Garuda Indonesia and Singapore Airlines (SIA) have signed an agreement under which the carriers will benefit from joint marketing and promotion, code sharing and special rate agreements
Garuda Indonesia and Singapore Airlines (SIA) have signed an agreement under which the carriers will benefit from joint marketing and promotion, code sharing and special rate agreements.
The memorandum of understanding was signed Friday in Jakarta by Garuda Indonesia president and chief executive officer Emirsyah Satar and SIA chief executive officer Chew Choon Seng.
"The industry has become more competitive and the increasing fuel price has put extra pressure on us, so we have to cooperate to increase efficiency and service (quality)," Emirsyah said in the press conference.
The airlines will begin the code sharing with an additional daily flight between Denpasar and Singapore starting August 2.
Initially, SIA will assume the role of operator by providing the flight, while Garuda will act as marketer and sell the seats. In the future, the companies will share the services.
"(The new flight) will increase our capacity, so our passengers from Saigon or Beijing can go directly to Bali from Singapore. The new schedule is also an improvement," Garuda Indonesia commercial director Agus Priyanto said.
Currently, Garuda operates 11 flights per week for the Denpasar-Singapore route, while SIA operates eight per week.
Garuda will also benefit from a special arrangement on ticket rates referred to as the special prorate agreement (SPA) for flights between Indonesia and Singapore that continue to Europe, China, India, Japan, the U.S. or Southeast Asia.
SIA is similarly entitled to the SPA for flights between Singapore and Indonesia that continue to Australia or north Asia.
SIA's Chew said he was especially pleased to be able to tap into Indonesia's tourist destination routes.
The two company chiefs said air traffic between the countries remained high.
Chew said air traffic from Asia, the EU, Australia and New Zealand remained busy, but that trans-Atlantic flights to the U.S. had seen a huge reduction in tourist travelers.
"Instead of traveling across the Atlantic, people travel regionally. We have seen more travelers from Japan and Australia," Agus of Garuda said.
Garuda recorded a 7 percent increase in passengers in this year's first quarter compared to in the same period last year.
Agus said Garuda was currently experiencing a load factor of 85 percent of capacity, and that the airline was preparing an additional 70,000 seats for the holiday season, 40 percent of which will be designated for regional travelers.
Having received two new airplanes in the last two months, Garuda plans to add one extra trip to its existing five flights per week to Sydney and one to its three flights per week to Melbourne. The agreements and pricings will be reviewed seasonally in March and October.(mri)
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