Adam Air to Expand Operations in Indonesia

In a Business News report it was interesting to read that the 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. These will consist of Boeing 737-400’s which can carry up to 170 passengers. The airline preferred to lease aircraft rather than purchase new aircraft because it was cheaper.

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. Their [Adam Air] intentions are to dominate the domestic market by adding the newly leased planes to serve the Jakarta to Ambon, Mataram, Kupang, Palu and Kuala Lumpur routes.

According to a Adam Air spokesperson, there was 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.

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.

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).