Wednesday, February 19, 2014

Susi Air to Spend Up to $50m for 10 Additional Aircraft

Jakarta. ASI Pudjiastuti Aviation, an Indonesian airline operator that runs Susi Air, plans to add 10 aircraft to its fleet this year, with aims of expanding its reach.

Total combined cost is estimated to reach as much as $50 million, said Susi Pudjiastuti, chief executive and owner of the airline operator, on Wednesday.

The additional aircraft will expand the schedule and charter airline’s fleet to 59 airplanes.

“I want to make citizens of our archipelago feel as if they live in one continent, instead of thousands of scattered islands. I want to show them it’s easy to travel using our service,” said Susi.

Susi Air, based in Pangandaran, West Java, is one of the world’s biggest users of Cessna 208 Caravan aircraft, in the chartered and commuter service category.

She added that the purchase will be financed by loans, not through leasing.

“For airlines who operate with small aircraft, it is better to use bank loans. The option of leasing is a very expensive one,” she explained.

Founded in 2004 with two Cessna Grand Caravans, the company has managed to find a niche market by flying to remote regions that are not serviced by larger commercial airlines. Some routes are booked on a charter basis.

Susi Air now serves a total of 195 routes and 165 destinations throughout Indonesia, from the most western part of Aceh province to the most eastern part of Merauke in Papua. The airline offers scheduled commercial flights, block seat flights and scheduled chartered flights. It also offers spot charter flights and long term charter flights.

Of its 195 domestic routes, 177 — or 91 percent — are unique to Susi Air.

Last year, it booked $40 million in revenue and in 2014, Susi hopes to see a 20 percent increase, thanks to steady demand from its customers.

“The biggest challenge is now the rupiah depreciation. It contributes to around 70 to 80 percent to our total spending, for spare parts, maintenance and pilot costs,” explained Susi.

Still, she is confident her business will continue to see growth, along with the government’s efforts to open more remote areas and build more airports that can accommodate smaller airlines.

When asked whether she may be interested to takeover routes leftover by Merpati Airlines, an ailing state-owned carrier that has suspended all flights in early February, she said: “If it looks good, we’ll take it [the routes]. But I don’t know, it all depends on the government.”

Susi was previously a lobster entrepreneur who unintentionally fell into the airline business.

Susi Air’s corporate clients include coal miners Adaro Indonesia and Indika Energy, diversified conglomerate Bosowa Corporation, cement maker Holcim Indonesia, as well as global cable news network CNN.


No comments:

Post a Comment