Garuda raises tariff by 5 percent

Garuda raises tariff by 5 percent

National flag carrier PT Garuda Indonesia Tbk has increased its ticket tariff by 5 percent on average to deal with the impacts of the weakening rupiah exchange rate that once dropped to Rp 11,700 (S$240)  per US dollar.

"Since Aug.1, 2013, we have increased the price of flights. This is part of our effort to minimize any impact of the falling rupiah exchange rate that continues to occur," said Garuda president director Emirsyah Satar in Jakarta on Tuesday, as quoted by Antara news agency.

According to Emirsyah, the falling of the rupiah exchange rate has become the concern of all companies, including Garuda, in which they are looking for ways to anticipate its impacts on the companies' operations.

"We will continue to review the US dollar rate from time to time and follow up the developments by taking strategic measures," he went on.

Emirsyah further explained that if the rupiah exchange rate stood at the range of Rp 11,000 - Rp 11,500 per US dollar, it would not affect the company's business activities too much.

"What will become a problem is, if the exchange rate fluctuates in a wide range," he said.

According to Emirsyah, the strengthening of the US dollar will affect cost components such as fuel purchasing, aircraft rental costs and maintenance costs in which all of the expenses must be paid in the US dollar.

Apart from increasing the airfares, Garuda also carries out several other efficiency measures such as increasing the use of its aircrafts and reducing operational costs at the office.

"With such measures, Garuda's operational and business expansion will run in line with the company's business plan," said Emirsyah.

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