Business

Cancellations cost us Rp
2.25 billion: Garuda

State airline Garuda Indonesia has estimated it suffered Rp 250 million (US$28,000) in losses and another Rp 2 billion in opportunity losses from canceling scores of flights recently due to a technical glitch, a senior executive says.

“It’s an estimate. There might be opportunity losses of Rp 1.5 billion-Rp 2 billion and actual losses of about Rp 250 million on lodging expenses we spent on passengers whose flights were canceled,”  Garuda chief financial officer Elisa Lumbantoruan said Friday.

Elsa said that over the four days that the technical glitch persisted, Garuda canceled 26 flights, and that with an estimated average of 140 passengers per flight, “we might have suffered about Rp 1.5-Rp 2 billion in opportunity losses”.

Flights that were canceled from last Sunday to Wednesday included flights to Medan, Batam, Pangkal Pinang and Padang.

The problems started when Garuda upgraded to a new IT system on Sunday.

Garuda said it spent US$1.5 million to upgrade to the new IT system, which managed the flow of flights, cabin crew and passengers. (est)

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