Indonesia’s flag-carrier Garuda Indonesia is reportedly planning to return two of its Boeing 737 aircraft to the lessor. The move comes as it strives to survive the setbacks of the COVID-19 pandemic.
As part of the airline’s potential major restructuring, the second largest carrier in Indonesia is planning to return two of its Boeing 737-800 aircraft to the lessor before their lease term ends, according to the statement seen by Reuters on June 7, 2021.
Garuda has a fleet of 139 aircraft, which are 9 years old on average. The largest part of the airline’s fleet consists of the Boeing 737 aircraft family: 71 Boeing 737-800s and one Boeing 737 MAX aircraft. Adding to that, Garuda operates 27 Airbus A330s, 18 Bombardier CRJ-1000s, 12 ATR-72s, and 10 Boeing 777-300ER aircraft.
Due to the ongoing crisis, the airline is already operating only half of its fleet, 52 aircraft, planespotters.net data shows.
The cash-strapped Indonesian air carrier is operating at reduced capacity due to pending payments for its aircraft lessors, according to Garuda Indonesia President Director Ifran Setiaputra. The latest airline’s financial reports state that the Indonesian carrier suffered a net loss of $368.4 million in the third quarter of 2020.
“Compliance with COVID-19 measures and the corresponding decreases in passenger and demand for air travel have resulted in a significant reduction in number of flights, which in turn has adversely impacted the company’s operations, revenues, cash flow and profitability,” read Garuda’s statement.
The ongoing COVID-19 pandemic forced many airlines, including Thai Airways, LATAM Airlines, HNA Group, to take similar restructuring or bankruptcy protection measures in order to survive the crisis.