AdamAir to lease more planes next year to expand operations

The Jakarta Post, Jakarta

Low-cost national carrier PT Adam SkyConnection Airlines plans to lease five more planes next year to expand its operations, and has set aside Rp 30 billion (US$3.2 million) for each plane, says the company's senior executive.

President director Adam Adhitya Suherman said Thursday that the planes would consist of Boeing 737-400, which can carry up to 170 passengers.

"We want to dominate the domestic market as we realize that traveling by plane has become essential for many people in Indonesia," he said, adding that the planes would serve the Jakarta to Ambon, Mataram, Kupang, Palu and Kuala Lumpur routes.

Adam said that the airline preferred to lease aircraft rather than purchase new aircraft as this was cheaper. He claimed that if the company bought new planes, one day they too would get old and it would cost the company even more on safety and maintenance.

He said that AdamAir, which boasts a 90 percent load factor, currently operates 23 leased aircraft and serves around 20,000 passengers per day on 150 flights connecting 23 cities.

The passenger figure represents a 20 percent increase from last year, which he said was a sign of recovery following a slump in passenger numbers in the wake of a deadly incident on New Year's day in 2007, when an AdamAir Boeing 737-400 went missing.

Its black box was later found and recovered from the bottom of the sea off West Sulawesi.

For next year, AdamAir is eyeing further expansion by entering into a collaborate arrangement with Bank Rakyat Indonesia (BRI) in a move designed to appeal to the bank's 30 million customers.

The agreement, signed Thursday, aims to facilitate customers by permitting them to pay for their tickets via BRI's automatic teller machines (ATM).

AdamAir said that BRI was the sixth bank it had teamed up with for such purposes after Bank Mandiri, LippoBank, Bank Niaga, Bank Permata and Bank Negara Indonesia (BNI). (ind)