Sriwijaya Air bought old planes at low prices and focus on unpopular routes

Report  by : Gan Yung Chyan, KUCINTA SETIA

According to a Reuters report on 12 January 2021, Sriwijaya Air mainly operates domestic routes and a small number of international routes from Jakarta. In 2003, the airline started with a plane and launched a direct route between Jakarta and Pangkal Pinang, As of the time of the air crash, Sriwijaya Air is the country’s third largest airline after Lion Air and Garuda Indonesia.

According to the report, the success of Sriwijaya Air is attributable to its business strategy of buying old aircraft at low prices and focusing on providing services to routes neglected by competitors. For example, the plane that crashed on 9 January flew on a test flight in May 1994. It was 26 years old and is part of the fleet of Sriwijaya Air for 8 years.

According to data from the aeronautical information website Planespotters.net, the average fleet age of Sriwijaya Air and its subsidiary NAM Air aircraft is close to 20 years old, which is nearly three times higher than that of Lion Air.

However Reuters also pointed out that if properly maintained, old aircraft can operate as safely as new ones. However, the cost of doing so is higher, and because of lower fuel efficiency, operating costs are also higher. The report quoted an anonymous industry insider as saying that Sriwijaya Air's business model is reasonable.