Deputy Minister Of BUMN: Garuda Indonesia Aircraft Rental Prices Successfully Reduced

JAKARTA - The Ministry of State-Owned Enterprises (BUMN) has succeeded in reducing the price of aircraft rental owned by PT Garuda Indonesia Tbk. This success was obtained after long negotiations with the lessor or the aircraft charter company.

Deputy Minister of SOEs II, Kartika Wirjoatmodjo explained, from the results of the negotiations, the rental price of Garuda Indonesia planes fell significantly.

At least, there are five planes whose rental costs have been negotiated by the airline.

One of them is the wide-body Airbus A330-300, which experienced a 65 percent decrease in rental costs from US$1,100 million to US$388,000 per month.

"These are examples that are quite extreme in wide body aircraft, especially long-haul flights or overseas," he said in a virtual press conference, Tuesday, June 28.

Then, Tiko as Kartika is familiar with, said the A330-200 wide body aircraft also experienced a 70 percent decrease in rental prices. From the price of 882 thousand US dollars to 265 thousand US dollars.

"Yesterday, the Boeing B777-300 was used by Mr. Jokowi. The most expensive lease rate is 1.570 million US dollars, down to 484 US dollars, or a 69 percent decrease," he said.

Meanwhile, for lean-bodied aircraft, there is a decrease that is not too large when compared to the value of the decrease in aircraft made of large material.

For example, the Boeing B737-800 decreased by 35 percent from the original US$330 thousand to US$215,000 per month.

Then, the Airbus A320-200 experienced a 35 percent decline from the original US$330 thousand to US$214,000 per month.

According to Tiko, the success of lowering the rental price of this aircraft is a good achievement for the Ministry of SOEs and Garuda Indonesia.

This is because, previously, the Garuda flight rental price was among the most expensive, even four times the rental price of other global airlines.

Not only that, said Tiko, PT Garuda Indonesia Tbk succeeded in reducing debt by 81 percent of the total debt with the restructuring.

With this reduction, the state-owned airline only needs to pay off the remaining 19 percent of the debt with the scheme agreed upon by the creditors.

Tiko explained that the 81 percent decrease was seen from the percentage point of view.

Meanwhile, in terms of value, he said, the decline was only about 50 percent of the total debt before the restructuring.

Citing Tiko's explanation, Garuda Indonesia's debt before restructuring amounted to 10.1 billion US dollars. Meanwhile, after the restructuring, Garuda Indonesia's debt value remains at US$ 5.1 billion.

"We are not only cutting debt, but lowering the cost of the lease rate. So that it can be as high as the average lease rate of other airlines in the world," he said.