Garuda benefits from going short-haul
JAKARTA – Garuda Indonesia has reported an 11-fold increase in net profits in 2008 as compared to 2007.
Net profits in 2008 for the Indonesian flag carrier totaled Rp. 669 billion (US$59.7 million) while in 2007 only Rp. 60 billion (US$5.4 million) in profits were booked.
In 2008 Garuda carried 10.1 million paying passengers, an increase of 9.8 percent over 2007 when 9.2 million passengers flew with the airline.
Quoted in Kompas, the airline’s CEO, Emirsyah Satar, analysed Garuda’s good fortune, saying: “in the current global financial crisis, airline passengers are decreasing more on long haul routes. Passenger loads on domestic and regional routes continue to grow.”
Satar also attributed his airlines profitability on fuel saving programmes, an increasingly younger fleet of aircraft, electronic procurement systems and other management efficiencies now being introduced.
An aviation analyst, Dudi Sudibyo, also credits Garuda’s surge in profitability to the sale of the corporate headquarter building in downtown Jakarta, suggesting that the vastly improved profitability is not completely due to operational issues and may not be sustainable over the long term.
Source: Bali Update (www.balidiscovery.com)
Ian Jarrett
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