Garuda Indonesia to Optimize Route Network Amid Business Transformation

Strategic Restructuring to Enhance Operational Efficiency

PT Garuda Indonesia (Persero) Tbk (GIAA) is set to undertake a comprehensive review of its route network to prevent cannibalization between its full-service carrier and low-cost subsidiary Citilink. This strategic move is part of the airline group's broader business transformation initiative aimed at enhancing operational efficiency and optimizing business performance.

Key Objectives of Route Restructuring

The primary goal of this restructuring is to clearly define and differentiate the service portfolios between Garuda Indonesia and Citilink. According to Thomas Sugiarto Oentoro, Garuda's Deputy CEO, the airline will re-evaluate its route portfolio to ensure that both Garuda and Citilink can operate effectively without competing against each other.

Business Transformation Context

This route restructuring forms a crucial part of Garuda's overall business transformation strategy. The airline is focusing on optimizing its business operations through various measures, including network planning, service differentiation, and capacity management. The restructuring aims to create a more sustainable and competitive business model for both Garuda and Citilink.

Market Implications

The decision is expected to have significant implications for Garuda's market positioning and competitive strategy. By clearly delineating the operational territories of its full-service and low-cost carriers, Garuda aims to enhance its overall market presence and improve customer satisfaction through more targeted service offerings.