Indonesia to Merge Pelita Air into Garuda Indonesia to Strengthen Aviation Industry

Indonesia is moving to consolidate its state-owned airlines, with Danantara and BP BUMN spearheading a plan to merge Pelita Air into Garuda Indonesia. This strategic move aims to bolster the national aviation industry and enhance its competitive edge in the regional market.

"Garuda Indonesia will eventually become our airline holding company. Pelita Air will become part of Garuda Indonesia," stated Dony Oskaria, Head of BP BUMN and COO of Danantara. Oskaria believes this consolidation will significantly strengthen the group's ability to compete and capture market share. He emphasized that the aviation industry demands meticulous management and swift decision-making, as profitability can be determined minute by minute once a flight departs.

Beyond corporate structure, efforts are underway to elevate Garuda Group's service standards comprehensively. This includes integrating ticketing systems, enhancing lounge quality, improving in-flight experiences, standardizing cabin crew service, upgrading catering, strengthening customer loyalty programs, and developing human resources. The goal is for Garuda Group to become the preferred airline for Indonesians and a major regional player.

This initiative aligns with President Prabowo Subianto's broader plan to streamline state-owned enterprises. He announced that consolidating 250 SOEs by July 31, 2026, is projected to save Rp 50 trillion in overhead costs. The President aims to reduce the total number of SOEs from 1,077 to a maximum of 350 by the end of 2026, potentially saving up to Rp 70-80 trillion annually. Prabowo views Danantara's commitment to this consolidation as a significant achievement for his administration.