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mercure1
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Garuda Plans Major Restructuring That May Halve Its Fleet

Mon May 24, 2021 3:06 pm

Loss making Garuda needs to completely restructure its business, potentially reducing the number of planes it operates to less than half its main fleet as the airline seeks to survive the crisis wrought by the pandemic, its president told staff last week.

“We have to go through a comprehensive restructuring, a total one,” President Director Irfan Setiaputra said in an address to staff on May 19, according to a recording heard by Bloomberg. “We have 142 aircraft and our preliminary calculation on how we see this recovery has been going, we will operate with a number of aircraft no more than 70.”

https://www.bloomberg.com/news/articles ... ting-fleet
https://www.cnnindonesia.com/ekonomi/20 ... i-karyawan

Will the government step in and save things, or is the situation so bad that they are willing to let market forces play out?
mercure f-wtcc
 
RoyalBrunei757
Posts: 350
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Mon May 24, 2021 4:28 pm

Let the guessing game begins:

Current fleet:
Airbus A330-200 - 7
Airbus A330-300 - 15
Airbus A330-800 - 4
Airbus A330-900 - 3
ATR 72-600 - 12
Boeing 737-800 - 73
Boeing 737 MAX 8 - 1
Boeing 777-300ER - 10
Bombardier CRJ1000 - 18
Total - 141

On order:
Airbus A330-800 - 4
Airbus A330-900 - 11
Boeing 737 MAX 8 - 49
Total - 97

Simplifying fleet moving forward:
Airbus A330-800 - 4
Airbus A330-900 - 14
Boeing 737 MAX 8 - 50
Total - 68

1. Eliminate 22 A330-200/300 to move over to A330-800/900 fleet. Those A330-200/300 which are around 5-8 years old maybe retained for Hajj purpose. Older A330-300 all-Y can be offloaded, either way.
2. Eliminate 6 Boeing 777-300ER - Too heavy, too much capacity, international route is not returning anytime soon. Better swallow the bitter pills now than later. This might lead to losing 5-stars airline status....F class will be out too.
3. Planned disposal of Bombardier CRJ1000 - 18. Done deal.
4. Retire 73 B737NG move over to B737 MAX, some domestic trunk routes to be flown by A330-800/900
5. Move 12 ATR 72 to Citilink.
 
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LAXintl
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Mon May 24, 2021 4:46 pm

It took the COVID crisis to prove the need for tough decisions at perennial loss making companies like Garuda, MAS and Thai.

How things play out at Garuda is still TBA, but business as usual should not be one of the options.

I suspect ever more domestic flying and portions of narrowbody fleet can be shifted to Citilink as part of GA restructure.
From the desert to the sea, to all of Southern California
 
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Polot
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Mon May 24, 2021 4:55 pm

RoyalBrunei757 wrote:
Let the guessing game begins:

Current fleet:
Airbus A330-200 - 7
Airbus A330-300 - 15
Airbus A330-800 - 4
Airbus A330-900 - 3
ATR 72-600 - 12
Boeing 737-800 - 73
Boeing 737 MAX 8 - 1
Boeing 777-300ER - 10
Bombardier CRJ1000 - 18
Total - 141

On order:
Airbus A330-800 - 4
Airbus A330-900 - 11
Boeing 737 MAX 8 - 49
Total - 97

Simplifying fleet moving forward:
Airbus A330-800 - 4
Airbus A330-900 - 14
Boeing 737 MAX 8 - 50
Total - 68

1. Eliminate 22 A330-200/300 to move over to A330-800/900 fleet. Those A330-200/300 which are around 5-8 years old maybe retained for Hajj purpose. Older A330-300 all-Y can be offloaded, either way.
2. Eliminate 6 Boeing 777-300ER - Too heavy, too much capacity, international route is not returning anytime soon. Better swallow the bitter pills now than later. This might lead to losing 5-stars airline status....F class will be out too.
3. Planned disposal of Bombardier CRJ1000 - 18. Done deal.
4. Retire 73 B737NG move over to B737 MAX, some domestic trunk routes to be flown by A330-800/900
5. Move 12 ATR 72 to Citilink.

Wouldn’t surprise me if the Max gets dumped and most of short haul narrow body flying shifted to Citilink (which operates the Neo).

Garuda said they were going to cancel the Max a week or 2 after the grounding started, but never did. Garuda had previously significantly deferred the order which is why they only have one to begin with (deferment was before Lionair crash, it had nothing to do with MCAS or reputation or anything).
 
ewt340
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Mon May 24, 2021 5:39 pm

They probably would move most of their domestic operation to Citilink since the demand for full service carrier is tiny in Indonesia.

ATR 72-600 is being moved to Citilink.
Bombardier CRJ1000 are Planned to be phased out.

They might ended up with 2 model instead. A330 and B737-800 or MAX.
 
chonetsao
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Mon May 24, 2021 5:55 pm

I think the 6 A333 in all economy class configuration will be gone.

Plus I don't think A330-800 is delivered yet. One article in March 2021 suggests there is no firm delivery date for those aircrafts yet. Those can be cancelled too. Thus it is safe to say if Garuda was to reduce fleet, the lone 4 A330-800 order could be in danger to go.

A330-900 will be coming as planned and may replace the 9 remaining A333 on one-to-one basis.
 
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UPlog
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Mon May 24, 2021 9:37 pm

Maybe GA can give up ideas of grandeur and forget thinking about service to Europe and US and focus regionally on Asia-Pacific region.

And yes a simpler B737+A330 fleet should serve it well.
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behramjee
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Mon May 24, 2021 10:38 pm

Before any fleet standardization can take place, GA needs to reduce its fixed costs + along with capital acquisition costs which would entail taking delivery and making PDPs (pre-delivery payments) on aircraft.

These would include a combination of two things i.e. cancelling many aircraft on order + deferring delivery of any that are due in 2021-22 to at least 2023-24 minimum. Aircraft which are fully paid off should not be phased out as they have no fixed cost to be incurred hence these need to be utilized to their maximum possible capabilities under the current precarious environment.

With regards to the B737Max order on hand, their lawyers need to find a way to get out of this contract by paying a minimal amount of penalties (if any).

As far as the 10 B77Ws are concerned, those need to be sold to raise cash and the unfortunate part is that there wont be any takers for this aircraft type this year or next year unless they can convince a big freight operator to purchase them and convert them into Fs.

The A330Neos, GA needs to negotiate a delayed delivery time frame in order to control its cash flow.

Yes they need not focus on EU/USA for the next 3-4 years and just revolve its network around the Austral-Asia region. They can use KL and KE whom are fellow Sky Team partners for EU/USA via their own operated flights.
 
DaCubbyBearBar
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Tue May 25, 2021 3:31 am

I think they should talk with Boeing and restructure the MAX order for later deliveries. Let the -800NG stick around for another 5-7 years before the MAX8 comes in as a replacement. Conserve that capital!!
I am me and no one else...so my opinions are mine
 
FromCDGtoSYD
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Tue May 25, 2021 4:23 am

GA has to make up their mind on a strategy and stick to it. Just its AMS/LHR routes have been a joke. From CGK-AMS-LHR, to CGK-SIN-AMS and CGK-LHR, to direct flights for the two, to the Bali route, back to Jakarta, then to Medan... Then on and off with first class.

They currently have 4 business class seats on their widebodies. Indonesia is badly located for connecting traffic but remains an important market. Europe should focus on AMS with the A330. I doubt there is a need for 10 777-300s. The single class A330s are used for pilgrimage flights I believe.

Then you have the MAX debacle, they've been flying around with 1 of these for a few years now. And don't get me started on the CRJ.

As others have pointed out they should really focus on 1 or 2 key points and become good at them instead of trying to change the world. Probably focus on inbound and outbound traffic within APAC, offer a competitive soft and hard product with reasonable timings and price and they will be fine. And then sort out their domestic goals, of its linking the big cities so be it, but they can't go around and be the governments way of having flights to ultra remote places, an LCC cost structure would be way more approriate for that.

I'm not saying they're gonna print money but if they can at least stop bleeding bucketloads.
 
RoyalBrunei757
Posts: 350
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Tue May 25, 2021 6:35 am

chonetsao wrote:
I think the 6 A333 in all economy class configuration will be gone.

Plus I don't think A330-800 is delivered yet. One article in March 2021 suggests there is no firm delivery date for those aircrafts yet. Those can be cancelled too. Thus it is safe to say if Garuda was to reduce fleet, the lone 4 A330-800 order could be in danger to go.

A330-900 will be coming as planned and may replace the 9 remaining A333 on one-to-one basis.

Did a typo there, this is should be the correct list:
Current fleet:
Airbus A330-200 - 7
Airbus A330-300 - 15
Airbus A330-900 - 3
ATR 72-600 - 12
Boeing 737-800 - 73
Boeing 737 MAX 8 - 1
Boeing 777-300ER - 10
Bombardier CRJ1000 - 18
Total - 141

On order:
Airbus A330-800 - 4
Airbus A330-900 - 11
Boeing 737 MAX 8 - 49
Total - 97

Simplifying fleet moving forward:
Airbus A330-800 - 4
Airbus A330-900 - 14
Boeing 737 MAX 8 - 50
Total - 68

The A330-800 order was firmed up only recently (March 2021) with Airbus after the latter disclosing it's name behind the unnamed customer LOI signed back in 2019. GA would have cancelled the LOI if they have not intention to purchase at first place, however as many here would agree, based on current circumstance, things are very fluid. I do see them flying a combination of A330-800/900 to Japan and Australia, in addition to AMS.
 
VSMUT
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Tue May 25, 2021 6:35 am

RoyalBrunei757 wrote:
Simplifying fleet moving forward:
Airbus A330-800 - 4
Airbus A330-900 - 14
Boeing 737 MAX 8 - 50
Total - 68

4. Retire 73 B737NG move over to B737 MAX


They definitely aren't moving to a 737MAX fleet with this move. Maybe in the long term, but this move seems to be more about conserving money, so they won't be adding new aircraft they have to pay for if it can be avoided. And either way, the MAX has yet to be cleared to fly in Indonesia, and may stay grounded there for some time.


chonetsao wrote:
I think the 6 A333 in all economy class configuration will be gone.

Plus I don't think A330-800 is delivered yet. One article in March 2021 suggests there is no firm delivery date for those aircrafts yet. Those can be cancelled too. Thus it is safe to say if Garuda was to reduce fleet, the lone 4 A330-800 order could be in danger to go.

A330-900 will be coming as planned and may replace the 9 remaining A333 on one-to-one basis.


The all-economy A330s could go to Citilink, couldn't they? The A330-800 order was firmed in March, I'd presume they wouldn't have placed it so close to this announcement if they didn't plan to take them.
 
LifelinerOne
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Tue May 25, 2021 6:41 am

DaCubbyBearBar wrote:
I think they should talk with Boeing and restructure the MAX order for later deliveries. Let the -800NG stick around for another 5-7 years before the MAX8 comes in as a replacement. Conserve that capital!!


Well, the airline has been very clear what they wanted to do with its MAX-order:

https://edition.cnn.com/2019/03/22/busi ... index.html
https://www.cnbc.com/2019/03/22/indones ... -jets.html

However, as it's still on the books with Boeing, it seems Garuda hasn't followed through. I do think they can wriggle out of the contract due to the aircraft being very late.

For me it would make sense to just offload all regional and domestic flights to CitiLink and have Garuda be the medium/long-haul airline with A330(neos). Traffic has shrunken anyway, so no need to add additional planes, return current aircraft to their lessors when leases are to expire and have CitiLink standardise on the A320(neo) and ATR72. And then grow from there if the demand returns. If needed, it can keep B737-800s for CitiLink as well and replace them in due time with A320neos to keep the fleet simple.

Then Garuda/CitiLink's set-up would be:

A320(neo)
ATR72
A330(neo)
B737-800

Cheers! :wave:
Only Those Who Sleep Don't Make Mistakes
 
RoyalBrunei757
Posts: 350
Joined: Mon Apr 12, 2021 6:18 am

Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Tue May 25, 2021 6:54 am

Polot wrote:
RoyalBrunei757 wrote:
Let the guessing game begins:

Current fleet:
Airbus A330-200 - 7
Airbus A330-300 - 15
Airbus A330-800 - 4
Airbus A330-900 - 3
ATR 72-600 - 12
Boeing 737-800 - 73
Boeing 737 MAX 8 - 1
Boeing 777-300ER - 10
Bombardier CRJ1000 - 18
Total - 141

On order:
Airbus A330-800 - 4
Airbus A330-900 - 11
Boeing 737 MAX 8 - 49
Total - 97

Simplifying fleet moving forward:
Airbus A330-800 - 4
Airbus A330-900 - 14
Boeing 737 MAX 8 - 50
Total - 68

1. Eliminate 22 A330-200/300 to move over to A330-800/900 fleet. Those A330-200/300 which are around 5-8 years old maybe retained for Hajj purpose. Older A330-300 all-Y can be offloaded, either way.
2. Eliminate 6 Boeing 777-300ER - Too heavy, too much capacity, international route is not returning anytime soon. Better swallow the bitter pills now than later. This might lead to losing 5-stars airline status....F class will be out too.
3. Planned disposal of Bombardier CRJ1000 - 18. Done deal.
4. Retire 73 B737NG move over to B737 MAX, some domestic trunk routes to be flown by A330-800/900
5. Move 12 ATR 72 to Citilink.

Wouldn’t surprise me if the Max gets dumped and most of short haul narrow body flying shifted to Citilink (which operates the Neo).

Garuda said they were going to cancel the Max a week or 2 after the grounding started, but never did. Garuda had previously significantly deferred the order which is why they only have one to begin with (deferment was before Lionair crash, it had nothing to do with MCAS or reputation or anything).


I would say yes and no, depends on the circumstances. I don't think Boeing will let GA go off the hook easily for cancelling all of MAX as they with MH (SQ just recently started operating NG and soon MAX) are the only two mainline airlines flying MAX in South East Asia. Boeing will fight tooth and nail to maintain status quo.

After the JT crash, they did threaten to cancel the remaining order, but it was more puff to ally public concern. One month after that threat, they managed to negotiate for order deferment with Boeing. There was news report stating they were offered to upgrade to other Boeing type, but nothing was confirmed (https://asia.nikkei.com/Business/Compan ... ng-planes2). GA current sole MAX was delivered at most difficult circumstance with on-going corruption case and incessant competition from local players. In fact they don't need MAX anyway as their current NG fleet are pretty young (the oldest B737-8U3) being 10 years old only.
 
RoyalBrunei757
Posts: 350
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Tue May 25, 2021 7:36 am

VSMUT wrote:
RoyalBrunei757 wrote:
Simplifying fleet moving forward:
Airbus A330-800 - 4
Airbus A330-900 - 14
Boeing 737 MAX 8 - 50
Total - 68

4. Retire 73 B737NG move over to B737 MAX


They definitely aren't moving to a 737MAX fleet with this move. Maybe in the long term, but this move seems to be more about conserving money, so they won't be adding new aircraft they have to pay for if it can be avoided. And either way, the MAX has yet to be cleared to fly in Indonesia, and may stay grounded there for some time.


chonetsao wrote:
I think the 6 A333 in all economy class configuration will be gone.

Plus I don't think A330-800 is delivered yet. One article in March 2021 suggests there is no firm delivery date for those aircrafts yet. Those can be cancelled too. Thus it is safe to say if Garuda was to reduce fleet, the lone 4 A330-800 order could be in danger to go.

A330-900 will be coming as planned and may replace the 9 remaining A333 on one-to-one basis.


The all-economy A330s could go to Citilink, couldn't they? The A330-800 order was firmed in March, I'd presume they wouldn't have placed it so close to this announcement if they didn't plan to take them.

Yes, for B737 what I meant was it is long term plan to switch to MAX once the market has recovered. They will keep their NG for now since they had reached an agreement with Boeing back in 2019 to defer delivery of remaining MAX.

I am not sure if they all-economy A333 will be going to Citilink (QG) as they are intended for Hajj flight and they are oldest fleet type. Citilink currently has two A330-900neo in their fleet (ex-WOW Air ntu), primarily used on trunk domestic route. They were planning to use it to expand into mid/long haul LCC to Asia and Middle East in 2020 (competing against JT), however it didn't panned out with COVID-19. They might get the younger A330-330 from GA, but no one knows what GA plans for QG.
 
VV
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Tue May 25, 2021 7:38 am

RoyalBrunei757 wrote:
...
Simplifying fleet moving forward:
Airbus A330-800 - 4
Airbus A330-900 - 14
Boeing 737 MAX 8 - 50
Total - 68

The A330-800 order was firmed up only recently (March 2021) with Airbus after the latter disclosing it's name behind the unnamed customer LOI signed back in 2019. GA would have cancelled the LOI if they have not intention to purchase at first place, however as many here would agree, based on current circumstance, things are very fluid. I do see them flying a combination of A330-800/900 to Japan and Australia, in addition to AMS.


It is a very intriguing fleet composition.

What's their strategic plan?
 
VSMUT
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Tue May 25, 2021 8:11 am

RoyalBrunei757 wrote:
I am not sure if they all-economy A333 will be going to Citilink (QG) as they are intended for Hajj flight and they are oldest fleet type. Citilink currently has two A330-900neo in their fleet (ex-WOW Air ntu), primarily used on trunk domestic route. They were planning to use it to expand into mid/long haul LCC to Asia and Middle East in 2020 (competing against JT), however it didn't panned out with COVID-19. They might get the younger A330-330 from GA, but no one knows what GA plans for QG.


The Citilink A330s were also acquired primarily for Hajj, from what I've been told.
 
rayps
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Tue May 25, 2021 8:36 am

I don't think GA will retire its A333. Because of the high cargo demand during the pandemic, GA will most likely convert them (especially the old ones) into freighters just like the other two A333s (PK-GPA, PK-GPD) that were already reconfigured in Feb/March 2021.
 
VMCA787
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Tue May 25, 2021 10:47 am

The real problem they have is cutting the staffing and overhead with the fleet reduction. Sadly, there aren't too many airlines who have shrunk their way to profit.
Fly fast, live slow!
 
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eta unknown
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Tue May 25, 2021 11:28 am

VV wrote:
RoyalBrunei757 wrote:
...
Simplifying fleet moving forward:
Airbus A330-800 - 4
Airbus A330-900 - 14
Boeing 737 MAX 8 - 50
Total - 68

The A330-800 order was firmed up only recently (March 2021) with Airbus after the latter disclosing it's name behind the unnamed customer LOI signed back in 2019. GA would have cancelled the LOI if they have not intention to purchase at first place, however as many here would agree, based on current circumstance, things are very fluid. I do see them flying a combination of A330-800/900 to Japan and Australia, in addition to AMS.


It is a very intriguing fleet composition.

What's their strategic plan?

GA doesn't plan to fail- they continually fail to plan...
 
ASEANFlyer
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Wed May 26, 2021 3:28 pm

I think GA have no choice but to change their business plan. Geographically Indonesia isn't in the best location but still has some opportunities across a few different market segments.

Domestic Indonesia flights
- Only operate to major cities from Jakarta namely BTJ, KNO, YIA, SUB, UPG, BPN, DPS, SRG
- All remaining potential profit-making routes be transferred to Citilink with multiple bases across the country
- On flights from Jakarta which overlap namely Garuda and Citilink both operate Garuda should use CGK and Citilink use HLP on those routes so they do not compete with one another directly.
- GA flights to be operated by A330-200/300 and B737-800

Asia Pacific Flights
- Operate a dual hub with CGK and DPS
- CGK focus on Australia, China (incl. HK), Japan, Korea, Malaysia, Singapore & Thailand with A330-300, A330-800, A330-900
- DPS focus on Australia, China (incl. HK), Japan & Korea with A330-300, A330-900
- Citlink to operate international services in the region from other bases than CGK i.e. KNO, SUB

Saudi Arabia Flights
- Return all leased 777-300ER to lessors and convert the remaining fleet to a more dense configuration a small business class + 3-4-3 in economy and dedicate the aircraft on pilgrimage flights.

Long-haul flights
- AMS 1x daily A330-800 from CGK to be timed with connections to Australia and DPS

Fleet:
- B737-800 (return all leased aircraft)
- A330-200 Domestic flights and phased out
- A330-300 Domestic and APAC from CGK and DPS all to be upgraded with latest cabin
- A330-800 Amsterdam & APAC from CGK
- A330-900 APAC from CGK and DPS -- includes transfer of Citilink A330-900 to Garuda
- B777-300ER Saudi Arabia flights only (return all leased aircraft)

Future orders [if possible to withdraw from B737 MAX 8 order]
- A320neo for Garuda and Citilink
- A321neo for Garuda and Citilink
 
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Devilfish
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Thu May 27, 2021 12:30 am

ASEANFlyer wrote:
Long-haul flights
- AMS 1x daily A330-800 from CGK to be timed with connections to Australia and DPS

GA would be all set for it were they to complete the A338 order given the model's ETOPS 180 rating off the line w/ a 285 min option (handy amid the tensions) and the just announced EASA cert for ICAO CO2 emission standard. The 251t variant would be ideal though for this long-haul sector if that gets certified. But GA must sort through all the mess first.
"Everyone is entitled to my opinion." - Garfield
 
AngMoh
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Thu May 27, 2021 7:35 am

ASEANFlyer wrote:
Long-haul flights
- AMS 1x daily A330-800 from CGK to be timed with connections to Australia and DPS


They should not be timed with Australia connections but with Indonesia domestic connections: Indonesia is big and for a lot of Europeans CGK is just a transfer point. They go to Bali, Lombok, Sulawesi, Maluku islands, Kalimantan and other places including other locations in Java (Bandung, Yogyakarta, Surabaya) and Sumatra. If you take the SQ flight from AMS and look at transfers on arrival in SIN, a lot of transfers are to smaller towns in Indonesia. That said, SQ offers only a fraction of the destinations available compared with GA. For example, if I want to go to Rajah Ampat on a high end vacation, the only option is GA from CGK. Indonesia is a lot more than just Bali. Nobody will fly to Australia on GA because their Australian connections are almost non-existent.
727 732 733 734 735 73G 738 739/ER 742 743 744/M 752 753 762 772 77E 773 77W 788 A300 A310 A319 A320 A321 A332 A333 A343 A345 A346 A359 A35K A388 DC-9 DC-10 MD11 MD81 MD82 MD87 F70 ERJ145 E170 E175 E190 E195 ATR72 Q400 CRJ200 CRJ700 CRJ900 BAE146 RJ85
 
ewt340
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Thu May 27, 2021 7:53 pm

VV wrote:
RoyalBrunei757 wrote:
...
Simplifying fleet moving forward:
Airbus A330-800 - 4
Airbus A330-900 - 14
Boeing 737 MAX 8 - 50
Total - 68

The A330-800 order was firmed up only recently (March 2021) with Airbus after the latter disclosing it's name behind the unnamed customer LOI signed back in 2019. GA would have cancelled the LOI if they have not intention to purchase at first place, however as many here would agree, based on current circumstance, things are very fluid. I do see them flying a combination of A330-800/900 to Japan and Australia, in addition to AMS.


It is a very intriguing fleet composition.

What's their strategic plan?

Indonesia, like many surrounding Asian countries import tons of chinese goods to their country. A330 have always been popular amongst Asian Countries. They usually need the cargo capability
 
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mercure1
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Thu Jun 03, 2021 3:07 pm

Bloomberg reports GA looking to reduce its existing A330/B777 fleet and cancel its A330NEO orders.

https://www.bloomberg.com/news/articles ... ing-planes
mercure f-wtcc
 
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aemoreira1981
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Thu Jun 03, 2021 4:22 pm

GA needs to retire its six A333s at the low MTOW range. The two B735s still on the QG roster should also be permanently decommissioned and scrapped, and the B77Ws are definitely too big for GA...so that's 18 planes off the bat to remove from the fleet. Then the 18 CRJXs are gone too, with only Air Nostrum really interested as an operator of those, and so it would be them or scrap.

Then you have the A330 fleet. If one retires the B77W, then only the A332 is capable of reaching AMS in the GA configuration. Delay any future A339 deliveries (beyond the three additional already built) so that the final eight examples are of the 251t variant, which would be capable of reaching AMS (even the A339 at 242t can't make it to AMS without some restrictions), and then the A332s can leave the fleet, with the A338 canceled. This would give a fleet of 11 A333s and 14 A339s as the medium- and long-haul fleet (eight 233 or 235t A333s, 6 A339s at 242t, and 8 A339s at 251t), and in Europe, only AMS is needed. As others have noted, the AT76s are likely headed to QG, which would cut the fleet by another 7.

On the 737 side, the MAX could be delayed (with the sole one already delivered returned to the Bank of Communications), and the three ex-FR FR B738s could also be returned. This would bring GA down to 95 planes. The rest of the B738 fleet is between 5 and 11 years old---how many would then be needed for that flying programme? Also, here's a conundrum with delaying the MAX: MEL and SYD are within MAX 8 range, but not within 737 NG range, and so GA could want to take some more of those to replace the A330 to MEL and at least to SYD on some days.
 
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LAXintl
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Fri Jun 04, 2021 3:37 am

State-owned enterprises minister Erick Thohir says Garuda (and its subsidiary Citilink) will focus on the domestic market, and not the international market.

Even pre-pandemic 78% of all traffic in Indonesia was domestic and pivoting to capture a larger slice of domestic market better would help ease Garuda’s financial burden.

https://www.ttgasia.com/2021/06/03/indo ... ay-afloat/
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eta unknown
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Fri Jun 04, 2021 6:51 am

When I worked there only 3 international routes were profitable: JKT-SIN, JKT-BKK, JKT-JED. All Chinese, Japanese, Australian routes lost millions. BNE-DPS was cut because of the enormous weight restriction with the GA 737NG version while Virgin & later Malindo could operate without issues in normal weather conditions.
Most domestic routes were profitable.
The ex Ryanair 737NG's are shockers and aren't supposed to operate any flight over 1 hour from JKT.
 
LTEN11
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Fri Jun 04, 2021 10:28 am

eta unknown wrote:
When I worked there only 3 international routes were profitable: JKT-SIN, JKT-BKK, JKT-JED. All Chinese, Japanese, Australian routes lost millions. BNE-DPS was cut because of the enormous weight restriction with the GA 737NG version while Virgin & later Malindo could operate without issues in normal weather conditions.
Most domestic routes were profitable.
The ex Ryanair 737NG's are shockers and aren't supposed to operate any flight over 1 hour from JKT.


GA's flights to Australia may have lost money, but you could guarantee they were worth far more to the Indonesian economy than they were in costs to the GA bottom line.
 
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eta unknown
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Fri Jun 04, 2021 12:40 pm

LTEN11 wrote:
eta unknown wrote:
When I worked there only 3 international routes were profitable: JKT-SIN, JKT-BKK, JKT-JED. All Chinese, Japanese, Australian routes lost millions. BNE-DPS was cut because of the enormous weight restriction with the GA 737NG version while Virgin & later Malindo could operate without issues in normal weather conditions.
Most domestic routes were profitable.
The ex Ryanair 737NG's are shockers and aren't supposed to operate any flight over 1 hour from JKT.


GA's flights to Australia may have lost money, but you could guarantee they were worth far more to the Indonesian economy than they were in costs to the GA bottom line.


In fact that describes the purpose of GA- to bring foreigners to Indo and contribute to the economy. In Australia part of their problem is their "jobs for the boys" cost structure: every station has an expat manager and expat station manager- these can all be done by locals instead.
The most profitable flight was PER-JKT: it was cancelled so many times the operational costs were almost nothing!
 
avier
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Fri Jun 04, 2021 12:49 pm

eta unknown wrote:
The ex Ryanair 737NG's are shockers and aren't supposed to operate any flight over 1 hour from JKT.

What could be the reason for that? Is it capability or something else
 
RoyalBrunei757
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Fri Jun 04, 2021 3:47 pm

avier wrote:
eta unknown wrote:
The ex Ryanair 737NG's are shockers and aren't supposed to operate any flight over 1 hour from JKT.

What could be the reason for that? Is it capability or something else

I think those come with lowest MTOW, may not be ETOPS equipped too.
 
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eta unknown
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Fri Jun 04, 2021 4:53 pm

avier wrote:
eta unknown wrote:
The ex Ryanair 737NG's are shockers and aren't supposed to operate any flight over 1 hour from JKT.

What could be the reason for that? Is it capability or something else


No seat back IFE on board in economy. Also the business class seats are also a little different (same as what were on the 744 aircraft) and not as comfortable as the other 737 seats up front. FYI all the galley equipment says Ryanair too! The interiors are also not in the best condition compared to the other 737's (even without the sky interior).
 
Weatherwatcher1
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Fri Jun 04, 2021 7:30 pm

mercure1 wrote:
Bloomberg reports GA looking to reduce its existing A330/B777 fleet and cancel its A330NEO orders.

https://www.bloomberg.com/news/articles ... ing-planes


That makes sense. If they are trying to shrink, adding more new widebodies won’t help. Garuda can’t afford lease payments on existing planes.

I guess we can probably say goodbye to another A330neo order. The outlook for that plane in Malaysia/Indonesia isn’t looking so great.
 
jbs2886
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Fri Jun 04, 2021 7:36 pm

eta unknown wrote:
avier wrote:
eta unknown wrote:
The ex Ryanair 737NG's are shockers and aren't supposed to operate any flight over 1 hour from JKT.

What could be the reason for that? Is it capability or something else


No seat back IFE on board in economy. Also the business class seats are also a little different (same as what were on the 744 aircraft) and not as comfortable as the other 737 seats up front. FYI all the galley equipment says Ryanair too! The interiors are also not in the best condition compared to the other 737's (even without the sky interior).


How many ex-Ryanair aircraft are there? Per airfleets only 3 8AS aircraft.
 
filipinoavgeek
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Sat Jun 05, 2021 2:01 am

Weatherwatcher1 wrote:
mercure1 wrote:
Bloomberg reports GA looking to reduce its existing A330/B777 fleet and cancel its A330NEO orders.

https://www.bloomberg.com/news/articles ... ing-planes


That makes sense. If they are trying to shrink, adding more new widebodies won’t help. Garuda can’t afford lease payments on existing planes.

I guess we can probably say goodbye to another A330neo order. The outlook for that plane in Malaysia/Indonesia isn’t looking so great.


I wonder what's gonna happen to the A338 if the order is cancelled. Would that mean it could quietly get the axe? And speaking of the A330neo, how likely is it that AAX's A330neo order is really going to be cancelled? Wouldn't that pretty much mean the end of the project then?
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RoyalBrunei757
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Sat Jun 05, 2021 6:47 am

jbs2886 wrote:
eta unknown wrote:
avier wrote:
What could be the reason for that? Is it capability or something else


No seat back IFE on board in economy. Also the business class seats are also a little different (same as what were on the 744 aircraft) and not as comfortable as the other 737 seats up front. FYI all the galley equipment says Ryanair too! The interiors are also not in the best condition compared to the other 737's (even without the sky interior).


How many ex-Ryanair aircraft are there? Per airfleets only 3 8AS aircraft.

Used to be five from Ryanair, now left with three. GA added a lot of non-standard B737-800NG (those without -U3 customer code) in mid 2000s after several incidents with B737 classics, the local government required all operators to swiftly move to newer generation. Thus the 35 non-standard B737NG as they wait for their own B737NG to arrive.
 
RoyalBrunei757
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Sat Jun 05, 2021 6:58 am

filipinoavgeek wrote:
Weatherwatcher1 wrote:
mercure1 wrote:
Bloomberg reports GA looking to reduce its existing A330/B777 fleet and cancel its A330NEO orders.

https://www.bloomberg.com/news/articles ... ing-planes


That makes sense. If they are trying to shrink, adding more new widebodies won’t help. Garuda can’t afford lease payments on existing planes.

I guess we can probably say goodbye to another A330neo order. The outlook for that plane in Malaysia/Indonesia isn’t looking so great.


I wonder what's gonna happen to the A338 if the order is cancelled. Would that mean it could quietly get the axe? And speaking of the A330neo, how likely is it that AAX's A330neo order is really going to be cancelled? Wouldn't that pretty much mean the end of the project then?

No, it is a bit too far fetched to say AirAsia X order cancellation would mean end of A330neo program. There are few orders from other more "solid" customers that Airbus needs to fulfill the order. No one has the answer now to be honest due to current pandemic. A330neo, B787 and A350 program are moving at a slower pace now as airlines are not clamouring over widebody capcity. 2023/2024 would be a safe bet for recovery, by then A339neo would be at full swing again.

Coming back to GA, I hope they can negotiate for a smaller A330neo order and move the balance to pay for their A320neo order. The A339neo order was part of their initial A330-300ceo order cancellation. Cancelling A330neo order would mean they will lose all their deposit altogether.
 
TheEuphorian
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Sat Jun 05, 2021 10:31 am

The all Y A330s (the variant -341), will probably be the first to be gone from the fleet, along with the CRJ-1000
 
filipinoavgeek
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Sat Jun 05, 2021 11:12 am

RoyalBrunei757 wrote:
filipinoavgeek wrote:
Weatherwatcher1 wrote:

That makes sense. If they are trying to shrink, adding more new widebodies won’t help. Garuda can’t afford lease payments on existing planes.

I guess we can probably say goodbye to another A330neo order. The outlook for that plane in Malaysia/Indonesia isn’t looking so great.


I wonder what's gonna happen to the A338 if the order is cancelled. Would that mean it could quietly get the axe? And speaking of the A330neo, how likely is it that AAX's A330neo order is really going to be cancelled? Wouldn't that pretty much mean the end of the project then?

No, it is a bit too far fetched to say AirAsia X order cancellation would mean end of A330neo program. There are few orders from other more "solid" customers that Airbus needs to fulfill the order. No one has the answer now to be honest due to current pandemic. A330neo, B787 and A350 program are moving at a slower pace now as airlines are not clamouring over widebody capcity. 2023/2024 would be a safe bet for recovery, by then A339neo would be at full swing again.

Coming back to GA, I hope they can negotiate for a smaller A330neo order and move the balance to pay for their A320neo order. The A339neo order was part of their initial A330-300ceo order cancellation. Cancelling A330neo order would mean they will lose all their deposit altogether.


What about the A338? What are its prospects if Garuda cancels its order?
RIP 9V-SKA
2007 - 2019
 
RoyalBrunei757
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Sat Jun 05, 2021 2:09 pm

filipinoavgeek wrote:
RoyalBrunei757 wrote:
filipinoavgeek wrote:

I wonder what's gonna happen to the A338 if the order is cancelled. Would that mean it could quietly get the axe? And speaking of the A330neo, how likely is it that AAX's A330neo order is really going to be cancelled? Wouldn't that pretty much mean the end of the project then?

No, it is a bit too far fetched to say AirAsia X order cancellation would mean end of A330neo program. There are few orders from other more "solid" customers that Airbus needs to fulfill the order. No one has the answer now to be honest due to current pandemic. A330neo, B787 and A350 program are moving at a slower pace now as airlines are not clamouring over widebody capcity. 2023/2024 would be a safe bet for recovery, by then A339neo would be at full swing again.

Coming back to GA, I hope they can negotiate for a smaller A330neo order and move the balance to pay for their A320neo order. The A339neo order was part of their initial A330-300ceo order cancellation. Cancelling A330neo order would mean they will lose all their deposit altogether.


What about the A338? What are its prospects if Garuda cancels its order?

It would depends how hard GA can fight with Airbus to get it cancelled. I believe Airbus would not let it go easily. GA will lose deposit, Airbus A338 program will die prematurely, either one or both will be financially hit.
 
ASEANFlyer
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Mon Jun 07, 2021 5:07 am

- It's right that GA should focus on the profitable domestic market routes and even in the domestic market streamline operations to focus on the major city pairs and premium leisure destinations. Also, look at the mix between GA and Citilink and transfer some of the routes and frequency between them.
- The Citilink A330-900neo should transfer over to GA too and for Citilink to keep with the A320neo, ATR's and perhaps order A321neo for more capacity similar to what Lionair has with 737-900ER.
- The international network needs to be looked at as the majority of it is loss-making. For AMS a JV should be looked at with KLM or a code-share with KLM operating the route.
- SIN should be retained with multiple frequencies for the business traveller and premium leisure and healthcare travellers with a product that can compete with SQ.
- BKK perhaps 1-2x daily frequency.
- The key strategic decision for GA and the Indonesian Government will be International routes from DPS, whilst some if not all are loss-making they do add great value to the local economy and tourism. Indonesia is keen to grow its tourism outside of Bali to places like Lombok, Labuan Bajo, Ambon etc. so it may be worthwhile preserving some of the key routes and those with no other competition or operated by fellow Sky Team Partners perhaps retaining MEL, SYD, NRT, KIX and then perhaps re-look at BOM for the Indian tourist growth to Bali where currently no direct flights. However, the frequency will be important and for all these DPS routes need smaller J class cabins with more economy seats.
 
hannah9898
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Mon Jun 07, 2021 5:30 am

aemoreira1981 wrote:
GA needs to retire its six A333s at the low MTOW range. The two B735s still on the QG roster should also be permanently decommissioned and scrapped, and the B77Ws are definitely too big for GA...so that's 18 planes off the bat to remove from the fleet. Then the 18 CRJXs are gone too, with only Air Nostrum really interested as an operator of those, and so it would be them or scrap.

Then you have the A330 fleet. If one retires the B77W, then only the A332 is capable of reaching AMS in the GA configuration. Delay any future A339 deliveries (beyond the three additional already built) so that the final eight examples are of the 251t variant, which would be capable of reaching AMS (even the A339 at 242t can't make it to AMS without some restrictions), and then the A332s can leave the fleet, with the A338 canceled. This would give a fleet of 11 A333s and 14 A339s as the medium- and long-haul fleet (eight 233 or 235t A333s, 6 A339s at 242t, and 8 A339s at 251t), and in Europe, only AMS is needed. As others have noted, the AT76s are likely headed to QG, which would cut the fleet by another 7.

On the 737 side, the MAX could be delayed (with the sole one already delivered returned to the Bank of Communications), and the three ex-FR FR B738s could also be returned. This would bring GA down to 95 planes. The rest of the B738 fleet is between 5 and 11 years old---how many would then be needed for that flying programme? Also, here's a conundrum with delaying the MAX: MEL and SYD are within MAX 8 range, but not within 737 NG range, and so GA could want to take some more of those to replace the A330 to MEL and at least to SYD on some days.

The 77W and the CRK both were the major issues to GA fleet. The airline did not do the homework before ordering the CRK and the 77W when they knew it was unfit or unable to fly longer to Europe at max payload while the CRJ was never fit to land at smaller airports like Ende and Jember. Now GA wants to sell their CRJ's and I blame the ex CEO for this back in 2012.
 
hannah9898
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Mon Jun 07, 2021 5:34 am

ASEANFlyer wrote:
- It's right that GA should focus on the profitable domestic market routes and even in the domestic market streamline operations to focus on the major city pairs and premium leisure destinations. Also, look at the mix between GA and Citilink and transfer some of the routes and frequency between them.
- The Citilink A330-900neo should transfer over to GA too and for Citilink to keep with the A320neo, ATR's and perhaps order A321neo for more capacity similar to what Lionair has with 737-900ER.
- The international network needs to be looked at as the majority of it is loss-making. For AMS a JV should be looked at with KLM or a code-share with KLM operating the route.
- SIN should be retained with multiple frequencies for the business traveller and premium leisure and healthcare travellers with a product that can compete with SQ.
- BKK perhaps 1-2x daily frequency.
- The key strategic decision for GA and the Indonesian Government will be International routes from DPS, whilst some if not all are loss-making they do add great value to the local economy and tourism. Indonesia is keen to grow its tourism outside of Bali to places like Lombok, Labuan Bajo, Ambon etc. so it may be worthwhile preserving some of the key routes and those with no other competition or operated by fellow Sky Team Partners perhaps retaining MEL, SYD, NRT, KIX and then perhaps re-look at BOM for the Indian tourist growth to Bali where currently no direct flights. However, the frequency will be important and for all these DPS routes need smaller J class cabins with more economy seats.

GA should end flight to Europe and JV with KLM instead. Focus on flights around Asia and Australia first and operate key domestic routes.Unfortunetely, GA has already terminate their so-called First Class and the way to restructure more is to do this for example:

- Remove IFE on B737's fleet and increase to 174 seat fully.

- Convert 777's to 10 abreast

- Buy On Board on many Domestic Flights could be the next option since I think just like how LH does lately on Short-Haul flights.

Etc

How's that plan?
 
ASEANFlyer
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Mon Jun 07, 2021 7:56 am

Agree it was the right decision to terminate their First class product. It was a great product but on so few aircraft just was not practical.

Garuda needs to remain as a premium carrier but with efficiencies to be made behind the scenes, fewer aircraft, fewer types, and product consistency across the fleet, currently, on the A330 fleet there are 3 different types of business class for example.

The idea of buy on board won't work for Garuda as with other legacy carriers in the region. Consumers in ASEAN either want something which is very affordable or something premium. There isn't really anything in the middle. In fact, in their premium cabins, they need to return to the Pre-Covid service levels with the A330 in a 1-2-1 configuration.

The leased 777's should be returned to lessors and the remaining fleet should go 10 abreast in economy with a small business class and should only be used in Saudi Arabia services.

International flights from Jakarta: BKK, JED, KUL, MED, MEL, KIX, PER, PVG, SIN, SYD. Flights to AMS partnership with KL, HND partnership with NH or JL, ICN partnership with KE

International flights from Denpasar: MEL, KIX, SYD, HND. ICN, PEK, PVG, TPE can be operated by Sky Team Partners.

The focus should remain on domestic operations and working with Citilink to ensure either is not cannibalizing each other's business.
 
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eta unknown
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Mon Jun 07, 2021 9:46 am

1. You can't introduce buy on board with GA- you then cannibalize your Citilink traffic.
2. First class existed purely to achieve Skytrax 5 star status- I think present management agrees it's no longer worth the cost to maintain it.
3. Converting the 777's to 3-4-3 is a good idea, but it costs several million to do so- is it worth it?
4. AMS will always be kept no matter how many million it loses every month.
5. Citilink longhaul Europe plans (FRA) should be scrapped- the A330 can be sent to Jeddah or Medina for Umrah/Haj traffic.
 
HB-IWC
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Mon Jun 07, 2021 10:39 am

ASEANFlyer wrote:
International flights from Jakarta: BKK, JED, KUL, MED, MEL, KIX, PER, PVG, SIN, SYD. Flights to AMS partnership with KL, HND partnership with NH or JL, ICN partnership with KE


With HND and ICN you would be taking away some of the few somewhat profitable services from Jakarta. There is room for both KE and GA on the ICN route and there is definitely room for a profitable Garuda operation to Tokyo. That is probably not the case for Osaka.
 
FromCDGtoSYD
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Mon Jun 07, 2021 10:57 am

Having only been on the SIN-AMS portion of the CGK-AMS route, what is the purpose of the route? I know colonial ties and all but what remains of those ties now? Are the Dutch investing a lot in the country? Or does the political elite love going to NL?

Garuda owns Citilink and Sriwijaya, theres ample opportunity to use those for the low cost traffic. If even Malindo gets away with a premium cabin than GA should have a premium market for itself especially in such a populous country.

I've been on flights to HKG a few times and I've always been in empty J cabins, I don't know if it's a question of pricing or timing but filling J is essential for all full service airlines to survive. They also need to change their cabins, the last few 330-200 with the reverse herringbone seats are great but much of the fleet still features angled seats.

Full Y flights should probably go to citilink, the cost basis for GA simply doesn't justify it.

And simplifying the fleet will go a long way, A330 or 787 for longer routes, A320/737 for the rest... the region doesn't have many smaller jets zipping so purchasing anything of this size will have the same result as the CRJ...
 
RoyalBrunei757
Posts: 350
Joined: Mon Apr 12, 2021 6:18 am

Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Mon Jun 07, 2021 11:36 am

Seems like the aircraft offloading has started, GA has returned two B737-8U3 to Pembroke.

https://www.reuters.com/business/aerosp ... 021-06-07/

PK-GMZ Boeing 737-8U3(WL) 7.8 years old Stored at KUL 20 May 2021 re-registered as VQ-BXZ
PK-GMS Boeing 737-8U3(WL) 9.6 years old Stored at KUL 6 June 2021 re-registered as VQ-???

There is a photo floating on Facebook for PK-GMZ being re-registered. I am afraid I am unable to share here. PK-GMZ was recently painted in "72nd Anniversary (1949-2021)" special colours

 
filipinoavgeek
Posts: 662
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Re: Garuda Plans Major Restructuring That May Halve Its Fleet

Mon Jun 07, 2021 11:42 am

FromCDGtoSYD wrote:
Garuda owns Sriwijaya

Their partnership with Sriwijaya ended a while back over safety concerns, though I can't remember if it was before or after the crash.
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