A Sriwijaya Air plane being repaired at the Garuda Maintenance Facility (GMF) at Soekarno-Hatta International Airport in Tangerang, Banten.(Antara Photo/Muhammad Iqbal)

Garuda Indonesia Ends Partnership With Sriwijaya Air


NOVEMBER 07, 2019

Jakarta. Flag carrier Garuda Indonesia announced on Thursday that its on-off partnership with the country's third-largest airline, Sriwijaya Air, was finally terminated on Oct. 31.

The airlines had reconciled and resumed the partnership in early October after a management conflict.

"Sriwijaya's transitional board of directors [during its partnership with Garuda] was disbanded on Oct. 31," Garuda corporate secretary Ikhsan Rosan said in a statement.

Sriwijaya will now be solely responsible for its obligations to lessors.

"We have been negotiating with Sriwijaya's shareholders on its debt payments to state institutions such as BNI, Pertamina, GMF, Gapura Angkasa and others," Ikhsan said.

Sriwijaya still owes Rp 942 billion ($67 million) to state energy firm Pertamina, Rp 810 billion to Garuda Maintenance Facility (GMF), Rp 585 billion to Bank Negara Indonesia, Rp 130 billion to airport operators Angkasa Pura I and Angkasa Pura II and $15 million to spare parts and equipment suppliers.

The partnership with Garuda Indonesia was formed to rescue Sriwijaya from bankruptcy last year.

Ikhsan said he hoped Sriwijaya will show willingness to pay off its debts.

The Transportation Ministry's directorate general of aviation said the termination of the partnership had caused the cancellation of some Sriwijaya Air and NAM Air flights operated by the Sriwijaya Air Group.

Sriwijaya has only been able to fly 13 out of its fleet of 30 airplanes, with the rest either being repaired or having been grounded due to another terminated partnership on spare parts provision with GMF, Polana Pramesti, the director general of aviation, said on Thursday.

"Our duty as a regulator is to ensure safety of and easy access for air transportation users as regulated by the 2009 Aviation Law," Polana said in a statement.

Among other things, the regulator will make sure that Sriwijaya's customers can get refunds for canceled flights and compensations for delays.