The fortunes of PT Dirgantara, the Indonesian state-owned aerospace firm, have taken another tumble with the company appealing against a bankruptcy order. The company, also known as Indonesian Aerospace, was taken to court by 6,500 ex-employees who were laid off in 2003 as part of a restructuring process. They want the company to be declared bankrupt, claiming that it still owes 200 billion rupiah ($21.8 million) in pension funds and retirement allowances.
Indonesia's commercial court ruled the company has large debts and is on the verge of collapse, and bankruptcy was its only option. IAe and the government, however, are disputing this and appealing to the country's Supreme Court. They say that the company has millions of dollars worth of assets and contracts valued at $300 million for the next 10 years. The government also says that the courts do not have the power to declare state-owned enterprises bankrupt.
The Bandung-based company expects the appeal to be heard within the next six weeks and is confident that the decision would be overturned, says a company official. "This ruling will not have an impact on us and we are confident that the Supreme Court will dismiss it. We are still a viable company," he adds.
The company was formed in 1976 by then research and technology minister B J Habibie, who became Indonesia's third president in 1998. At its peak, it employed 16,000 people and planning to indigenously develop and manufacture a 70-seat aircraft. Its fortunes took a turn for the worse after the 1997 Asian economic crisis, forcing the company to abandon its plan and close several assembly lines.
It now employs about 2,000 people after several restructuring programmes. As part of a 2003 plan, it said that it hopes to manufacture 19-seat passenger aircraft and light civilian helicopters in a bid to boost revenues. It produces components for Airbus and Boeing commercial aircraft, and licence-produces the CN-235 and C-212-200 with EADS Casa, the Eurocopter BO105 and NAS332, and the Bell 412. It is also working with CASA to shift C-212-400 assembly line from Spain to IAe's Bandung facility.
Last year, the government said that it would require the Indonesian armed forces to buy indigenously manufactured products from IAe if they are available. The company, which also provides maintenance services to domestic airlines and the Indonesian air force, has received a vote of confidence from the service following the court order. The air force has said that it still plans to buy 16 Super Puma NAS332 helicopters and three CN-235s with maritime patrol configuration from the company, and adds that it expects the ruling to be overturned.
Source: Flight International
