Business

Lion Air set to buy Hawker
jets for private services

Low-cost carrier Lion Air is purchasing four Hawker 900 XP aircraft to support its launch of private-jet services in Indonesia, a company executive says.

The privately-owned airline’s general affairs director, Edward Sirait, said that the company would pay US$70 million for the nine-seater jets.

“We are going to purchase the aircraft during the Singapore Air Show next week and the first two Hawkers will arrive in May,” he said.

Based on the company’s business plan, private jet services will be launched in the third quarter of 2012.

The Hawker jets will become available to individuals, but it is most likely that they will be used to serve clients from the private sector, particularly those in the country’s mining industry, he said.

“We find that the demand is there. Most of the CEOs of mining companies are living in Jakarta, but they have to travel from one island to another to visit the mine sites,” he said.

He said that the penetration of Lion Air into the chartered-plane market would strengthen its position in the country’s airline industry as well, seeing it become a competitor to several other charter-plane companies, such as Susi Air and Jet Royal.

The airline has been in negotiations with US-based Hawker Beechcraft since last year.

Transportation Ministry’s air transportation director general Herry Bhakti Gumay said that the airline was currently processing an Air Operator Certificate (AOC).

“We are still studying the document from Lion Air, that is intending to expand their business into the private jet sector,” Herry said.

He said that the company did not have to obtain a new flight permit (SIUP) as it was only adding new type of service.

Concerns have been raised over Indonesia’s largest budget airline’s aviation safety after pilots and crew were arrested for allegedly using drugs.

The latest case involved a pilot, who has worked for the airline for seven years and was claimed to be one of its best pilots, arrested in Surabaya, East Java, for allegedly possessing 0.04 grams of crystal meth.

Despite the drug abuse allegations, the airline signed a record contract, worth $21 billion, for 230 Boeing 737s from the US manufacturer last November.

Lion Air plans an initial public offering next year to raise more than $1 billion through the sale of a 20 to 30 percent stake in the company to help finance its rapid expansion.

It aims to fly to China, India, South Korea, Japan and Australia.

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