Batik Air flight makes emergency landing in Indonesia, no bomb found

An Indonesian Batik Air flight with 122 people on board made an emergency landing in Makassar in South Sulawesi after a suspected bomb threat, a government official said on Friday.

No bomb was found on the plane.

"I got a call from Sultan Hasanuddin airport in Makassar giving information about a bomb on Batik Air flight flying from Ambon to Jakarta," said J.A. Barata, spokesman for the transport ministry.

"Details on how they found out is unclear yet, I'm still waiting for information. The police is in charge of that now."

The plane was isolated from other flights and airport operations were not affected, said Tommy Soetomo, chief executive of airport operator Ankasara Pura I.

Batik Air is a subsidiary of Indonesian budget carrier Lion Air.

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Lion Air reportedly in talks to buy Qantas stake in Jetstar

Indonesian carrier Lion Air is reportedly in talks with Australia’s Qantas Airways to buy its stake in Singapore-based budget airline Jetstar Asia.

Reuters reported on Monday that the talks to acquire Qantas’ 49 per cent stake in Jetstar are still at an early stage, citing an unidentified person familiar with the matter.

The source also said any purchase would have to be approved by Singapore regulators. It is not known how much the potential deal would be worth.

According to Reuters, a Qantas spokesperson called the matter “speculation”, while Jetstar and Lion Air declined to comment.

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Indonesia's Batik Air to launch international service

An airline owned by Indonesia's Lion Group announced on Thursday it will launch international services with a flight from Jakarta to Singapore later this year.

Batik Air, which is part of the Lion Group that also owns Indonesian budget carrier Lion Air, will start the flights by November or December, said its chief executive Achmad Luthfie.

The airline, which operates as a full-service carrier with meals and drinks and offers business and economy class seating, began operations in May last year servicing domestic destinations in Indonesia.

"Our first international destination will be Singapore and we aim to have more than a daily service on the route," Luthfie said in a statement.

"We chose Singapore as our first international destination because we can see that demand continues to increase," he added.

Speaking at a news conference in Singapore, Luthfie said Batik Air plans to fly next from the Indonesian capital to Kuala Lumpur in Malaysia.

Luthfie said that eventually it is looking to fly to Southern China and Western Australia.

On the domestic front, the airline plans to more than double its network to 22 destinations including Palembang, Solo and Batam.

Luthfie said the carrier is currently filling 90 percent of seats.

Batik Air operates six Boeing 737-900ER aircrafts and is based in Jakarta's Soekarno-Hatta airport.

Six Airbus A320 aircraft and four Boeing 737-800 planes will be delivered by the end of this year, the airline said.

Indonesia, a sprawling archipelago of over 17,000 islands cutting across three time zones, relies heavily on air transport and is experiencing a sharp growth in its aviation sector, thanks to a rapidly rising middle class.

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Indonesia's Lion Group eyes Bombardier order

The parent company of Indonesia's Lion Air said on Wednesday it hopes to strike a deal for at least 50 Bombardier passenger jets next year, a purchase with a list price of more than $3 billion.

It would be the latest huge bet on Indonesia's booming aviation sector by Lion Group, which has in recent years struck two of the world's largest plane orders, worth $46 billion.

The company was hoping to complete the deal with Canadian manufacturer Bombardier for at least 50 new medium-range CS300 aircraft early next year, said Leithen Francis, head of public relations at Lion Group.

"We are talking to Bombardier, we are considering the CS300, we do hope that negotiations do progress to where we can come to a decision by the first quarter," he told AFP.

"We would expect the deliveries of the aircraft to start in 2016."

He said the company was still deciding whether the planes would be allocated to its budget carrier Lion Air or its full-service airline Batik Air.

He would not put any potential price on the deal, but Dow Jones Newswires said each plane had a list price of $72 million.

That would make a deal for 50 of the planes worth $3.6 billion, although customers making big orders typically receive large discounts.

The new CS300, which is scheduled to start deliveries at the end of 2014, and its smaller sibling the CS100, is Bombardier's attempt to compete with smaller planes produced by Airbus and Boeing.

Lion Air was a little-known carrier until the two huge orders of recent years -- a $23.8 billion deal with European aerospace giant Airbus in March this year, and a $22.4 billion deal with Boeing in 2011.

However, experts have expressed fears that Lion Air's rapid expansion could compromise safety and there may not be enough trained pilots to keep up with growing demand.

Such concerns were only heightened in April when a Lion Air plane carrying 108 people went into the sea and split in two as it came in to land on the resort island of Bali.

Dozens of people were injured in the accident but there were no fatalities.

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Competition among budget airlines heats up

Southeast Asian low-cost airlines are looking at new ways to out-do one another.

In a market driven by rising wealth, it seems size does matter, so too does keeping faith with customers, as Singapore Airlines' budget offshoot Scoot has learned in its first year of operation.

Long-haul low-cost carrier Scoot is adding another destination to its small but growing fleet. Its inaugural flight to Seoul commences 12 June.

Scoot’s CEO Campbell Wilson said: “Our fifth aircraft does not operate between 11pm and 4am, which therefore provides some backup for when our key departures to Australia, Taipei and Japan and most of the China flights depart. So when you grow a little larger, you have a little bit more bandwidth to be able to counter the inevitable issues that crop up.”

Scoot has had to counter setbacks in its early days, but it said it has done what it can recapture passenger confidence.

Mr Wilson said: “We've certainly listened to the feedback that we've received in the early months of selling tickets.”

Shashank Nigam, CEO of SimpliFlying, said: “I believe their China focus has really paid off well, launching secondary Chinese cities that SIA doesnt fly to… for example, Nanjing.”

By 2015, Scoot will be the first low-cost carrier in ASEAN to operate the Boeing 787 Dreamliner aircraft, which will help the airline reduce costs.

But in the highly-competitive environment, analysts said low-cost carriers like Scoot and Tiger Airways could look to establish more partnerships with other airlines in order to grow their network.

Mr Nigam said: "Tiger needs to work closer with regional partners like Mandela and SeaAir in the Philippines which have been highly unprofitable of late. I think if they can leverage that better, it will help the group overall. For Tiger, I think the key is beating the trend of commoditisation. Everyone can fly now. Everyone can fly cheaply. You want to go beyond price as the product. "

Indonesia's biggest budget carrier Lion Air has an outstanding US$24-billion order for Airbus and also launched Malindo Airways in Malaysia to capture a share of the market from its competitor AirAsia.

AirAsia X, AirAsia's long-haul low-cost arm, is setting up its second hub in Bangkok.

Paul Ng, head of Aviation at SH Legal, said: "They have a huge fleet. And they have huge delivery orders. So they have economies of scale, which Scoot does not have. Each of these carriers has hinterlands to rely on. Lion Air (has) Indonesia, the world's largest archipelago, and AirAsia, Malaysia, which is the second largest, highest GDP country outside Singapore. These two are very rich sources of revenue.

“For Scoot itself, which is in Singapore, with very high passenger traffic, it's ultimately dependent on international trade lines and on how many trade routes that it can secure from governments to do its business. Lion Air and AirAsia can fly domestically with very few restrictions, subject to there being available slots in the airports that they want to fly into.”

Besides injecting more aircraft to boost yields, experts said budget airlines would also do well to boost ancilliary services, which make up almost 40 per cent of their income.

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Things are heating up. The low cost carriers are finding ways to out perform each other and gain a bigger market share. In order to stand out from the rest, the airline must prove itself to be different, in a good way. Easier said than done when this has to be done while keeping to the low cost model.

Indonesia says poor training caused Bali sea crash

Indonesian authorities blamed poor training for a crash in which a rookie pilot undershot the runway and landed in the sea off the resort island of Bali last month, according to a report seen Wednesday.

All 108 passengers and crew survived the spectacular April 13 crash, which split the new Boeing 737-800 in two and was a major blow to Lion Air, which has signed record plane orders but is trying to shake off its poor safety record.

The preliminary investigation by the National Transport Safety Committee found the 24-year-old Indian national at the plane's helm was forced to hand control to the Indonesian captain since he could not see the runway upon descent.

The switch was made at 150 feet (46 metres) - below the minimum altitude considered safe to continue descending - and the captain ordered the plane to go around just one second before it crashed into the sea.

The report recommended Lion Air immediately implement several safety measures, such as reviewing "the policy and procedures regarding the risk associated with changeover of control at critical altitudes or critical time".

The airline should also reiterate safety protocols related to minimum altitudes to its pilots, it said.

The report described a sudden change in weather, with clear visibility minutes before the flight landed changing to rain and very poor visibility seconds before.

While a full investigation will determine the exact cause, the preliminary report ruled out any fault with the aircraft.

Lion Air was little-known internationally until it struck two of the world's largest aircraft orders worth a staggering US$46 billion.

In March Lion Air ordered 234 medium-haul A320 jets worth $18.4 billion euros (US$24.2 billion) from Europe's Airbus to boost its expansion as air travel booms in the fast-developing nation of 240 million.

That order followed its US$22.4 billion order for 230 Boeing 737 airliners in 2011.

But experts have raised concerns there is a lack of qualified pilots in Indonesia to fly the fast-increasing number of planes acquired by Lion Air.

Along with with most Indonesian airlines, it is banned from US and European skies for safety reasons.

Between 2004 and 2006 Lion Air suffered a series of six accidents which all involved planes overshooting or missing the runway. No one died.

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Making the switch at 150 feet is definitely too low for the captain to salvage anything. The call to make a go-around is too late by then. Indeed the first officer should have done better and improved training standards will be needed to prevent such a thing from happening again.

Lion Air passenger plane crashes off coast of Bali

A passenger plane carrying more than 100 people has crashed into the ocean off the coast of Bali.

It is believed the plane slid off the runway at Ngurah Rai Airport, near Denpasar, where it was scheduled to land late this afternoon before landing in water.

Reports from Indonesia indicate the passengers have survived the crash and been relocated to a nearby hospital.

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UPDATE: The Boeing jet carrying more than 100 passengers missed the runway as it came in to land in good weather conditions at Denpasar airport on the Indonesian resort island, transportation ministry official Herry Bhakti told AFP.

Mr Bhakti initially said the plane overshot the runway, but later clarified his comments to say that it landed straight in the water.   

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Oh my god, it must have been quite a traumatic experience for the passengers, especially those near the tail end of the aircraft as we can see a huge crack damage in that area.

Low-cost carriers to continue to drive growth in aviation industry

Low-cost carriers are driving growth in the aviation industry this year, accounting for a billion-dollar increase in the profits forecast for airlines in 2012.

And Singapore Airlines (SIA) has latched on to the trend with its newly-minted low-cost carrier Scoot, in a bid to remain competitive.

Low-cost carriers have continued to enjoy healthy profits, with the number of economy passengers more than doubling that of premium travellers, according to the International Air Transport Association.

Besides Jetstar and AirAsia, SIA's Scoot started operations this year, with Cebu Pacific joining the ranks next year.

Siva Govindasamy, Asia managing editor of Flightglobal, said: "From virtually nothing four years ago, we will have four Southeast Asian long-haul low-cost carriers next year, and you are still in a market segment that is unproven.

"People do not know how much money you can make in this market segment. AirAsia X is likely to have its IPO (initial public offering) next year, and we will see how the market reacts to that long-haul low-cost business model."

Asia Pacific carriers account for more than half of the profits in the aviation industry this year, and low-cost carriers currently take up about 18 per cent of the market in Asia Pacific, compared to 24 per cent globally.

Some airlines are expecting deliveries of more aircraft in 2013, with the likes of LionAir and AirAsia both adding more than 30 new planes to their current fleet. And experts have said this could lead to a price war in Indonesia and Malaysia, which could result in consolidation for smaller players.

But full service carriers aren't resting on their laurels either. Besides ordering new aircraft, SIA is also spending S$95 million to upgrade existing cabins.

But Singapore's national carrier is also repositioning its focus from the premium to value segments.

Subhranshu Sekhar Das, director (aerospace & defense practice) at Frost & Sullivan, said: "The only way to survive in this market is to consolidate and position their strengths.

"We have been seeing multiple carriers creating multiple brands under one umbrella, either SIA creating SilkAir, Scoot; Thai Air with Thai Smile and their partnership with other low-cost carriers; MAS with MASwings, Firefly..."

Besides multiple offshoots, SIA is also starting to get embroiled in a competition in Australia. SIA recently bought a 10 per cent stake in Virgin Australia and sold off its loss-making unit in Tiger Australia.

This came after a recent tie-up between Qantas and Emirates. But Qantas Airways looks set to defend its turf.

Leithen Francis, editor of Aviation Week, said: "Qantas is going to be focusing on the domestic market. I think Alan Joyce's point of view is to invest in those bits of the business that are profitable.

"Their international long-haul business is not profitable but what is very profitable is their domestic 737 operation, and also their regional turbo prop and regional jet operation. So I can see them investing more in new equipment for their operations in Australia."

But with the recent fall of India's Kingfisher Airlines, some analysts also predict that competition might soon move to India's aviation market instead.

Mr Francis said Etihad is in active negotiations to take a stake in Jet Airways and India is a very important market for Middle Eastern carriers.

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Premium airlines no longer have the cutting edge? One thing for sure is the emergence of these low-cost carriers have battered on the profits of the big boys so much so that they're creating their own brand of low-cost carriers to complement their routes on the premium side of business. 

The tide has changed, the future belongs to the low cost carriers as they're virtually recession-proof.

Lion Air Considers Airbus Jets as It Looks to Expand Its Fleet

PT Lion Mentari Airlines said it is talking to Airbus SAS and Boeing Co. (BA) about a purchase of additional single-aisle planes beyond its order for 230 Boeing 737s last year.

“We are studying every possibility to fulfill our target for the planes from every manufacturer, including with Airbus,” PT Lion Air Commercial Director Edward Sirait said in a telephone interview. “So far we haven’t concluded which manufacturer, types and number of planes to buy. But all are possible.”

The Indonesian carrier needs more aircraft as it adds flights in a region where air travel is expected to grow more than 6.4 percent annually through 2031. Lion Air already flies to more than 36 destinations within Indonesia and overseas, and announced plans to establish a low-cost carrier in Malaysia to challenge AirAsia Bhd. (AIRA) in its home market.

Airbus spokesman Stefan Schaffrath said the Toulouse-based manufacturer doesn’t comment on talks with customers or potential customers.

The low-cost carrier, called Malindo Airways, will begin flights in May and may have about 100 planes within a decade, one of its shareholders said in September. Malindo Air will draw its fleet from planes Lion Air has ordered.

The record order for 230 additional 737s in February was worth $22.4 billion at list prices. The deal, which also included 150 options, was Boeing’s biggest in dollar value and plane numbers.

Lion Air didn’t say if it’s considering the Airbus A320neo, which will have more-efficient engines than the existing A320 and enter into service from late 2015. Airbus is still seeking customers to fill A320 delivery slots in 2015.

Airbus has generally lagged behind Boeing in Indonesia, one of the more promising markets for air traffic growth in coming decades. Lion Air itself has forecast passenger growth rates of 15 percent a year. The airline said last year that the parent company fleet may expand to 470 planes by 2025 from about 100.

Airbus is also looking to sell A380 superjumbos to flagship airline Garuda Indonesia. (GIAA) The airline said Nov. 21 it had received proposals from Airbus as well as from Boeing for its 747 Intercontinental. President Director Emirsyah Satar said the review of proposals was still at an early stage.

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Just when you thought they will not be ordering new planes for a very long time, Lion Air is now mulling on whether to try Airbus' A320neo. However when you consider Indonesia's aviation industry growth of 6.4% per year, the huge orders don't seem to be as crazy, even so when Lion Air's orders has to feed Malindo Airways too.

Malindo and Lion to absorb 600 unemployed pilots, hire up to 1,200 in five years

Finally some good news to a growing number of unemployed pilots. Malindo Air and Lion Air will hire more than 600 pilots from Malaysia for its operations over the next few months to years while its rivals are only hiring between 50 and 100 a year.

That's not all. According to PT Lion Grup president director Rusdi Kirana, the group has the capacity to absorb many more pilots and it can even hire up to 1,000 over the next five years.

“With all the aircraft orders that we have made, we certainly need pilots. It is not empty promises, it is real. We need pilots but it also depends on the pilots. They must have good skills, knowledge and the right attitude (before we can hire them),” he says in an interview with StarBizWeek.

He adds that “we are growing and we have placed an order for 381 new aircraft and that means we need pilots. And we are also thinking of ordering more aircraft.”

The airline group was in the limelight in February when it firmed an order to buy 230 aircraft worth US$22bil from Boeing and that purchase was said to be the single largest contract in commercial aviation history. It is because of that order, many within the aviation industry began looking at Lion Air seriously.

The PT Lion Grup owns Lion Air, Wings Air and Batik Air (to be launched in the second half of 2013) and has a 49% stake in Malaysia's Malindo Air.

“In a year, we will take delivery of 36 to 40 aircraft and for each aircraft we need five sets of pilots or 10 people. So we need to hire about 200 pilots each year and over five years we will need 1,000 pilots.

“On top of that, there will also be pilots who fall sick or go on leave, so we need 20% more. So in total, we can take up to 1,200 pilots over the five years, but it all depends on skills, knowledge and attitude,” Rusdi says.

There are over 1,000 unemployed pilots in the country who can't seem to pin down jobs because there is a limited number of vacancies and they cannot market themselves globally because they have too few flying hours.

But the emergence of Malindo Air has presented an opportunity for the trained pilots, some of whom have taken study loans from banks and are doing odd-jobs to service their debt and to make ends meet.

When news broke that Malindo Air was set up, the airline was flooded with enquires. In fact, when it conducted a walk-in interview early this month, throngs of people showed up for various jobs in the new airline. Among them were over 600 unemployed pilots who had travelled across the country for the interview.

“The airline is our fresh hope of fulfilling a career,” says an unemployed pilot who stood in line for three days for an interview.

Whether or not he gets the job will depend on him passing a written test, a psychometric test and a simulator test before he can ink a contract to fly for either Malindo Air, Lion Air or any other airline within the group.

However, they still need to attend aircraft type training which will initially be conducted in Jakarta and they will have to take loans which the group will help to provide. The training is essential to clock in the prerequisite flying hours with Lion Air before they can pilot for Malindo, which is expected to take off in mid-March next year.

To show its seriousness, the group will transport one simulator to Kuala Lumpur so training can eventually be done here.

Rusdi's strategy is a quick way of meeting the airline's needs, where instead of employing high school leavers to undertake training, he is hiring those who are already skilled and trained to undertake aircraft type and line training. That will help to save cost.

He acknowledges that “yes, it is a clever strategy but we are thinking of the long term. We could possibly take experienced pilots but then we would not be spending time to train the young pilots.”

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This is definitely great news to the fresh pilot grads in Malaysia and are still looking for their big break in an airline job. Lion Air means serious business with their unbelievably huge order of the new B737 back in February this year. Each plane will need minimally 10 pilots to operate and with the hundreds of planes coming in, it can only mean higher demand for pilots.

For those waiting for their opportunity, do not blow this chance.