PARIS: PT Garuda Indonesia Tbk purchased 50 units of A320 aircraft series for US$2.2 billion.The purchase, which was confirmed with the signing of MoU with Airbus Industrie at Paris Airshow, is expected to back up the operation of Garuda's stategic business unit, Citilink, in the future. The stronger Citilink is aimed at low-income segment of passengers that has double digit growth in the last five years across Asia Pacific, said President Director Emirsyah Satar.The agreement says that of 50 aircrafts purchased, 25 units will be a firmed order and the other 25 units are additional. The ordered 15 units of standard A320 series and 10 units of A320 Neo series will join Citilink fleet at gradual basis starting 2014 until 2018, or five units at each year.According to Emirsyah, to opt to A320 series indeed has gone through evaluation that it needs to make uniform the fleet to boost efficiency."A320 is suitable for low-cost service for its reliability and comfort besides 15% saving in the fuel," he said.Airbus Chief Operating Officer for Customer John Leahy said room for cooperation between Airbus and Garuda to improve market penetration in Indonesia is still big. The Indonesia's air passengers currently reach 4% of total population at 240 million. Garuda will benefit from export credit from banking industry coupled by sales and lease back scheme to finance the aircraft's purchase. A number of lessors from China, US, and Europe, have offered cooperation opportunity for being A320 lessors. "We may combine one-third internal portion with leasing scheme. For prepayment we will use the proceeds from IPO," he added.Sriwijawa's orderMeanwhile, Sriwijaya Air's CEO Chandra Lie said the company also just signed a purchase agreement for 20 Embraer 190 jets with option of additional 10 aircrafts for US$1.18 billion at the same event. The aircraft series, he said, will support the company's plan to expand into new domestic markets besides replacing the small aircrafts.E190 aircraft has capacity of 100 seats and serves only one class. Embraer's President for Commercial Aviation Paulo Cesar de Souza e Silva saw the transaction as new history to enter Indonesian market. (NOM)
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