Aviation SOEs: State-owned airlines to consolidate soon

This article has been translated by PwC Indonesia as part of our Indonesia Infrastructure News Service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content.

Bisnis Indonesia - Aviasi pelat merah: Maskapai BUMN segera konsolidasi

3 January 2025

By Artha Adventy

Bisnis, Jakarta – The State-owned Enterprises Ministry aims to complete the airline consolidation roadmap within the next six months. This initiative is part of an effort to bolster the national aviation industry, currently facing an aircraft shortage.

State-owned Enterprises Minister Erick Thohir announced that the consolidation of PT Garuda Indonesia Tbk (GIAA), PT Pelita Air Service, and PT Citilink Indonesia is included in a roadmap scheduled for completion in six months.

Erick Thohir mentioned that the state-owned enterprise (SOE) airline consolidation is being undertaken with consideration of the restructuring synergies and the ecosystem of the aviation industry.

"The consolidation roadmap will be executed over the next six months. Yes, it will be completed in six months," Erick stated at the SOE Ministry on Thursday (2/1).

Erick Thohir expressed a desire to make SOEs more efficient. He added that the SOE Ministry is currently determining which SOE will merge first. According to Erick, further study is needed regarding the merger concept.

Erick also addressed the global trend of aircraft accidents. He stated that there is no negative bias towards specific aircraft manufacturers when procuring aircraft.

This comment responds to several incidents involving the US aircraft manufacturer, Boeing. He noted that each aircraft has its own specifications and uses.

"We are not prejudiced against a particular brand, but we are focusing on reducing the variety of aircraft types," he said.

He further explained that reducing the types of aircraft allows for more efficient maintenance.

"If an airline operates too many different types of aircraft, maintenance becomes inefficient. This is what we are improving. Each airline must enhance the efficiency of their maintenance and services," he added.

Meanwhile, Garuda Indonesia (GIAA) Commerce Director Ade R Susardi confirmed that of the 50 Boeing units owned by GIAA, 40 are Boeing 737-800s. 

However, he assured that Garuda Indonesia consistently performs routine maintenance on each aircraft to ensure flight safety.

Moreover, following the Jeju Air incident, Boeing, as the manufacturer, has instructed all airlines to inspect their aircraft.

"Usually, after an incident, the manufacturer will instruct all users to conduct checks. They typically follow the instruction," Ade remarked.

Furthermore, the SOE Minister stated that consolidating state-owned airlines will strengthen the national aviation industry, which currently lacks aircraft. 

According to his records, at least 750 aircraft are required to service all routes in Indonesia. Presently, only 400 aircraft are in operation, prompting SOE airlines to increase their fleet this year.

Additional aircraft

Pertamina Group airline, PT Pelita Air Service (PAS), announced that it will acquire six new aircraft by 2025. 

Pelita Air Service President Director Dendy Kurniawan stated that PAS is awaiting the arrival of six Airbus aircraft scheduled for this year.

"This year is certain; we are no longer in the planning stage. We just need to wait for six more aircraft to arrive," he explained.

Dendy elaborated that these new aircraft are wide-body models, intended to support GIAA's hajj and umrah flights. 

Currently, Pelita Air operates 12 aircraft, with six more due by the end of the year, bringing the total to 18.

Previously, Pelita Air received a new Airbus A320-200, which began operations at the end of last year. According to official information, Pelita Air received the aircraft with registration number PK-PWM, marking the twelfth aircraft in their fleet.

Meanwhile, PT Garuda Indonesia Tbk (GIAA) President Director Wamildan Tsani Panjaitan stated that the company is exploring the possibility of using aircraft from the Chinese manufacturer, Commercial Aircraft Corp of China Ltd (Comac). 

Wamildan noted that communication with Comac has been established regarding this opportunity. However, he indicated that there is still a lengthy process before these aircraft can be operational.

"I cannot provide a definitive answer, but communication has been established. However, there is still a long process before the aircraft can be operational," he explained.

Additionally, GIAA plans to add at least 20 new aircraft by 2025. In January, GIAA expects to receive two Boeing aircraft, with one scheduled to enter service in February.

Meanwhile, GIAA subsidiary PT Citilink Indonesia has opted to restore its existing fleet and establish routes to eastern Indonesia rather than acquiring new aircraft in 2025. 

Citilink Indonesia President Director Dewa Kadek Rai stated that this year, Citilink will not expand its fleet. Instead, the company will focus on restoring 19 unserviceable aircraft.

"We are concentrating on restoring our aircraft that are currently unserviceable. Our grounded aircraft requiring maintenance currently reach 19," he explained.

Citilink currently operates 56 aircraft, comprising 49 Airbus 320s and 7 ATR 72s. He expressed hope that these aircraft will remain in operation until the end of the year. 

Additionally, Citilink plans to increase flight frequency and establish new routes throughout 2025. Flight frequency will be boosted on several existing routes, and new routes will be established, particularly to eastern Indonesia.

"There are several additional routes, especially to eastern Indonesia. The frequency is yet to be determined," he explained.

During the 2024/2025 Christmas and New Year period, Kadek reported that the load factor reached 81%. Kadek claimed that Citilink experiences a surge in passengers each year. 

Citilink, part of the Garuda Indonesia Group, prepared 210 extra flights during the 2024/2025 Christmas and New Year period.

Kadek stated that his company arranged 11 extra flights per day during this period. 

"We provided 210 extra flights, equating to 11 flights per day," Kadek said.

Kadek further explained that, in addition to the extra flights, his company also offered additional seats during the 2024/2025 Christmas and New Year period, adding around 2,000 passenger seats.

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