Garuda Indonesia resumes international expansion with Singapore focus. A Changi hub will test it.

Garuda Indonesia is planning further expansion in Singapore with the Jun-2016 launch of services from Medan. The addition of Medan will give Garuda six routes from Singapore compared with only two three years ago, including two one-way links to Europe.

However, the re-establishment of a Singapore hub, which Garuda operated several years ago, is far from ideal and will likely be temporary. Competing with the Singapore Airlines Group, particularly on the Singapore-Amsterdam and Singapore-London routes, is challenging.

Garuda is resuming international expansion after restructuring its international operation in 2H2014 and 2015. International ASKs were up 11% in 1Q2016 but its load factor dropped to only 70.6%, an indication of the challenges that Garuda faces in the highly competitive international market.