CITILINK’s air operation certificate will be issue this month

Ministry of Transportation confirmed that it will issue a air operation certificate or SIUP of PT Citilink Indonesia, a subsidiary of PT Garuda Indonesia Tbk, in this month.

"If there is no problem, Citilink’s SIUP will soon come out this month. Garuda Indonesia Itself has established PT Citilink Indonesia, so the management is able to more quickly, "said PLT Director of Air Transport Directorate General of Civil Aviation Ministry of Transportation Djoko Muratmodjo, Wednesday, January 4, 2012.

He added Citilink operating license issuance process is now entering the final stage of correction, especially related to the airline's business plan. "Later, based on a business plan that made it, Citilink shall deposit initial capital into the bank. Proof of deposit deposit is sent to Ministry of  Transportation and became one of the conditions for issuing of the SIUP, "he said.

Finance Director of Garuda Indonesia, Elisa Lumbantoruan said it had prepared all of the requirements for discharge SIUP. "We're ready, even send other requirements are met, capital, and the terms of the plane," she said.

Previously, Garuda Indonesia management targets in the first quarter of 2011 will stand with PT Citilink Indonesia which have Business License and Air Operation Certificate (AOC) is separate from Garuda Indonesia. Citilink is a subsidiary of Garuda Indonesia, which serves low-fare airlines or low cost carrier (LCC).

Citilink currently has 10 aircraft. In 2012 will be operated 20 aircraft. By the end of October 2011 the number of passengers Citilink 1.26 million. The plan uses a fleet type of A320 for the next 5 years.

Garuda Indonesia President Director, Emirsyah Satar previously said it targets the separation of Citilink from the particular division into a separate subsidiary began the quarter I/2012. "Spin off [separation of Citilink] has targeted for completion on the first quarter of 2012, now is still a process," said Emirsyah. In the early flying after the spin off, Emirsyah target operates 10 aircraft with a new look or new livery.

"Until the end of 2011, there are 10 units of aircraft to Citilink which consists of 4 units of Airbus and 6 units of Boeing, while at the end of 2012 will amount to 20 units. Furthermore, we will increase because we have order other 25 units," said Emirsyah.

He added, Citilink will be able to increase the number of passengers that will be accumulated to the parent company Garuda Indonesia. "Until the end of 2011, Garuda Indonesia predicted to carry 17 million passengers, up 37%. Until November, the number of passengers Garuda Indonesia and Citilink has reached 15.5 million. Contributions from Citilink is still small, "he said.

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CITILINK new flight routes: Surabaya to DENPASAR

Citilink, a strategic business unit of Garuda Indonesia Tbk opened new flight routes, ie from Surabaya to Denpasar and vice versa, yesterday. The opening of this route has been carried out following the arrival of two Airbus A320 aircraft.

"Bali is a very popular destination for prospective passengers in Surabaya and East Java," said Elisa Lumbantoruan, Chief Financial Officer Garuda Indonesia and Vice President of Citilink.

According to the plan, CITILINK will serve the Surabaya - Denpasar route twice daily, ie at 09:00 and 17:20 AM. While the flight from Denpasar to Surabaya at 11:20 AM and 19:40 AM.

During this time, Citilink serves Jakarta - Denpasar route, but do not have a route Denpasar - Surabaya. To inaugurate the opening of the new route, Citilink provides efficient promo fare of IDR 79,000 only.

With the arrival of two planes of Airbus A320, said Elisa, Citilink will also continue to expand its service network and increase flight frequency. During this time, Citilink provides low cost carrier. Citilink flights routes include the Jakarta - Medan, Jakarta - Denpasar and Surabaya - Batam, to Banjarmasin, Balikpapan and Ujungpandang.

Citilink as the Garuda Indonesia business unit that specializes in serving these low-cost flights from next year will be separated from Garuda Indonesia. The company will receive an initial capital injection of USD 100 billion to spin off that will be done in the first quarter or later than the second quarter of 2012.

Today, Citilink is in the process of taking care of Airline Operating License. The company also must operate a minimum of 10 units of aircraft as a stand-alone airline.

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Citilink Revision Number of Aircraft

Strategic business unit of PT Garuda Indonesia Tbk, Citilink, revised the number of aircraft to be operated until the end of this year. When originally projected Citilink will operates 15 aircraft, the target is reduced to 10 units.

President Director of Garuda Indonesia, Emirsyah Satar said, it was done because of Garuda Indonesia planes nevertheless grant that during this operation. "Garuda Indonesia’s plane is not suitable for Citilink, due to Citilink’s concept is the low cost carriers (LCC)," Satar said in Jakarta.

The plane which needed by Citilink is the aircraft with a capacity of 180 passengers, while the aircraft owned by Garuda Indonesia is the plane for the premium class with a capacity of 144 passengers. It is considered inefficient.

Therefore, Garuda Indonesia aircraft will not grant to Citilink. "Citilink has decided to operate the Airbus A320, so that Garuda INodnesia’s Boeing Series will be grounded and sold when it's not used anymore," he said.

Emir added that currently it had prepared to make Citilink a stand-alone company. The target is in 2012 has done a spin off.

"We have prepared a business plan that the Ministry of Transportation provide aviation business license this year, the target may spin off next year," he said.

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CITILINK will operate AIRBUS A320 in July 2011

Strategic business unit of PT Garuda Indonesia Tbk, Citilink will use its new fleet, the Airbus A320 in July 2011. The aircraft will be brought up to six units until the end of this year.

Finance Director of Garuda Indonesia, Elisa Lumbantoruan said, the procurement of modern aircraft are needed for business competition in the segment of low-cost airlines or low cost carrier (LCC).

Elisa explains, the arrival of the aircraft starting in July of two units, August and the remaining two units are expected to come until the end of the year. "Procurement done gradually," Elisa said.

The former boss of PT Hewlett Packard Indonesia, said the reason the election as a fleet of Airbus A320s which will be operated in the near future because of availability of aircraft and crew that is possible than the Boeing 737-800 NG. In addition, with a capacity of Airbus A320 can be maximized to 188 passengers, will be more efficient for Citilink. While competitors have been operating the fleet with the latest type and has a maximum capacity.

Citilink will separate from Garuda Indonesia

Garuda Indonesia plans to spin off (separation) of its strategic business units, Citilink. Spin-off will be done after the initial public offering (IPO) which scheduled on fourth quarter 2010.

"The most fast of the spin-off is in the second half of next year. If IPO will done this year, it takes approximately 3-6 months to conduct activities such as spin-off," said Director of Strategic and Technology Garuda Indonesia, Elisa Lumbantoruan.

According to Elisa, the spin-off was conducted aiming to isolate the resources side, as well as from the operational side of the two airlines. This is because the working culture of the two airlines will be very different due to class differences of the two airlines. Garuda Indonesia will go into Full Service class, while Citilink join in No-Frills or Low Cost Carrier (LCC) class. "In addition, the spin-off also can simplify the management of capital. For example make it easier to find partners or investors”, Elisa explained.

Citilink’s spin off has been scheduled since 2009. However. until now the spin off plan is intercept by a number of requirements in order to get SIUP (Aviation Business License) from the Ministry of Transportation, among them are the business plan and the procurement of the fleet. Since not get the SIUP yet, currently Citilink still become one with Garuda Indonesia. Citilink have the same flight number with Garuda Indonesia, which begins with the letters GA.