Kartiko Wirjoatmodjo, deputy minister of state-owned enterprises said that the debt negotiations and restructuring were underway with all lenders, aircraft lessors, and global Sukuk (syariah bond) holders.

He said, “Should the restructuring fail, we have no other option but to close it and find a new (national flag carrier) as it is impossible for (the government) to inject capital with such debt value.”

Garuda Indonesia’s ill fate has been well documented over the years. Inadequate management and losses incurred over the years were dragging the carrier down and the Covid-19 pandemic pushed it towards bankruptcy.

Currently, the carrier faces its worst crisis since its formation in 1947. As per Garuda Indonesia’s financial report, the carrier earned around $56 million, while the aircraft rental was about $56 million, aircraft maintenance cost around $20 million; fuel cost around $20 million; and salaries $20 million. It has accumulated a debt of around $4.9 billion.

While some members of the government do believe that the carrier can be saved. Indonesian House of Representatives member Herman Khaeron said that if the situation returns to normal following the pandemic, then Garuda will be able to improve its performance and cover its liabilities.

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Currently, Super Air Jet now has three Airbus A320-200s in the fleet. Previously, Super Air Jet president director Ari Azhari revealed that the budget carrier will initially target western
Indonesia with at least daily return services.

He told the local media, “The main aim of Super Air Jet is to offer a low-cost concept with direct flights between cities on a point-to-point basis in the domestic market and later on, expand into international routes.”

The first six cities that Super Air Jet plans to operate in are Jakarta Soekarno-Hatta, Palembang, Padang, Batam, Medan Kuala Namu, and Pontianak.

Recently, it was also reported that another Southeast Asia-based carrier Air Premia is set to begin its operations this week. Similar to Super Air Jet, the startup will focus on domestic flights, however, plans to expand internationally in 2022.

It is being reported that On August 11th, the airline’s Boeing 787-9 Dreamliner, registration HL8387, will fly route YP541 from Seoul’s Gimpo International Airport to the island of Jeju. The carrier will operate this route twice a day.

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