When CEO (“direktur utama”) was fired in early December 2019, several comments came up commenting Garuda Indonesia (Indonesian flag carrier airliner) business model. One of them are of the chair of Indonesian Association of Hotel and Restaurant, Mr. Hariyadi Sukamdani, who alleged a practice of cartel by Garuda Indonesia. It conforms the inquiry by Indonesian Commission on Competition Oversight (KPPU) who invariably pointing to the practices of airliners, one of them through ticketing, which becoming a cartel.
Since deregulation of US air transport (Air Deregulation Act 1978) which broke the control of Civil Aeronautics Board, the airline industry keeps on looking ways to make the industry sustainable. Even more so with the coming of no-frills flight popularised by Soutwest Airlines, and now practised by many. This model gives way to the flexibility in the economy of airliners.
So far, the economy of airliners relies on some of following:
- Air route
- Structure of cost and financing
- Fuel cost
Suppose that air-transportation grows in its economy, we will be encouraged to assume that, then, scale, will help airliners to keep their financials healthy –and in turn, they can contribute to the more affordable travel.
For Indonesia, air transportation is so fundamental. Taking every ingredients of air transportations into consideration, then, the future of travel is key interest of the nation.