Indonesian Airlines Told to Merge

Indonesian airlines told to merge

JAKARTA, May 5 (Xinhua) — The Indonesian government has urged airlines to either merge or form an alliance as it plans to issue a new regulation that requires each carrier to operate at least five airplanes, local press said Monday.

Of the five planes, the airline must fully own at least three, while it may lease the two others, reported lading economic daily Bisnis Indonesia.

Previously, local airlines can obtain the government license with just three airplanes.

Transportation Minister Jusman Syafii Djamal urged carriers which operate less than 10 planes in their fleets to merge in order to strengthen capital base and make the business more feasible amid the surging global oil prices.

“Alliance or merger will increase the number of aircraft to a level that is economical,” he was quoted as saying.

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