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Analysis: Airport firms merged to create one the world’s biggest operators
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Passengers walk past a Citilink aircraft at Kualanamu International Airport (KNIA) in Deli Serdang, North Sumatra, in June 2015. Kualanamu International Airport is among the airports managed by state-owned airport operator PT Angkasa Pura II. (JP/Dhoni Setiawan))
T
he government has merged the country’s two state-owned airport operators into one, PT Angkasa Pura Indonesia, in a bid to improve efficiency, and eventually cut logistics costs in the country, while at the same time improving profitability. After the merger the new entity is now called InJourney Airports, part of giant state-owned aviation and tourism holding company PT Aviasi Pariwisata Indonesia (InJourney).
Putting the two airport operators – PT Angkasa Pura I and Angkasa Pura II – under InJourney has raised eyebrows among analysts as the giant holding company oversees so many companies in different aviation and tourism sectors, some of them are loss-making businesses, including PT Pengembangan Pariwisata Indonesia (Indonesia Tourism Development Corporation/ITDC) that manages among other facilities, the loss-making Mandalika race circuit in Lombok, West Nusa Tenggara.
Before the merger, Indonesia had two airport operators, PT Angkara Pura I and Angkasa Pura II. Angkasa Pura I managed airports in the western part of the country, including the country’s busiest airport, Soekarno-Hatta International Airport in Tangerang, Banten, that serves Greater Jakarta, while Angkasa Pura II managed airports in central and eastern parts of Indonesia, including I Gusti Ngurah Rai International Airport in Bali. The two airport operators since 2021 have been put under state-owned aviation and tourism holding company PT Aviasi Pariwisata Indonesia (InJourney).
InJourney initially renamed Angkasa Pura II as PT Angkasa Pura Indonesia, and then merged Angkasa Pura I into Angkasa Pura Indonesia, which was later rebranded InJourney Airports. According to InJourney CEO Dony Oskaria, InJourney Airports now manages a total of 37 airports across the country, making InJourney Airports the world’s fifth-biggest airport operator.
InJourney Airports CEO Faik Fahmi promised to bring global-level services especially into its international airports. To do that, it will carry out a renovation of Soekarno-Hatta and increase the capacity of I Gusti Ngurah Rai, the two largest airports in the country, serving international travelers.
State-Owned Enterprises (SOE) Minister Erick Thohir has his own target for InJourney Airports. First and foremost, the merged operator has to improve efficiency and contribute to reducing the country’s logistics costs, but at the same time improve profitability. Official data show that air transportation contributes about 5.7 percent to the country’s total domestic logistic costs or 0.8 percent of the country’s gross domestic product (GDP).
InJourney Airports is currently the biggest sub-holding under InJourney, which also oversees five other sub-holdings, including hospitality with Inna hotels across the country, retail (Sarinah department stores), destination management (Candi Borobudur, Prambanan and Ratu Boko in Central Java and Taman Mini Indonesia Indah in Jakarta), aviation services (ground handling and cargo terminal operator services) and tourism development (Nusa Dua in Bali, Mandalika, and Gori Moro in East Nusa Tenggara).
