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Airline industry reaches saturation point

Indonesia’s airline industry is thought to be reaching its saturation point because an increase in seat capacity does not seem to be supported by an increase in airport capacity and improvements in infrastructure, according to an industry group

Nadya Natahadibrata (The Jakarta Post)
Jakarta
Thu, February 5, 2015 Published on Feb. 5, 2015 Published on 2015-02-05T08:24:53+07:00

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I

ndonesia'€™s airline industry is thought to be reaching its saturation point because an increase in seat capacity does not seem to be supported by an increase in airport capacity and improvements in infrastructure, according to an industry group.

A lack of infrastructural development, particularly for airports, has prevented airlines from increasing the number of passengers on their flights, said Indonesia National Air Carriers Association (INACA) chairman for the scheduled airline division Bayu Sutanto.

The growth of airline passengers traveling overseas last year slowed to 5.41 percent (13.7 million passengers) from 9.47 percent in 2013 (13 million), data from the Central Statistics Agency (BPS) showed.

The highest increase in the number of outgoing airline passengers was recorded at Kualanamu International Airport in Deli Serdang, North Sumatra with a 37.3 percent increase, followed by Soekarno-Hatta International Airport (34.68 percent) and Sultan Hasanuddin International Airport in Makassar, South Sulawesi (24.14 percent).

'€œThe data from the BPS showed that the airline industry has reached saturation, because the increase in seat capacity was not supported by an increase in airport capacity and an improvement in infrastructure,'€ Bayu told The Jakarta Post on Tuesday.

'€œThe lack of infrastructural development did not only affect Soekarno-Hatta, but there are other airports across the archipelago similarly affected. The fact that not all airports are operating 24 hours a day also contributed to the slowed growth in the number of passengers,'€ he continued.

The weakening of the rupiah against the US dollar over the past year was another potential reason for the decreasing number of passengers traveling overseas.

Airnav president director Bambang Tjahjono said in a separate statement that the firm, in cooperation with state-owned airport operator PT Angkasa Pura II (AP II), had prepared the systems to increase the capacity of the existing runway in the country'€™s main airport from 72 flights per hour to 86 flights per hour.

Bambang said the plans to increase the capacity would become effective in June this year, in an attempt to ease plane traffic in the country'€™s main airport.

The BPS data, however, show that the number of domestic passengers in airports across the country increased by 5.81 percent last year to 58.9 million, compared with a 2.09 percent increase in 2013, during which the number of passengers reached 55.7 million.

The highest increase in domestic passengers '€” 13.09 percent '€” was recorded at Soekarno-Hatta airport in Tangerang, Banten. The second highest was recorded at Juanda International Airport in Surabaya, East Java, at 8.67 percent; third was Kualanamu airport at 3.98 percent.

The BPS also announced that the number of foreign tourist arrivals last year rose by 7.19 percent to 9.44 million, up from 8.8 million in 2013.

Tourism Ministry spokesperson Vincent Jemadu said this figure was in line with the government'€™s target of reaching 9.3-9.5 million foreign tourist arrivals, even though the percentage increase was lower if compared to growth between 2012 and 2013, when the country saw a 10 percent increase in tourists.

'€œThe growth is basically lower than it was in previous years because of slower economic growth in Japan and Europe,'€ Vincent said.

This year, the ministry hopes to attract around 10 million tourists.

Among the programs to increase the number tourists was a waiver of visa requirements for visitors from China, Japan, South Korea and Russia this year, according to Vincent.

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