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THE COVID-19 pandemic still brings turbulence to the aviation industry in the world, and Indonesia is no exception. Losses and laid-off employees are options that are difficult to avoid.
This condition can be seen at least from the two airlines that rule Indonesia’s skies, namely PT Garuda Indonesia Tbk (GIAA) and Lion Air Group. According to the records, during the first quarter of 2021, GIAA recorded a net loss attributable to owners of the parent entity of US$384.35 million, an increase from the same period in 2020 which amounted to US$120.16 million.
In terms of total revenue, GIAA’s revenue in the first three months of 2021 was only US$353.07 million. This revenue fell 54.03% when compared to the total revenue in the first quarter of 2020 which amounted to US$768.12 million.
Elsewhere, Lion Air Group also set a strategy to maintain the continuity of the company. Still operating in stages, Lion Air Group operates an average of 10% -15% of its normal capacity before the COVID-19 pandemic, which is an average of 1,400 flights per day.
Lion Air Group also announced a reduction in the workforce by laying off employees (status without termination of employment) according to the workload in each unit, which is approximately 25%-35% of employees from 23,000 employees.
Meanwhile, General Chairperson of the Indonesia National Air Carriers Association (INACA), Denon Prawiraatmadja said that his party was concerned about the current situation of airlines in Indonesia. As long as the COVID-19 pandemic has not been resolved, the airline industry and airline companies will still be under pressure.
He hopes that vaccination can be accelerated so that herd immunity can be formed more quickly. That way, people’s mobility and the use of air transportation can quickly recover.
“INACA hopes that the implementation of vaccines can be carried out more quickly and in large quantities, because vaccines are expected to be a solution to health and economic problems. The main key for all airlines and economic activities is handling the pandemic,” Denon remarked.
Likewise, observer from the FEB UI Management Institute Toto Pranoto agrees, the situation in the aviation industry has not shown a recovery trend this year. Moreover, the pandemic that has not been fully controlled has made the mobility of people and goods still very limited.
The International Air Transport Association (IATA) also projects that in 2021 global airlines will still record losses. Therefore, GIAA and Lion Air Group are also implementing a strategy that is also applied by many other airlines in the world.
“So, cost restructuring is a priority step, especially simplifying the number of planes, because leasing costs are very expensive. Simplification of the number of human resources is also carried out so that overhead costs can be reduced,” Toto noted.
On the other hand, continued Toto, efforts to diversify income must also continue to be improved, especially from the cargo transportation business. For passenger load factor utilization, promotion strategies such as selling discounted tickets and other promotions need to be considered. Hopefully also captive markets such as Umrah flights can be reopened. So, these two airlines can breathe a little. [kontan.co.id/photo special]
