Indonesia's state-run airlines Garuda Indonesia posted losses of 206.4 million U.S. Dollars in the third quarter of this year following the depreciation of the nation's currency in the last few months and the swelling price of fuel that contributes to 40 percent of the firm's operational cost, a senior company official said here Thursday.
To respond to the losses, the firm planned to take efficient moves, including stopping the operation of old planes and postponing the delivery of new planes it has ordered from foreign producers.
"Garuda would also postpone the opening of new international flight services, stop services to destinations," Garuda Indonesia President Director Emirsyah Satar said in a statement.
He said that with these measures, Garuda would reduce its capital expenditure by 54 million U.S. dollars.
He added that the firm would improve cooperation with global airline alliance SkyTeam to boost its existing international services.
According to Emirsyah, the ongoing global economic slowdown also contributed to the Garuda's decreasing demand for flights serving international routes, apart from the sluggish development of the nation's air transport infrastructure that led to inefficiency in the company's operation.
Investment in Garuda's budget flight subsidiary of Citilink was also part of factors contributed to the firm's losses. Over the last two years, Garuda had been preparing Citilink to serve several domestic destinations for the implementation of the ASEAN Open Sky policy scheduled to take into effect next year in Southeast Asia.
The firm operates 141 planes of various types at present.