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Jakarta Post

Airline industry to remain stagnant this year amid safety worries

  • The Jakarta Post

    The Jakarta Post

Jakarta   /   Mon, January 4, 2016   /  04:44 pm

Safety and security concerns will remain top challenges for Indonesian airlines in 2016 after several accidents were recorded last year despite the government'€™s ambitious plan to improve the country'€™s international safety category.

The country recorded 14 airline-related accidents and incidents in 2015, an increase from the four accidents of the previous year, according to data compiled by airline consulting firm CSE Aviation.

One of the most notable accidents was the crash involving Trigana Air in Oksibil, Papua, killing all 54 passengers on board.

'€œOperational wise, 2015 didn'€™t look good with so many accidents and incidents. There hasn'€™t been much improvement in safety and security,'€ said aviation expert Samudra Sukardi.

He added that the government had failed in 2015 to upgrade the country'€™s Category 2 status to Category 1. These categories are set by the US Federal Aviation Administration (FAA).

The FAA downgraded Indonesia'€™s aviation safety to Category 2 seven years ago, signaling that the country lacked the regulations necessary to oversee air carriers in accordance with minimum international standards.

Transportation Ministry director for air transportation Muzaffar Ismail previously stated his office had undertaken corrective actions from 21 findings outlined by the organization, which mainly focused on

The FAA has given Indonesia an auditing slot for February 2016.

The ministry also highlighted the fact that it had fulfilled 94.9 percent of International Civil Aviation Organization (ICAO) safety standards in November, an increase from 45.3 percent in May 2015.

It also allocated Rp 12.03 trillion (US$871.4 million) for transportation safety and security in 2015, a 139 percent increase from 2014.

However, accidents and incidents kept on happening, including the Aviastar plane crash in South Sulawesi that resulted in 10 casualties in October.

Transportation Minister Ignasius Jonan also said the ministry had actively promoted safety by freezing route permits for airlines whose aircraft were involved in crashes, as well as issuing regulations on the maximum age limit for airplanes at 30 years.

The ministry issued around 30 regulations this year to improve the safety, service and security of air transportation.

'€œThe government did issue regulations, but did the airlines comply? The companies have to be audited by inspectors and there are not enough inspectors,'€ he said, adding that the ministry had just 100 inspectors. It is thought that around 600 inspectors are needed in order to effectively audit all the airlines operating in Indonesia at present.

He said given all the problems, the safety issue would likely remain a major challenge for this year.

Aviation expert Edwin Soedarmo said safety concerns would also contribute to stagnant growth in passenger numbers this year.

'€œThe accidents will make people a bit choosy. But they can'€™t retreat from using aircraft,'€ he said.

Operational wise, 2015 didn'€™t look good with so many accidents and incidents. There hasn'€™t been much improvement in safety and security.'€

National flag carrier president director and Indonesian National Air Carriers Association (INACA) chief Arif Wibowo said he expected passenger growth for airlines this year to be between 8 to 9 percent, the same growth rate recorded in 2015.

In 2014, the number of passengers using airlines hit 72.6 million people, a 5.6 percent increase from 2013.

'€œIt will still be single digits. But we have to be careful because this growth will have to be secured in our bottom line,'€ he said.

Arif also said that airline operators would aim to improve safety, security and service.

'€œAll of the airlines have to have their service certified by ISO [International Standard Organization]. When people audit it, we will be alerted,'€ he said.

Garuda recently secured an ISO 9001:2015 certificate for delay management from the British Standard Institute Indonesia.

Arif said 2015 had been a challenging year for airlines with the steep currency drop, even though the industry had been helped by the declining price of avtur.

'€œIt will still be low next year, but it will also be off-set by the capacity growth,'€ he said.

The government, through its state-owned oil-and-gas firm, cut the avtur price by 1.5 percent for domestic flights and by 5.33 percent for international flights in contrast to the global price in a bid to cushion the airlines from the effects of the depreciating rupiah.

Avtur makes up to 50 percent of an airline'€™s operational costs, according to Jonan.

Lion Air operational director Edward Sirait also voiced similar concerns, arguing that the state of the global economy had affected the airline industry.

Edward also said that safety and security would remain his company'€™s priority going forward, even though the monitoring process would need a large commitment.

'€œI don'€™t think any [airline] would intentionally reduce its safety,'€ he said.

Lion Air made headlines after it left hundreds of passengers stranded at Soekarno-Hatta International Airport in Cengkareng, Banten, following a rash of flight delays.

Aviation observer Gerry Soejatman said instead of just improving safety, some of the ministry'€™s reactive policies were also adding to costs for the airlines.

'€œPolicies are often made thoughtlessly in reaction to incidents. For example, the introduction of price floors for regional routes soon after the Air Asia accident in December 2014. But these policies cause operational costs to go up,'€ he said.

The Transportation Ministry has so far revoked the air operator certificate for six airlines, including Nusantara Buana Air, Manunggal Air and Survai Udara Penas, all of which failed to fulfill minimum plane requirements in addition to having negative equity. (fsu, rbk)

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