Garuda makes a quantum leap

As far as ‘come-back’ stories go, Garuda Indonesia has a remarkable one to tell. The 65-year old carrier’s transformation has been one of the most impressive success stories in Asia Pacific aviation. Backed by the largest economy in Southeast Asia and with steady progress on its restructuring programme, the carrier has been growing its fleet, network and is set to return to Europe and has even won a string of awards, including Payload Asia’s Rising Star Carrier of the Year 2013. By Donald Urquhart.

Garuda makes a quantum leap

It would have seemed inconceivable, even five years ago, to think that Garuda would ever overcome all the hurdles lined up in front of it. Black listed from European airspace with an ageing fleet of aircraft, chequered safety record, a mountain of debt and counterproductive state interference all made the future appear very bleak for the once proud carrier.

But all that is water under the bridge a mere four and half years after the lifting of the EU ban against Garuda Indonesia and three other Indonesian carriers. Shortly after emerging from the shadow of the EU ban, the airline announced in July 2009 an aggressive five-year restructuring plan known as the ‘Quantum Leap’.

Among other things,the plan involved an image overhaul including branding, a doubling of its fleet to 116 aircraft over the five year period and corresponding plans to grow annual passenger numbers nearly three fold through increasing domestic and international destinations, including a return to Europe. The carrier also shed its state-ownership model, making its debut on the Jakarta Stock Exchange in February 2011 with the government retaining a 70 per cent share.

The process, as Rajendra Kartawiria vice president of SBU (Strategic Business Unit) Garuda Cargo notes, was step-bystep, based on the revenue side and the service side. The first priority was to get the domestic passenger business in order, followed by the international business, its low cost carrier Citilink and then cargo. With the first three taken care of, attention turned to the cargo business last year.