Air Asia Indonesia Starts Bali to Yogyakarta Service June 8, 2012

Jakarta Post reports that Air Asia Indonesia will launch a new flight service between Yogyakarta and Bal starting on June 8, 2012.

Garuda Indonesia has called on the Indonesian government to fulfill its promise to develop the country’s airport infrastructure.

“If the government doesn’t build new airports, it’s going to be a challenge for us,” Garuda President Director Emirsyah Satar told delegates May 8 at the International Society of Transport Aircraft Trading (ISTAT) Asia conference in Singapore.

According to Satar, the development of new airports is one of the primary factors in the government’s plan to revive the county’s economy; however, he notes that “we still have to see if the execution is there.”

The country’s main airport, Jakarta Soekarno-Hatta International Airport, was built to handle 22 million passengers a year, but in 2011 51 million passengers passed through the airport, according to comments made by Indonesia’s director general of civil aviation, Herry Bhakti Gumay.

To accommodate this demand, the government has unveiled a plan to build Karawang International Airport, east of the capital city, with construction due to start in 2015 and to be completed in 2019. The new airport initially will support 20 million passengers a year but this will eventually grow to 70 million passengers, says Gumay. The existing airport also is due to be expanded, but it is unclear when construction work will get under way.

Meanwhile, Garuda is seeking financing for the Boeing 737-800s, 777-300ERs and Airbus A330s it has on order. “We’ve already done the financing for aircraft to be delivered through to the end of 2013, but are now looking for financing” for aircraft to be delivered in 2014 and 2015, says Satar, adding that requests for proposals for some of the A330s and 777s are coming. Garuda favors sale and leaseback agreements, says Satar.

http://www.aviationweek.com

“The challenges are huge, but this will pave the way for a breakthrough,” said Agung Prabowo, president director of Graha Banten Lampung Sejahtera, the Indonesian consortium behind the project. “We’re not out to break any records, but we want the bridge realized, as it will benefit people on both sides.”

His consortium brings together the provincial governments of Lampung in Sumatra and Banten in Java, as well as a subsidiary of the Artha Graha conglomerate run by tycoon Tommy Winata. It was set up to lay the groundwork for the bridge in 2007.

It is now waiting for a legal guarantee from the Indonesian government, which is expected to come within weeks. The government is eager for foreign investors to take part in building bridges, highways and other facilities to spur the economy.

The 30km bridge had been envisioned by the country’s first president Sukarno since the 1960s, but only recently did steady economic growth make its construction more realistic.

A feasibility study is in the works, and construction is to start in 2014.

The bridge will link 80 per cent of Indonesia’s 240 million people by road and rail, and will take some 10 years to complete. The world’s largest ships will be able to pass under it, as the bridge will stand 80m at its highest.

Indonesia’s longest bridge at present is the 5.4km-long Suramadu Bridge, completed in 2009, that links Surabaya in East Java with the island of Madura. It, too, was built by a consortium of Indonesian and Chinese companies over six years.

Officials on both sides of the strait near where the new bridge will start — in Anyer, Java and Bakauheni, Sumatra — are already gearing up for it, with the Banten and Lampung governments publicizing the bridge to attract investors to set up shop there.

The connection will also intentionally start at Anyer, 40km south of the port of Merak, from which most ferries to Sumatra currently operate.

Geologists and disaster management officials have given the all-clear to the proposed design, by renowned Indonesian architect Wiratman Wangsadinata, which would be able to withstand an earthquake of magnitude 9 as well as eruptions of the Anak Krakatau volcano some 50km away. It was formed after the 1883 eruption of Krakatoa.

“The Sunda Strait is likely to be the site of a major earthquake,” Professor Masyhur Irsyam of the Bandung Institute of Technology said this week. “But this is only a problem if structures are not designed to be strong enough to resist it.”

The bridge will also be 200km from the undersea fault where the Indo-Australian and Eurasian plates meet. As a result, the impact of a tsunami on the bridge will be limited, according to simulations, National Disaster Management Agency spokesman Sutopo Purwo Nugroho said.

But forget about hiking across the bridge for now: Winds at the strait are often fierce, and the crossing by ferry can stretch up to four hours.

In its report on the deal, the Beijing Review cited China Institute of International Studies president Qu Xing as saying that there is great demand for funds and technology in Indonesian infrastructure.

“China is highly experienced in building railways, highways, bridges and irrigation projects, and considers Indonesia one of its major prospective investment destinations,” it said.

(The Straits Times)

Europe’s Airbus and US manufacturer Boeing have secured billions of dollars in orders over the past year as Southeast Asia’s largest economy experiences a travel boom and looks to link its archipelago of more than 17,000 islands.

Indonesian carrier Lion Air placed the single largest contract in commercial aviation history during a November visit by US President Barack Obama, ordering 230 Boeing aircraft for a whopping $22.4 billion.

Last week, Airbus bagged a $2.5 billion contract for 11 A330-300s to national carrier Garuda International during a visit to Indonesia by British Prime Minister David Cameron.

“There’s a major transformation going on, not just with Garuda but with the whole aviation industry in Indonesia,” industry analyst Gerry Soejatman told AFP.

“Around 60 million, or a quarter the population, travel domestically by air annually. That number could easily double if the price is right,” he said.

The deal with Airbus was part of Garuda’s plans to expand services less than two years after the European Union lifted a ban on the airline from entering its airspace, citing the country’s poor safety record.

“We’re seeing two things meeting harmoniously — first a rise in economic power spreading across the demographic. Many more people have reached an economic threshold that allows them to fly,” Sydney-based Center for Asia Pacific Aviation Chairman Peter Harbison told AFP.

“At the same time, more airlines are coming in, and are basically flying to your doorstep at a much lower price. Put those two things together and you have a recipe for enormous growth.”

Western airlines meanwhile have faced a downturn, with the aviation industry in Europe taking a hit from the 2008-09 financial crisis.

Air travel demand in Europe has started to creep up again, but Fitch Ratings said in a statement earlier this year it expected poor demand in 2012 and European airlines focusing on minimizing losses.

It forecast “significant retrenchment for the largest European network airlines” such as Air France-KLM, which lost 700 million euros ($925 million) in 2011.

In Indonesia, the economy is projected to grow 6.5 percent this year and per capita income surpassing $3,000. More of its 240 million people are paying for the convenience of air travel over tiresome and often unsafe ferry rides.

Earlier this month, defunct airline Mandala made a comeback with significant investment from Singapore’s Tiger Airways.

New carrier Pacific Royale Airways, flying domestic and some international routes, is expected to take off later this month.

Indonesia’s aviation industry exploded after the year 2000, with domestic air travel increasing by about 500 percent, Harbison said, adding that the industry has marked steady progress since then.

“One of the interesting things about Lion’s order was that other airlines in the region were talking big orders to fly across Asia. In Lion’s case, they were primarily looking to its domestic market.”

Indonesia’s domestic airlines carried 60 million passengers last year, marking a 15 percent growth from the previous year, government figures show.

That is forecast to almost double by 2015, said Indonesia’s official association for all airlines, the Indonesian Air Carriers Association, which works closely with the transport ministry.

But analysts are concerned that the country’s infrastructure may not be able to keep up with the aviation boom, urging the government to expedite plans to expand the Soekarno-Hatta International Airport in the capital Jakarta.

The airport handles more than 44 million passengers a year, and 60 million are expected to come through by 2014.

“Beyond infrastructure, there are two important questions: Where are we going to park all these new planes, and who’s going to fly them?” Soejatman said.

“It’s all well and good to say Indonesia’s aviation industry is growing, but we have to make sure we have the space for it all by the time these extra flights begin. I think it could be a close call.”

Indonesia is also slowly repairing its reputation for poor aviation safety, with six airlines now allowed back in the EU after Brussels slapped a ban on all 51 of the country’s commercial airlines from its airspace in 2007.

Agence France-Presse

The purchase of the A330 jets, worth about $2.5 billion (1.5 billion pounds) and powered by UK supplied Rolls-Royce engines, reflects the growing consumer demand that is attracting political leaders and financiers to court Southeast Asia’s largest economy.

“This deal between Airbus and Garuda Indonesia Airlines is great news for the UK aerospace industry,” Cameron told reporters after arriving in Jakarta on a 24-hour visit.

Cameron’s coalition government is trying to boost British manufacturing to reduce reliance on financial services and to limit exposure to the crisis-hit euro zone by doing more business with fast-growing emerging markets.

Cameron, accompanied by about 35 executives on an Asian tour, has said he sees enormous potential in Indonesia, and the British delegation is expected to focus on possible deals in energy, construction, retail, pharmaceutical, defence and financial services sectors.

The new Airbus jets will increase by two-thirds the number of long-haul A330s already delivered to Garuda or on order from the airline. Its main domestic rival Lion Air in February signed a record $22 billion deal for planes from Boeing Co.

That deal was first announced during a visit to Jakarta by U.S. President Barack Obama. Leaders from China and France also visited last year together with large delegations of executives sniffing for investment opportunities, especially to overhaul Indonesia’s dilapidated infrastructure.

Indonesia is seeing a rapidly expanding aviation sector as a growing middle class, and business executives, opt to travel by air across an archipelago of 17,000 islands. Many islands lack good roads or railways, while ship connections are sporadic and slow, and deadly transport accidents are common.

Many airlines use ageing propeller planes to navigate remote and mountainous eastern provinces such as Papua, where a Garuda plane skidded off the runway on Wednesday. Garuda was removed from a European Union blacklist on Indonesian carriers in 2009.

Garuda’s CEO Emirsyah Satar said he planned to use the new Airbus planes to expand in Asia-Pacific, including to China, South Korea and Australia.

Southeast Asian carriers have ordered $47 billion worth of aircraft for the coming decade.

(Reporting by Olivia Rondonuwu and Mohammed Abbas; Writing by Neil Chatterjee; Editing by Michael Perry)

(Reuters)

Garuda Indonesia plans to buy turboprop aircraft to serve low-density routes in eastern Indonesia.

The carrier is likely to assess either the ATR 72 or Bombardier Q400 aircraft for the requirement, Garuda president and chief executive Emirsyah Satar said at a press conference in Singapore.

“We’ll be operating them [the aircraft], but the question is which entity – will there be a separate branding or will it be part of Garuda,” he says.

Destinations that the carrier is looking at include Kalimantan, Sulawesi and Papua.

“We want to look at the market first and see that there is a demand,” he adds.

Garuda does not operate any turboprop aircraft, while its low-cost subsidiary Citilink is phasing out its Boeing 737 classics and switching to an all-Airbus A320 fleet.

Its turboprop plan will put it in direct competition with low-cost carrier Lion Air, which has a fleet of ATR aircraft that are used by its subsidiary Wings Air on secondary routes.

The plan outlined its goal to fly to all Indonesian islands, a huge ambition from an airline which just started with two Cessna Caravans for carrying lobsters eight years ago.

“Starting next year, we plan to add 10 to 15 planes each year, depending on demand in the market” said Susi Pudjiastuti, the president director of Susi Air. “Indonesia air travel never dies.”

The airline, which specialized in flying small planes — less than 20 seats — servicing small towns and remote areas, now operates a fleet of 47 aircraft, including two helicopters.

Susi said that the new fleet would consist of pioneering airplanes such as the Cessna Caravan and Pilatus Porter, as well as helicopters and Piaggio Avanti for chartered flights.

The airline will need to invest between Rp 220 billion to Rp 330 billion each year for the planes, she said. Currently it is financing its expansion with loans from state-owned lenders Bank Mandiri, Bank Negara Indonesia and Bank Rakyat Indonesia.

“We dream to fly to all destinations in Indonesia,” Susi said.

She said Susi Air would open three new routes in Central Java, from Cilacap to Solo, Semarang and Yogyakarta, in July.

Susi Air has bases that offer scheduled flights in Sumatra, Jakarta, Kalimantan, East Nusa Tenggara and Papua. The airline has yet to serve scheduled flights in Sulawesi.

Susi said that 80 percent of the airline’s flights catered to customers in small towns, acting as a point-to-point commuter or as feeder for bigger airlines.

Susi Air also caters to cargo flights and mining workers who need lifts to remote mining sites.

Serving 35,000 to 40,000 passengers a month, Susi estimates that the airline handles about 15 percent of such routes.

Its competitors include debt-burdened state-owned Merpati Airlines, Aviastar Mandiri Airlines and Trigana Air Service. In terms of volume, Susi Air’s 200 flights a day lose out only to Indonesian heavyweights Lion Air and state-owned flag carrier Garuda Indonesia.

Its fiercest competition has come from land-based companies. Susi Air had to close a Jakarta-Bandung route last year as travel vans provided cheaper fares to the West Java capital.

Investor Daily

Bagus Y. Siregar, Senior General Manager Australia/SWP Garuda Indonesia commented: “We are honoured to receive this award for the second time this year and it encourages us to maintain the high standards we have implemented as we progress towards becoming one of Asia’s leading airlines.”

The Customer Satisfaction survey conducted by research company Roy Morgan, ranked Garuda Indonesia ahead of other leading airlines such as Singapore Airlines, Emirates and Air New Zealand with a monthly satisfaction score of 91 per cent. The recent awards recognise the success of Garuda Indonesia’s Qantum Leap program which includes the revitalisation of the airline’s existing fleet and the introduction of The Garuda Indonesia Experience, the carrier’s service concept that offers a uniquely Indonesian level of service on the ground and inflight. Garuda Indonesia will continue to invest in enhancing its service offerings in order to become a five star carrier by 2015.

For further information, please refer to the Roy Morgan release (also available online:www.newsmaker.com.au/news/15878).

Tundjung Inderawan, director general for railways at the ministry, said the construction was expected to commence in the middle of the year, as the Japan International Cooperation Agency (JICA), which has agreed to fund the project, had approved 10 contractors in the pre-qualification stage.

Then they are scheduled to offer prices in June or July, after which the winner will be chosen and the construction can finally begin.

“This year we will start the construction, so that by mid or end of 2016 Indonesia will have an MRT,” Tundjung said in Jakarta on Wednesday.

The first MRT will span 15.5 kilometers, connecting Lebak Bulus in South Jakarta to the Hotel Indonesia Traffic Circle in Central Jakarta. It will have seven flyovers and six subway stations.

BeritaSatu

Indonesia flagship carrier PT Garuda Indonesia said its net profit last year rose 56% from a year earlier, as the strong local economy helped the airline outperform despite high fuel costs and a slowdown in the industry globally.

Garuda said its load factor, or the percentage of seats filled, rose to 75% at the end of last year from 72% a year earlier, while the strong Indonesian economy helped to boost earnings. Garuda has little exposure to the U.S. and European markets, and Indonesia’s economy expanded 6.5% last year.

The strong results from Garuda come as the global airline industry has been hit by a double whammy of soaring fuel prices and low demand. Some airlines have been cutting back services or raising prices to help cope. Singapore Airlines Ltd. recently reduced cargo capacity by 20% and raised fuel surcharges following a 53% plunge in fiscal third-quarter net profit.

The International Air Transport Association in November cut its forecast for industry profits in 2012 by a quarter to $3.5 billion, but warned that could plunge to a loss of more than $8 billion if Europe’s debt problems trigger another banking crisis.

Garuda, however, said that net profit for the 12 months ended Dec. 31 surged to 805.53 billion rupiah ($87.8 million) from 515.52 billion rupiah in 2010, while revenue jumped 39% to 27.16 trillion rupiah from 19.53 trillion rupiah.

The 69%-government-owned company, which last year raised $578 million in an initial public offering, said its operating profit rose to 1.01 trillion rupiah, reversing from a 67.16 billion rupiah loss in 2010.

Analysts attributed the increase in net profit at the nation’s largest airline by assets to an increase in load factor, mostly from its domestic services.

“Garuda may respond to higher fuel costs by raising ticket fares or improving operating efficiency as it had done in 2008 and again in 2011,” Citigroup said in a recent report.

Citigroup said it expects Garuda’s 2012 net profit to rise to 1.5 trillion rupiah based on jet fuel cost assumption of $115/barrel, compared with the current $134/barrel. That would mark a 86% increase from 2011.

Garuda Chief Executive Emirsyah Satar said in January he expects 2012 operating profit to increase by 21%.

The strong earnings came after Hong Kong-based Cathay Pacific Airways Ltd. reported a 61% drop in 2011 earnings earlier this month and warned that it is bracing for an even tougher year ahead of an uncertain global outlook and persistently high jet fuel prices.

Write to I Made Sentana at i-made.sentana@dowjones.com and Edhi Pranasidhi atedhi.pranasidhi@dowjones.com

wsj.com

PT KAI (Indonesia Train Operator) said that the high-speed train would take just 45 minutes to get from Jakarta to Bandung.

Ignasius said tickets for the trip would be available for passengers at Rp 200,000 (US$22), which would make it affordable for many. Director of cooperation at the National Development Planning Agency (Bappenas) Bastari Panji Indra said that the new Jakarta–Bandung line, which would be ready by 2018, would be part of a public transportation network that would connect a new international airport with the Greater Jakarta area.

The new airport would be constructed in Purwakarta, West Java.

Bastari said that the high-speed train would transport passengers between Jakarta and the new airport in Purwakarta in 20 minutes.

The high-speed rail project is expected to cost Rp 56.108 trillion ($6.17 billion).

(The Jakarta Post)

Namun ada yang perlu digarisbawahi memang bahwa (diluar saya setuju atau tidak tentang pembelian pesawat kepresidenan Boeing BBJ 2) saat ini PTDI (pembuat CN 235 MPA ) belum membuat pesawat bermesin jet. Meski secara kemampuan para insinyur kita mampu, tapi tentu membutuhkan waktu bertahun-tahun di sisi riset dan pengembangan, dan test ini itu, ini tentu menjadi masalah ketika kas negara tidak gemuk. Selain itu, perlu diingat bahwa pesawat jet apapun yang nanti dibuat PTDI, harus juga menguntungkan secara komersial.

Kita perlu melihat bahwa pesawat Boeing BBJ yang dipesan untuk pesawat kepresidenan, adalah seukuran Boeing 737-800 NG milik (spt pswat baru Garuda Indonesia). Dan PTDI tidak mungkin melakukan riset bertahun-tahun hanya untuk membuat 1 unit pesawat kepresidenan saja. Kalau PTDI berniat mengembangkan pesawat seukuran itu, tentu harus dipertimbangkan masak-masak mengenai pasar di dunia, yang saat ini dikuasai oleh Boeing (AS) dan Airbus (konsorsium Eropa). Sementara pesawat jet yang ukurannya lebih kecil, pasarnya sudah diperebutkan oleh dua perusahaan yakni Embraer (Brazil), dan Bombardier (Canada). Belum lagi para pemain baru seperti Sukhoi (Russia) yang meluncurkan SJ 100 dan juga COMAC (China) yang meluncurkan ARJ 21-700. Memang ada pasar dalam negeri, namun jaman sekarang, tentu mustahil kita mengharuskan maskapai-2 nasional HARUS memakai pesawat produksi dalam negeri.

Saya yakin, para insinyur2 Indonesia mampu membangun pesawat jet. Namun perlu dipikirkan secara menyeluruh mengenai,…what’s next. Pemasaran, branding, persaingan dengan para produsen di atas, dan lain lain. PTDI (dulu IPTN) pernah berencana membangun pswt jet seukuran ERJ 21-700 yang dinamai N-2130, namun rencana itu berhenti di tengah jalan karena kebentur krismon.

Diluar pendapat setuju atau tidaknya kita atas pembelian pesawat kepresidenan, tapi perlu dicatat bahwa memang untuk mengangkut presiden dan rombongan,  memang diperlukan pesawat jet berbadan sedang. Tentu lebih pada sisi efisiensi dan efektifitas. Ke depan, kalau memang kita mau PTDI membangun pesawat bermesin jet, mari kita lakukan bersama.

Garuda Indonesia has been named “Best International Airline” in an independent survey of all major international airlines performed by Roy Morgan.

The Roy Morgan Customer Satisfaction Survey ranked the Indonesian flag carrier ahead of other leading regional full-service carriers such as Singapore Airlines, Emirates and Air New Zealand when 91% of 3,943 respondents checked “very satisfied” when quizzed on Garuda’s products and services.

Quoted in The Jakarta Post, Bagus Y. Siregar, Garuda Indonesia’s senior general manager for Australia and the South West Pacific said: “We are thrilled to receive this award, as it endorses Garuda Indonesia’s transformation and progress toward becoming one of Asia’s leading airlines. This valuable recognition by our Australian customers motivates us even further to deliver the highest standards of service on the ground and in the air.”

Garuda was also recently cited at the “World’s Most Improved Airline” in the Skytrax World Airline Awards in Hamburg, Germany.

In January Garuda Indonesia won the “Indonesia Most Admired Companies”Award” from Fortune Indonesia Magazine, recognizing the airline’s success in its transformational program.

The “Indonesia Most Admired Companies” award is based on surveys and researches as well as the public’s assessment of companies in Indonesia, which covers a number of aspects, including leadership, management system, innovation, financial performance, corporate social responsibilities (CSR), human resources development, the company’s readiness in “going global” and development of managerial team.

The customer satisfaction survey, conducted by research company Roy Morgan, ranked Garuda Indonesia ahead of other leading airlines, such as Singapore Airlines, Emirates and Air New Zealand with 91 percent of the 3,943 respondents being “very satisfied” with the airline’s products and services.

“We are thrilled to receive this award, as it endorses Garuda Indonesia’s transformation and progress toward becoming one of Asia’s leading airlines. This valuable recognition by our Australian customers motivates us even further to deliver the highest standards of service on the ground and in the air,” Bagus Y. Siregar, Garuda Indonesia’s senior general manager for Australia and the South West Pacific, said in a statement sent to The Jakarta Post on Tuesday.

The Roy Morgan Customer Satisfaction Award comes after a string of accolades, including the four-star rating by Skytrax, the global benchmark for airline service standards, in 2009.

Garuda Indonesia was also named the World’s Most Improved Airline at the Skytrax World Airline Awards in Hamburg, and Asia’s leading service quality airline by the Center for Asia-Pacific Aviation (CAPA) in 2010.

All awards recognize the success of Garuda Indonesia’s Qantum Leap program, which includes the revitalization of its existing fleet and the introduction of “The Garuda Indonesia Experience”, the carrier’s service concept that offers a uniquely Indonesian level of service both in-flight and on the ground.

“Garuda Indonesia will continue to invest in enhancing its service offerings in order to become a five-star carrier by 2015,” Siregar said. (nfo)

Virtually unknown outside its home base, Lion Air has committed to 230 Boeing 737s over several years, a deal with a catalog price of $22.4 billion. Since taking to the skies in 2000 with a single leased plane, Lion Air has grabbed 51% of Indonesia’s domestic air travel. Its 71-plane fleet, plus smaller turboprop planes operated by a subsidiary, Wings Air, will allow it to add new routes and services to a domestic market that soared by 18% last year to 51.5 million passengers, a figure that analysts say could double within five years.

Yet 49-year-old Rusdi and his elder brother, Kusnan, co-owners of Lion Air, remain something of an enigma, even in the airline industry. They’ve shunned outside investors, relying instead on aircraft financing and retained earnings. Their blockbuster order for new aircraft may soon tip their hand, if they can’t raise enough debt. Rusdi, president director, told a small pack of reporters at the Singapore Airshow that Lion could list in the next two years after shelving plans for an equity offering this year.

The tycoon rarely talks to the press and didn’t respond to interview requests from FORBES ASIA, which through 2010 had the brothers on the Indonesia rich list at an estimated $580 million. Lion Air’s finances—and its operating profits—are a closely guarded secret, as the elusive Rusdi acknowledged to reporters in Singapore. “We don’t like to show people a lot; we just want to work,” he told them. “You can call my bankers. They won’t finance a company that isn’t very good.”

Also keeping a close eye: AirAsia, the Malaysian carrier that pioneered low-cost air travel in Southeast Asia. Until now Lion Air’s primary focus has been domestic. Only 6% of its capacity is on intra-Asian routes, and it has backtracked on plans for adding flights to Australia. But its expansion over the next decade is partly aimed at regional routes from Indonesia. That puts it squarely in the path of AirAsia, which carried 30 million passengers in 2011.

For now, Tony Fernandes, founder and CEO of AirAsia, says he isn’t losing sleep over Lion Air as a competitor. He argues there is room in Southeast Asia’s expanding air-travel market for both to grow and prosper, just as Europe accommodates Ryanair and Easyjet, as well as dozens of smaller low-cost and boutique airlines. “This is not a one-airline show,” he says.

According to Boeing’s current forecast, Southeast Asia will need 2,750 jet aircraft between 2011–30, at a combined list price of $410 billion. Most will be single-aisle planes like the Boeing 737 that are the workhorses of budget carriers like Lion Air. (It ordered 29 more of what it has.)

Crucially for manufacturers, says Ralph Boyce, president of Boeing Southeast Asia, most airlines in Asia will be adding aircraft, not just upgrading an existing fleet. “We think that in Asia the percentage of new planes will be 80%,” he says. The rapid growth of air travel in countries like Indonesia is swelling passenger numbers, while deregulation spurs more competition among carriers.

While Lion Air’s latest order drew global plaudits (Barack Obama attended a presigning ceremony held in Bali last November), the airline already has a backlog of orders for Boeing aircraft. “Planes are arriving practically every month,” says Boyce, an ex-U.S. envoy to Jakarta.

So where is the money coming from? While the Export-Import Bank of the United States provides credit for such Boeing customers, Lion Air will still need to tap commercial lenders for the bulk of the purchase price (typically a hefty discount to the list price). Boyce says he’s got no doubt that its owners will be able to finance their fleet expansion. “Rusdi Kirana has proven that he can run an airline efficiently. He’s making profits. People like to lend money to that kind of operator,” he tells us.

Aircraft manufacturers and leasing firms probably have a better idea of what’s under the hood at Lion Air than the rest of the industry, says Brendan Sobie, an analyst in Singapore for Sydney aviation consultancy Centre for Asia Pacific Aviation (CAPA). As a private company Lion Air isn’t required to disclose financial and operational data that would reveal how efficiently it runs its fleet, such as costs per available seat kilometer. “We don’t have any real idea of how much the profits are,” says Sobie. “We only know what [Rusdi] says.”

Lion Air’s secretive boss is a far cry from Fernandes, the ubiquitous AirAsia tycoon who is his own brand (and a past FORBES ASIA Businessman of the Year). Rarely seen without his red baseball cap, Fernandes is a fixture in the Malaysian press and on Twitter, where he has 170,000 ­followers. Two days after AirAsia Bhd, the parent company, reported a 47% drop in full-year net profit to $187 million. Fernandes returned our call while in transit.

Like all carriers, AirAsia was hit by high fuel prices last year. But overall group revenues grew to $1.5 billion, while its nonfuel costs fell 13% year-on-year. Strip out deferred tax and foreign exchange impairments to profits and it was “a stellar year,” insists Fernandes.

A major drag on earnings was Indonesia, where operating profit fell sharply to $16.5 million, compared with

$65 million at AirAsia Thailand. Both airlines are joint ventures, a model that AirAsia has used successfully to get around restrictions on foreign ownership. In its earnings report the company said it would list AirAsia Thailand and Indonesia this year (a similar claim was made last year).

Fernandes blames the poor performance in Indonesia on aging, fuel-guzzling planes, which he has phased out in order to cut costs in a market where he sees huge potential. “We now have an all-new Airbus fleet. I see Indonesia as the jewel in our crown,” he avers.

That puts AirAsia in good company. Aside from Lion Air, national airline Garuda is adding capacity on flights operated by its budget Citilink unit. Garuda also notched 40% growth last year in passengers on its full-service routes, according to CAPA. Meanwhile, Lion Air plans to launch its own full-service carrier, Space Jet, next year, joining startup Pacific Royale, which will target affluent passengers with point-to-point routes that bypass Jakarta.

Old brands are also being revived. Mandala Airlines, which suspended operations in early 2011, is due to relaunch in April using Airbus A320s provided by Singapore-based Tiger Airways, its new shareholder. Under a debt restructuring, the main principal is now Saratoga Group, an investment firm founded by rich listers Sandiaga Uno and Edwin Soeryadjaya.

“Indonesia is a very fragmented market because of its geography. But just a few carriers have most of the market share,” says CAPA analyst Sobie, who puts the number of jet operators at 16. Some have dubious safety records and regulators have struggled to keep up with the industry’s expansion. Lion Air has faced criticism over its supervision of pilots after three were busted recently for drug use.

Asked about the challenge from Lion Air, Fernandes seems all smiles. “They’re a good airline, and they operate well. I see them as a good competitor.” he says. When their Boeing deal was trumpeted in Singapore, he tweeted: “Congrats to Lion Air for their huge aircraft order. I have huge respect for entrepreneurs who build airlines from nothing … Well done, Rusdi.” This from a guy who loves to spar publicly with other airlines and poke fun at his critics.

But the gloves may soon come off, says Shukor Yusof, an aviation analyst at Standard & Poor’s in Singapore. He describes Rusdi, who divides his time between Singapore and Jakarta, as “obsessed” with eclipsing Fernandes and his airline. “That really drives him. He wants to be bigger than AirAsia in terms of profits, fleet and routes. That’s the single motivating factor,” he says.

That explains why Lion Air signed up for 201 of Boeing’s 737 Max. In 2011 ­AirAsia was the toast of the Paris Air Show with its record-breaking order for 200 Airbus A320 Neos. Rusdi wanted to go one better. The dogfight is on.

Look Who’s Cheapest

Costs on selected Southeast Asian budget airlines, in cents per available seat kilometer (ASK), most recent available

FORBES.COM

“Tiger Airways Holdings Limited is pleased to announce that PT Mandala Airlines’ Air Operator’s Certificate has been reactivated by the Indonesian director general of Air Communications,” the Singapore budget carrier said.

“Information regarding the number of aircraft, the initial routes and destinations for Mandala will be announced soon. The resumption of flights is scheduled for April 2012.”

Mandala Airlines’ clearance to fly culminated a year of financial restructuring after the carrier was grounded in January 2011 due to its enormous debt.

As a result of the restructuring, Indonesian investment company Saratoga Group holds a majority 51.3 percent stake, with Singapore budget carrier Tiger Airways owning 33.0 percent through wholly-owned subsidiary Roar Aviation Pte Ltd

The remaining 15.7 percent stake will be held by Mandala’s previous shareholders and creditors.

Mandala Airlines – which was owned by the Indonesian military until 2006 when private investors took over – will adopt Tiger Airways’ low-cost carrier model and will use Airbus A320 aircraft in its fleet.

It aims to fly within Indonesia and to international destinations within a five-hour flying radius.

http://sg.news.yahoo.com/indonesias-mandala-airlines-cleared-fly-again-055031956.html

“We are studying two options — Gadingsari, Sanden in Bantul regency and Temon in Kuloprogo regency. [The relocation] is urgent and we’ll make sure we find the new place this year,” House of Representatives’ infrastructure commission lawmaker Gandung Pardiman said in Bantul, Yogyakarta, on Saturday.

Gandung said that the relocation was necessary because it was almost impossible to expand the airport, which accommodates civil and military flights.

“The airport is surrounded by densely populated residential areas. That would make expanding the airport difficult,” Gandung said.

He said that the number of passengers at the airport would increase by 10 percent every year. The airport received 3,488,500 domestic passengers and 206,500 foreign passengers in 2010.

Gandung said that many investors had expressed interest in investing in the new airport.

Bantul secretary Riyantono welcomed the plan, saying that Bantul had the capacity to accommodate the new airport.

“However, we are still waiting for the results of the study to determine whether or not Bantul is a feasible location for the new airport,” Riyantono said. (swd)

The sub-Cayenne Macan will be available for the customer who doesn’t want a full size SUV, but still wants the luxury of a Porsche. In the Concept sketch we can see that the Macan will sport a low profile roofline but keep the general look of the Cayenne.

The word Macan is Indonesian for Tiger, and was chosen because, “The name of a new Porsche has to fit with the brand, sound good in very many languages and dialects and evoke positive associations,” says Bernhard Maier, Member of the Executive Board Sales and Marketing of Porsche AG.

The Macan will begin production in 2013 in Leipzig, Germany.

Watch the teaser video .

From : http://www.autoguide.com/auto-news/2012/02/porsche-names-newest-suv-macan.html

Its fierce rival Lion Air confirmed its order for the Boeing 737 Max 9 and additional ATR 72-600 turboprops. Finally, Pacific Royale, a full-service start-up, said it would begin operations in March with two Airbus A320s and two Fokker 50s.

It will join Lion Air’s subsidiary Space Jet, which will offer full-service operations from 2013, and Sriwijaya which is retrofitting its aircraft to include business class seats in the full-service market. In the low-fare segment, Mandala Air will soon resume operations after Tiger Airways’ plan to take a stake in the airline went through. Indonesia AirAsia continues to grow as it eyes an IPO this year, while Merpati is looking to rejuvenate its fleet. All of them are eyeing a share of the growing pie. IATA has forecast international passenger numbers to Indonesia could grow by 9.3% a year from 2010 to 2014, when it is expected to reach 22.7 million. Domestic numbers are expected to grow by 8.7% annually to 38.9 million passengers by 2014.

This is on the back of an expected annual GDP growth of 6.5% until 2015, in a country that is also a large archipelago with 33 provinces and almost 240 million people. The geography lends itself to a market that requires several international and domestic air hubs, and numerous services to the tier one and two cities where there are no direct connections.

There is an urgent need to improve the infrastructure, especially at the capital Jakarta, where the main Soekarno-Hatta airport handled43.7 million passengers in 2010 despite having capacity for only 38 million. That has not stopped the airlines.

Garuda has announced plans to more than double its fleet to as many as 194 aircraft by 2015. These include 18 CRJ1000s, of which six will be purchased directly from Bombardier and 12 procured from leasing company Nordic Aviation. It also has options for another 18 of the type. The aircraft, which will be in a two-class configuration, will be based in tier two Indonesian cities such as Makassar, Medan and Balikpapan and used on both international and domestic routes. The flag carrier is using subsidiary Citilink to take on Lion Air in the low-cost segment. It signed a contract with RBS Aviation Capital for the lease of four new A320s for Citilink, and has a backlog of 25 A320s due for delivery between 2014 and 2018.

“With this expanded fleet, Citilink will become a major airline in Indonesia. Garuda will then focus on full service customers, while Citilink will focus on budget travellers,” says Garuda chief executive Emirsyah Satar.

Lion Air, however, continues to grow. It signed a firm order for 201 737 Max aircraft at the show for delivery from 2017, becoming the launch customer for the -9 variant. It also ordered an additional 29 737-900ERs in a combined deal for 230 aircraft worth $22.4 billion.

Purchase rights have also been secured for an additional 150 aircraft. It also inked an order for 27 ATR 72-600s, in a deal worth $610 million, for regional subsidiary Wings Air.

This order will make it the largest ATR operator worldwide, with a fleet of 60 turboprops when all the aircraft are delivered by 2015. Wings Air will use them to develop new routes departing mainly from Sumatra, Kalimantan, Sulawesi and the Papua islands.

Lion Air, however, is also keeping one eye on Garuda’s full service market segment with its Space Jet plan. These will initially begin with 737-900ERs it has on order in 2013, on both domestic and regional routes, and later include either Airbus A330s or Boeing 787s.

“Right now, if I want to go to Tokyo [I will] have to go from Singapore or Jakarta. This will take the same time as from Manado, and the government is also keen to make this city the gateway to Asia-Pacific,” says chief executive Rusdi Kirana.

Rusdi dismisses concerns about overcapacity in Indonesia because of the fleet expansion plans of Garuda Indonesia and Lion Air. He believes the Indonesian market has room to operate up to 1,000 aircraft.

“If you look at how many people there are in America, Malaysia, Singapore and Indonesia and compare the ASK, we have 230 million people but our ASK is much, much lower than Singapore’s,” says Rusdi. “We have the chance to grow, and we will continue to do so.”

from:

An expanding middle class, strong economic growth, political stability and the need to link the resource-rich islands are fuelling a travel boom that could spawn even more local airlines, industry executives and analysts say.

Budget carrier Lion Air grabbed the limelight at the beginning of the trade fair on Tuesday when it formally sealed a $22.4 billion deal for 230 aircraft with US aircraft maker Boeing.

Lion Air ordered 201 Boeing 737 MAX and 29 next-generation 737-900ERs, with purchase rights for an additional 150 planes for its domestic and regional operations.

Dinesh Keskar, vice president of Asia Pacific and India for sales at Boeing Commercial Airplanes, described the deal as “the largest order in the history of aviation that I can know of”.

With some 240 million people, Indonesia has the world’s fourth largest population and is the most far-flung archipelago with over 17,000 islands scattered across 33 provinces and three time zones between Singapore and Australia.

Indonesia’s economy grew 6.5 per cent last year, the fastest pace in 15 years, with growth projected at between 6.3 and 6.7 per cent this year.—AFP