Garuda Indonesia

STATEMENT OF THE FACTS

Is the flag carrier of Indonesia. Named after the holy bird Garuda of Hinduism
and Buddhism,also after the national emblem of Indonesia, the airline is
headquartered at Soekarno-Hatta International Airport in Tangerang, near Jakarta.
Garuda Indonesia in its current institutional form had its beginnings in the
Indonesian war of independence against the Dutch in the late 1940s, when Garuda
flew special transports with a Douglas DC-3. January 26, 1949 is generally
recognized as the airline's founding date, at which time the airline was known as
"Garuda Indonesian Airways." The first aircraft was a DC-3 known as Seulawah and
was purchased for a sum of 120,000 Malayan dollars, which was provided by the
people of Aceh (notably local merchants). During the revolution, the airline
supported Indonesian interests, such as carrying Indonesian leaders for diplomatic
missions.
The Burmese government helped the airline significantly during its
beginnings. The country's national airline, Union of Burma Airways, often chartered
this DC-3 for its own flights. Accordingly, upon Garuda's formal joint incorporation
with KLM on 31 March 1950, the airline presented the Burmese government with a
DC-3. By 1953, the airline had 46 aircraft,although by 1955 its Catalina fleet had
been retired. Fourteen De Havilland Heron aircraft were acquired to serve shorter
range routes. In June 1956, Garuda made its first Hajj flight, operated with a Convair
340 carrying 40 Indonesians, to the city of Mecca.
The 1960s was a time of growth for the airline; the fleet in 1960 included
eight Convair 240s, eight Convair 340s and eight Convair 440s. In 1961 three
Lockheed L-188 Electras four-engined turboprop airliners were acquired, and in late
1965, three Convair 990 Coronado four-engined jet aircraft were introduced and the
airline began flights to Kai Tak International Airport in Hong Kong.
However, since the government introduction of an open domestic airline
industry in 1990, Garuda Indonesia started to face difficulties. Garuda competed
against a number of private airlines, which possessed expansive strategies in
developing routes as well as increasing the number of aircraft. The performance of
Garuda Indonesia gradually decreased to a low when operational profit and cash
flow reached negative figures during the period 1993 to 1997. Further, the seat load
factor and on time performance were also worsening.
On January 6, 1988, Mr. Mohammad Soeparno was appointed by the
government of Indonesia to succeed Mr. Lumenta as President Director of Garuda
Indonesia Airways. Mr. Soeparno is caught in the middle of a dilemma of whether to

continue Mr. Lumentas successful policies or to formulate a new set of policies

which would enhance the companys ability to deal with the challenges it may face
during his term and beyond.