Having offered charter services in the past few years, Pelita Air is now entering the scheduled flights business with the aim of adding 10 new planes annually over the next five years, starting in 2023.

By the end of this year, the airline is set to operate a total of eight aircraft, up from the first two aircraft it bought in April for its scheduled flights segment.

Around 80 new pilots and 160 crew members are to be recruited every year to man the increasing fleet

“We cannot say much yet about gaining market share. Our smallest competitors [for domestic travel], like AirAsia, have at least 25 planes, while we [will have] just a third of that [at the end of the year],” Pelita Air CEO Dendy Kurniawan told the media on Wednesday.

Read also: Pelita Air diversifies into scheduled flights

Dendy explained that the airline would lease rather than purchase aircraft for its expansion and that it would only operate one type of aircraft, the Airbus A320, which was similar to AirAsia's strategy to minimize costs.

This fleet expansion, Dendy said, would enable the airline to offer new routes from Jakarta to Surabaya, Balikpapan and other major cities in Indonesia, in addition to currently Bali and Yogyakarta.

“Why Balikpapan? Because there will be a new capital city,” Dendy said.

An adequate fleet was also necessary to quickly catch up with competitors, Dendy said, adding that Pelita Air aimed to match the flight frequency of existing players.

Profitability in 2023

Pelita Air’s plans come as the airline industry has begun to recover from the blow of the pandemic, but surging fuel costs and economic uncertainty pose new challenges.

Indonesia’s airline industry offered significant potential, Dendy said, noting the country’s archipelagic landscape and increasing air travel demand from a growing population.

Moreover, the airline would focus on medium-service flights, allowing it to enter the market without directly competing with national flag carrier Garuda Indonesia, which operates in the full-service segment, or Garuda’s subsidiary Citilink, which is in the low-cost carrier (LCC) segment.

According to the Transportation Ministry, a full-service airline must provide some alternatives in the menu offered on board, whereas a medium-service airline was only obliged to provide one item, while an LCC did not have to serve any.

Dendy said the airline’s marketing would target millennials, arguing that many Indonesians in that age bracket had sufficient income to afford frequent air travel.

“We have a target, God willing, we can start making a profit next year, albeit with a very thin margin. In our calculation, that will be achievable,” Dendy said, adding that the carrier aimed for a 70 percent load factor by the end of this year, whereas in its early days it was less than 50 percent

The airline has imposed a surcharge on airfares to cope with surging fuel prices.

Read also: Creditors approve Garuda's restructuring plan

Garuda and Merpati

Pelita Air is set to acquire maintenance, repair and operation (MRO) facilities from bankrupt state-owned airline Merpati, according to the State-Owned Enterprises (SOEs) Ministry.

Dendy said the new facilities should be consolidated with both Garuda and Pelita’s MRO subsidiary GMF AeroAsia and PT Indopelita Aircraft Services, arguing that each facility could be assigned to servicing different plane types.