Garuda chief keen to get back in air

the airline has ‘fared better than most’, with more than 80 per cent of its business in the domestic market.

Garuda had a buoyant August on the back of an upswing in domestic travel Photographer: Dimas Ardian/Bloomberg

Irfan Setiaputra hates Zoom.

The chief executive of Indonesia’s national carrier Garuda, who took the helm weeks before the coronavirus pandemic brought the global aviation industry to its knees, can’t wait for the day face-to-face meetings resume and ­people can once again fly with confidence.

In the meantime, the former telco and mining executive — with no prior experience in aviation — is having conversations on topics he never imagined having to entertain.

Will planes need to be reconfigured to accommodate lingering post-COVID phobia over close contact?

How to break even on flights that are only allowed to carry 50 passengers to Australia without gouging passengers?

How to maintain the “happiness” of air travel without compromising safety and having your flight attendants look as though they’re working an intensive care unit?

“We are discussing these things but not yet making decisions public. We can’t assume that what’s happening today will be over one day. It’s much more important that we make sure that people fly safely,” he told The Australian.

“I don’t want to sit down and discuss the future yet because that will only happen when we survive this.”

With Garuda being a partially state-owned airline servicing a sprawling and highly populated archipelago, Mr Setiaputra says it has fared better than most, with more than 80 per cent of its business in the domestic market, though it still posted a first-half loss of $977m this year.

It has cancelled the delivery of 49 Boeing 737 MAX aircraft and is awaiting an 8.5 trillion rupiah ($795m) government bailout already approved by parliament.

He is hoping the money will see the carrier through the worst of the pandemic, and allow it to avoid the large-scale lay-offs now occurring at other regional carriers.

Singapore Airlines announced last Thursday it was slashing 15 per cent of its workforce and — even after a hiring freeze, early retirement and natural attrition — would need to cut an extra 2400 positions. Cathay Pacific is also rumoured to be preparing for a job purge as part of a restructure that anticipates the need for fewer staff and planes for the next four years.

Irfan Setiaputra Garuda Indonesia CEO ..

Garuda had a buoyant August on the back of an upswing in domestic travel, thanks to two long weekends and as a result of the July 31 reopening of Bali for Indonesia-based tourists.

But the country is paying for that increased mobility with soaring infections that forced the Jakarta government to reimpose large-scale social restrictions from Monday. Other cities and provinces are expected to follow.

“It’s a challenging situation but we will just have to wait and see whether other cities outside Jakarta make similar decisions. At the end of the day, airlines only fly if they have passengers,” Mr Setia­putra said.

“The issue is how long does it take the industry and airlines to recover? The general conclusion is between two and four years but as CEO of Garuda I can say two years is too long.”

The company is looking for new revenue streams through increased cargo loads and the charter business. Garuda managers took a 50 per cent pay cut in April that will extend at least to the end of the year. Most staff have also taken a 10 per cent temporary cut.

Of its 8000-strong workforce, about 800 are on unpaid leave, 150 more have had their contracts paid out, while about 500 are ­expected to take voluntary early retirement.

But Mr Setiaputra said the ­national carrier had a clear obligation to preserve jobs and maintain connectivity regardless of the circumstances. “This is a country where it’s not easy to travel from one place to another,” he said.

“We have so many islands. It’s also a government obligation to protect and serve Indonesians who reside outside Indonesia. This means if you’re Indonesian and you’re in Europe or Australia and want to come back home it’s the government’s obligation to fly you home.”

The airline has taken that mandate seriously during a pandemic that prompted other operators to suspend most of their routes. It has, “on principle”, maintained all international routes except to mainland China and Saudi Arabia, and for months has been the only airline flying between Indonesia and Australia, albeit with a now slashed schedule of three return flights a fortnight between Jakarta, Sydney and Perth.

“The only way Garuda will stop flying between Australia and ­Indonesia is if our government disallows us or your government rejects us,” Mr Setiaputra said. “There are still Australians who want to come back to Australia. There are Indonesians who want to come back to Indonesia. There are still goods to be delivered between Indonesia and Australia.

“Hopefully, people will feel good about the fact we were here during the bad times. And when the good times come they will choose to fly Garuda because we were the only ones bringing you back to your kids.”

Additional reporting: Chandni Vasandani