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Garuda Indonesia faces lawsuits at home and abroad
Garuda Indonesia is facing multiple lawsuits from foreign and domestic aviation companies, including an insolvency lawsuit from aircraft leasing firm AerCap Ireland being heard in New South Wales, Australia.
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Garuda Indonesia flight attendants welcome guests on Nov. 27, 2019 during the unveiling of the flag carrier's new Airbus A330-900neo at Soekarno-Hatta International Airport in Tangerang, Banten. (JP/Dhoni Setiawan)
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lag carrier Garuda Indonesia is facing an insolvency lawsuit over its failure to pay aircraft lease while trying to stay afloat in an industry severely hit by the COVID-19 pandemic.
Publicly listed AerCap Ireland Ltd., an aircraft leasing firm based in Dublin, filed on June 4 an insolvency lawsuit against Garuda with the Supreme Court of New South Wales in Australia.
During the ongoing trial, Garuda was “in the process of negotiating with AerCap to reach a commercial deal and restructure the contract outside the Court”, the 72-year-old airline company stated in its financial report released on Friday.
In 2020, the report also said Garuda saw its net loss swell to $2.44 billion from $38.93 million a year earlier, while revenue fell 67.36 percent year-on-year to $1.49 billion.
The insolvency lawsuit came around two weeks before the Indonesia Stock Exchange (IDX) suspended trading of Garuda shares after the airline failed to make timely coupon payments worth US$14.8 million on its global sukuk.
The airline operated less than one-third of its fleet in May, with the rest grounded due to the outstanding lease issue.
Read also: IDX suspends trading of Garuda Indonesia shares after airline defaults on sukuk
