Garuda Indonesia seeks a halt in aircraft delivery as focus shifts to utilisation, profitability

Garuda Indonesia is aiming to halt all aircraft deliveries for two to three years as part of an initiative to improve its financial position. The group still intends to grow capacity by 10% to 12% per annum by improving utilisation of its existing fleet, which will result in lower unit costs and higher efficiencies.

Garuda has begun negotiations with manufacturers to defer A320neos, A330-900neos, 737 MAX 8s and ATR 72-600s. The group has set an objective of not taking delivery of a single new aircraft in both 2018 and 2019, including aircraft for its LCC subsidiary Citilink.

However, the objective seems unrealistic, particularly for most of the 2018 deliveries. Citilink will likely take three A320neos in 2018 as initially planned, since the buyer-furnished equipment has already been acquired. Garuda may, similarly, not succeed at entirely halting 737 MAX 8 deliveries after taking its first of the type in Dec-2017.