What surprised me even more was almost all the passengers were Australian. I became a minority in my own flagship airline. During that flight, for the first time I experienced the excellent service made by Garuda.

All the crew was sympathetic and stood ready to help passengers with any need such as a can of Coca Cola or, many passengers did ask for cans of Bintang beer.  

The ambiance was really joyous with many passengers acting as if the flight was a party. Each with a can of Bintang in their hands. I noticed those passengers were already like a community.

I flew with Garuda again from Sydney to Denpasar a few months later. On that trip I found the ground crew was very helpful and in fact relieved me from the burden of excess baggage, which eased my headache. I still found the service excellent.  

Garuda was able to maintain consistency in providing an excellent service during its flights. I noticed that the maintenance of service became standard for Garuda. I enjoyed riding the first Boeing 737-800 on my flight to Surabaya and was served with luxury with a blanket once the cabin became cold. (In those days I hardly ever saw blankets provided for domestic flights).

Later, I enjoyed the personal video service on the flight to Singapore using the same aircraft. In fact, I felt rich on that flight since everything was served perfectly, even in economy class.

Since then, I monitored this airline very closely and most of the time compared with what they do with rival airlines. One of the interesting comparisons were my flights to London and Tokyo.

I flew to London on a first-class ticket with Malaysian Airlines and flew to Tokyo from Jakarta with Garuda business class.  

To London I paid a Malaysian Airlines US$6,000 roundtrip while to Tokyo I paid Garuda less than $2,000 for the business-class ticket return.

I chose Malaysian Airlines to London because its price was much lower than Singapore Airlines, which charged people $15,000 on Airbus 380 or $12,000 on a regular flight. Both are for the first-class tickets.  

My experience with Malaysian Airlines, which flew a quite old Boeing 747-400 was not too extraordinary. Very rare the cabin attendants visited me and looked after my needs.

Therefore, I had to ring a bell many times to call them. In fact, I also had to ask  for a bottle of mineral water during that flight.  

On the other hand, the service of Garuda was much more extraordinary. On that route, Garuda flies the new Airbus 330-200 with flat bed seats for business class. What is more exciting is that the crew knew what I needed.

Even when I woke up from dozing off I found not one but two bottles of mineral water by my seat. They served a delicious breakfast before arriving.

The crew went around regularly to attend the needs of the customers. All in all, the service that I experienced with Garuda was really memorable.

I wrote of this experience in a story with the title “To Tokyo with the best Airline in Asia”. This is so because from the survey in 2010 by Australian-based Center of the Asia Pacific Aviation (CAPA), Garuda scored the best, in fact better than even Singapore Airlines in all aspects of the survey.

All these excellent experiences show a premium quality of the service of the airline. However, the basic feature of the company was improved much earlier. The timeliness of the flights have become a norm these days. Even a delay of 15 minutes triggers a request of an apology from the pilots.  

Meanwhile the rejuvenation of the fleet has been moving quite far. Nowadays, the age of Garuda’s aircraft has become much younger, no less than even Singapore Airlines. With the arrival of new Boeing 737-800s, Airbus 330-200s and even Boeing 777 ERs, Garuda will continue to maintain increasingly younger fleet. Therefore it can be expected that the safety culture of the airlines will similarly ingrain in the mind of the employees.

With all these characteristics being built, Garuda has firmly established itself not just as a full serviced airlines but as a premium airlines. I am sure that the strategy works well, especially at the time when the size of the Indonesian middle class is growing at a rapid rate.

According to the Asian Development Bank, the number constituting the Indonesian middle class (measured with the income of between $2 to $20 per day) has reached 106 million people.

At the same time, the number of affluent people has reached more than 30 million people, larger than the entire Malaysian population. With the right targeting, Garuda will enjoy most of the benefits of the larger middle-class and affluent population.

Currently we have seen the beginning of the “harvest season”. The business lounge of Garuda grows larger and larger to accomodate more business class passengers. The queue at the check-in counter also keeps growing and is a testimony of how successful the airline is.

It is no wonder that the management has the courage to forecast a much brighter outlook several years down the road with the number of passengers increasing. I would not be surprised if the number of passengers double in less than five years’ time.

With all these experiences, I feel excited with the prospect of Garuda going public. The preparation that the management has made in the last few years will certainly pay off on this IPO.

In terms of timing, from the internal point of view, Garuda has just received a title of the most improved airline from Skytrax. At the same time, as mentioned earlier, CAPA nominated Garuda as the best airline in Asia.

All these achievements will at the end enhance the visibility of the airline in the eyes of global investors.

Financially, Garuda has made a miracoulous turn-around. From a money-losing business, in the last three years Garuda has booked increasing profits year after year.

In fact, the legacy of debt form the previous management has been gradually brought down. From more than $800 million a few years back, now Garuda’s indebtedness to ECA is just $240 million. With this IPO, the ratio of debt to equity will decline so that the capital structure of the airlines will be improved significantly.  

The IPO will also bring transparency to the airline so that the conduct of corporate governance will experience much improvement. The current management has shown an exemplary performance so that with the IPO the culture of good corporate governance will cascade down to all levels of management. With that we can expect further improvement in its efficiency.

Meanwhile, the capital market has been condusive to an IPO. Even though last week there was a major correction in the stock market, fundamentally the market continues to be bullish.

Global investors are hungry for prospective investments. And Garuda is certainly not the kind of company that they will miss.  

With that kind of environment we expect that the government and the management will allow the IPO to proceed smoothly. With that, the Indonesian stock market will acquire one more blue chip company in their exchange.



With all these characteristics being built, Garuda has firmly established itself not just as a full serviced airlines but as a premium airlines.


The writer is an economist.

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