Indonesia AirAsia considers extra aircraft and full fleet deployment

AirAsia Indonesia Airbus parked at Jakarta terminal.
Photo Credit: Indy Udol

LONDON – In a steady return to pre-pandemic operations, Indonesia AirAsia (QZ) has plans to reinstate all of its A320s back into its active fleet by 2023.

In addition, it is also mulling over the possibility of bringing in extra aeroplanes to support the impressive growth.

Company’s CEO Veranita Yosephine Sinaga along with company secretary Leon Ruben laid out its 2023 strategy during a shareholder’s briefing on December 21st 2022. 

The airline has 16 of its 23 Airbus A320s operational, mainly out of its hub of Jakarta Soekarno Hatta International Airport.

The company’s top woman stated that the additional capacity was “tremendously” needed throughout 2022. This exponential growth is expected to carry on to 2023 and beyond. 

When she was asked about the idle planes on the tarmac scattered at Indonesian airports, Sinaga added that “efforts are being made to resume operations soon… we are quite confident that we can recover overall in the next few months.”

The next hardest task will be reactivating the inactive fleet. The airline indeed has come a long way from the midst of the pandemic. 

Indonesia AirAsia Profile

The airline is exclusively operating an all-Airbus fleet, namely the A320-200 CEO fleet. The airline has collated 3.44% of the country’s market share (measured by seat capacity).

3.44% seems a little minimal, when compared to the other giants, such as Lion Air and Citilink, Indonesia AirAsia lags behind its peers when it comes to domestic and local routes and operators.

However, it does significantly well in the international market (outbound/inbound) from Indonesia at 12.9% of the market share. 

The airline’s CEO acknowledged that Indonesia AirAsia’s somewhat stronger international market segment gives confidence to its shareholders and can possibly perform tourism campaigns for Indonesia.

This could mean the airline could engage with hotels, tour companies and tourist authorities in Indonesia to drive foreign traffic to Indonesia. This is one of the main advantages of the airline having a decent market share per seat in international sectors. 

Sinaga added: “It is a great opportunity to stimulate demand by using promotional methods and marketing assets that we have.”

She continued: “Currently, the focus of the company is still to maximize operations by increasing the aircraft fleet and opening new routes domestically and internationally while continuing to search for opportunities to strengthen capital.”

What’s next? 

The company’s top woman did not mention the timeline of fleet renewal or expansion, nor the number of aircraft considered. Sources say that the aircraft will likely not be bought but leased.

The airline reported earlier that their capital expenditure for 2023 was already high and may not leave room for the full acquisition of an aircraft.

In fact, only a sole A320-200 is owned by the carrier, signifying that the airline will only move forward in terms of fleet expansion by lease. 

We believe that there will be a serious consideration of extra aircraft as China gradually reopens, as this will inevitably increase passenger traffic in the region.

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