Lion Air Founders plans to introduce New Airline

The founders of Indonesian low cost carrier PT Lion Mentari Airlines, operating as Lion Air, are planning to introduce a new airline in the country. This development will help the airline’s efforts to surpass one of the biggest disasters in the aviation industry.

This new carrier is a project initiated by the founders, including Mr. Rusdi Kirana, of the Lion Air. The low cost carrier has been working hard to move forward from the fatal crash in year 2018. The cause of the plane crash was the design flaws of Boeing Co’s 737 Max jet and a raft of errors made by the pilots and mechanics on the plane. Boeing has confirmed that it has resolved 90 per cent of faulty death claims as of July.

Mr. Budi Prayitno, a spokesperson for the Ministry of Transport, confirmed that it is processing an application for an air operator certificate, but declined to provide further details. Mr. Danang Prihantoro, spokesman for Lion Air, has also declined to comment on the matter and Mr. Kirana could not immediately comment.

Mr. Shukor Yusof, founder of Malaysian aviation consulting firm Endau Analytics, said that the new carrier can provide founders with a new starting point. He stated, “Don’t underestimate Rusdi”. He added that closely related Lion has a much better levitation ratio than its competitors in Southeast Asian regions and many 737 Max orders can prove valuable once the COVID-19 pandemic came to an end.

Like airlines around the world, Indonesian airlines are also suffering from a decline in passenger numbers due to travel restrictions imposed to limit the spread of the virus. As per the reports from the statistics bureau, although the number of air travel in the country’s huge archipelago rebounded from 87,000 in May to 1.46 million people in July, it is still far below 7.14 million in the same month last year.

On a global scale, airlines are in trouble. American Airlines Group and United Airlines Holdings will cut a total of 32,000 jobs due to the ongoing debate about new government assistance. The International Air Transport Association (IATA) predicts that air travel in December will drop by 68 per cent from the previous year due to the impact of resurgence of coronavirus in European countries.

Meanwhile, the national carrier PT Garuda Indonesia relies on the government’s bridging loan to avoid going into bankruptcy and Air Asia Group hopes to inject cash before the end of the year to survive.