GARUDA INDONESIA is going to turn many of its operations into financially independent business units from 1996, in preparation for the national carrier's eventual privatisation.
The state-owned airline has targeted the Garuda Maintenance Facility (GMF) and ground handling as the first two divisions to be given the new status. Restructuring was supposed to start in 1995, but changes in senior management pushed this back to 1996.
As strategic business units, GMF and ground handling will remain wholly owned subsidiaries of Garuda, but will effectively be operated as separate companies, responsible for generating income and managing budgets.
GMF, with a 3,200-strong workforce and a $30 million turnover, is well prepared for the change. It has three multi-bay hangers, avionics and component workshops and a 450kN (100,000lb)-thrust-capacity engine test-cell.
The centre is certified for all types of heavy maintenance, including Boeing 747-200 D-checks, Section 41 and pylon modifications. In addition to maintaining Garuda's fleet of 55 aircraft, GMF performs third-party work for all six of Indonesia's domestic operators and for international carriers.
It is intended to extend the independence process to Garuda's training division later in the year. The new business unit will have full financial responsibility for the airline's five full-flight simulators, together with new McDonnell Douglas MD-11 and Boeing 737-400 simulators due to be added in 1996.
Other airline operations to be restructured along similar lines include information services, the Kemayoran medical centre and the cargo-handing terminal. The Government is also planning to separate Garuda from domestic carrier Merpati Nusantara from mid-1996, with privatisation planned tentatively for the following year.
Source: Flight International
