Garuda Indonesia grounds two-thirds of fleet
National carrier Garuda Indonesia has grounded two-thirds of its fleet, citing leasing issues and maintenance needs.
An aircraft of carrier Garuda Indonesia. (Photo: Samchui.com)
Jakarta (VNA) - National carrier Garuda Indonesia has grounded two-thirds of
its fleet, citing leasing issues and maintenance needs.
The
carrier wrote in a statement sent to the Indonesia Stock Exchange on June 9 that
it was operating only 53 airplanes of the 142 in its fleet, reported The Jakarta Post.
Of the non-operational planes, 39 are under maintenance. It did not specify the status of the 50 remaining aircraft, most of which are Boeing 737-800s and Bombardier CRJ1000s.
The company is still negotiating with lessors over the grounded aircraft, either to resume their operation or return them, the statement said.
Garuda has been facing deep financial problems because of record low domestic and international air travel demand.
The carrier, which leases 95 percent of its fleet, is seeking to return many of its leased planes to cut back on operational expenses.
Garuda has not submitted its full-year 2020 financial report, but its third-quarter financial report shows 1.07 billion USD in net losses in the first nine months of 2020.
The Ministry of State-Owned Enterprises estimates that the carrier has over 4.5 billion USD of debt and loses more than 100 USD million monthly.
The airline is seeking to save on employment costs by cutting wages, delaying salary payments, speeding up early retirement programmes and terminating contract workers.
"The company estimates over 23 million USD in unpaid wages as of December 31, 2020," said the statement.
Earlier, Indonesia’s deputy minister for state-owned enterprises, Kartika Wirjoatmodjo said Garuda Indonesia was seeking suspension of debt repayments in order to try to avoid bankruptcy.
Wirjoatmodjo said at a parliamentary hearing that Garuda and the government have appointed legal and financial consultants for the process.
If an agreement is not reached with the creditors, the airline could go bankrupt, he said./.
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