Recovering from pandemic-induced losses, Southeast Asian airlines are securing substantial aircraft purchase agreements to meet the rising demand as tourists return. Indonesia's national carrier, Garuda, plans to lease eight aircraft this year, increasing its fleet to 80 and boosting the frequency of flights by year-end.
Garuda Indonesia’s Finance Director, Pahala Mansury, stated that the monthly rental cost per aircraft ranges from US$200,000 to US$500,000.
Thai Airways has finalized a deal with Boeing and other suppliers to acquire a total of 45 aircraft, as reported by Nikkei Asia.
According to CEO Chai Eamsiri, Thai Airways aims to expand its fleet from 70 aircraft at the end of 2023 to 96 by 2033. Additionally, Thailand's government has extended its tourist visa exemption to 93 countries, up from 57, which is expected to bolster the aviation industry's recovery post-pandemic.
Other Southeast Asian airlines are similarly investing in capacity growth. Philippine Airlines is tripling its investment to US$ 450 million this year for fleet upgrades and maintenance. The airline also intends to order 22 new aircraft to serve routes to North America and other destinations.
As air travel demand rebounds, Southeast Asian airlines are striving to achieve growth once more.
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Singapore was the first in Southeast Asia to partially lift its foreign travel ban in September 2021. To reclaim market share from European and American competitors, which reopened earlier, Singapore Airlines rapidly increased flights, achieving a net profit of over US$ 1.97 billion for fiscal 2023, a 24% increase from the previous year.
However, having just emerged from losses and significant debts, these airlines might not be financially robust enough to withstand another major business environment shift.
Additionally, these airlines need to consider the competition for higher-paid pilots following fleet expansion and carefully manage costs to ensure financial sustainability.
