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Garuda Indonesia urges ministry to revise up airfare price ceiling
The price ceiling has remained the same since 2019 despite there having been many changes in airlines’ costs.
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Soft landing: An airplane of national carrier Garuda Indonesia lands on Feb. 21, 2024, on a runway at Sultan Iskandar Muda International Airport in Blang Bintang, in Banda Aceh, Aceh. Garuda and Pertamina have successfully tested Bioavtur J2.4 sustainable aviation fuel for commercial flights. (AFP/Chaideer Mahyuddin)
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lag carrier Garuda Indonesia has urged the Transportation Ministry to revise the price ceiling on airfares, citing the need to stay afloat amid rising operational costs.
Garuda Indonesia CEO Irfan Setiaputra said on Wednesday that the price ceiling had remained the same since 2019 despite there having been many changes in airlines’ costs, such as fuel and aircraft leasing, which were largely experiencing an upward trend.
“Thirty percent of our costs are for aviation fuel. Moreover, 30 percent is for leasing. Twenty to 30 percent is for maintenance. Do you want to reduce the maintenance to 0 percent? Sure, we can [but we don’t want that to happen],” he said, as quoted from Tempo.
Irfan said he was aware that a hike in the price ceiling could lead to public outcry but he hoped the community would understand the challenges faced by airlines to stay afloat amid rising costs.
He added that keeping up with these expenses would allow them to keep fleets operational, warning that grounded aircraft could disrupt flight schedules.
“This is an expensive business with single-digit margins,” he said.
Read also: Govt rules out aviation fuel as cause of persistently high airfares
