Garuda Indonesia management have slashed a large number of unprofitable international and domestic routes in a bid to stem heavy losses from it’s day to day operations.
In all, 97 of 237 routes have been dropped, including international flights to Amsterdam, London and Nagoya. Domestically, a number of services have been cut to one flight per day.
Before the covid pandemic, Garuda operated over 100 international and domestic routes, while subsidiary Citilink handled the bulk of domestic flights. Garuda now operates 61 routes, only 11 of which are international. Citilink continues to handle the bulk of domestic services.
As well as being severely impacted by the global pandemic, Garuda has for many years been beset by issues and allegations ranging from mismanagement to corruption. Corrupt practices are said to include bribery, money laundering and misappropriation of funds by senior management.
Presently Garuda has negative equity of US$2.8 billion and the debt burden is said to be increasing by up to US$150 million per month.
Although the Indonesian Government is one of the company’s major shareholders, it appears unlikely, given the range and nature of problems, that it will come to the aid of the beleaguered airline.