO funds currently stood at Rp 1.78 trillion.
“We still have Rp 1.39 trillion to develop our fleet,” Emirsyah said.
Garuda will use the funds to pay this year’s down payments and security deposits amounting to $430 million for the new planes, according to Elisa.
“The remaining payments will be supported from our operational free cash flow, expected to reach Rp 2.7 trillion this year. We will look for bank loans to provide the remaining funds,” Elisa said.
He added that Garuda had already obtained principal approval from commissioners to seek loans of up to $200 million this year. However, Garuda is expecting that a new flight booking system will help the company to secure higher free cash flow, which will reduce the amount needing to be borrowed.
“We estimate additional cash flow of Rp 500 billion to Rp 1 trillion,” Elisa said. He added that additional free cash flow would be supported by changes in flight-booking culture.
“At this moment, most people book flights seven days before departure. If we can encourage them to book flights three or six months before departure, we will secure more funds. How much we obtain will determine whether we will have to look for the maximum $200 million in loans,” he said.
Elisa also confirmed on Friday that the company was in negotiations with Canadian plane maker Bombardier for the purchase of sub-100 seat jets.
“However, these are negotiations. There is no guarantee that we can come to an agreement. There may be no deal achieved,” Elisa said.
He said that Garuda needed longer to decide whether to purchase the sub-100 seat jet from Bombardier or Embraer as the company had little experience in handling such planes. “We are experienced in purchasing Airbus or Boeing,” he said.
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