Risky business

Passenger growth in Asia is outstripping forecasts and putting pressure on infrastructure, which is already failing to keep pace, resulting in serious safety concerns. 

Nowhere is this more true than in Indonesia, home to Southeast Asia’s busiest airport: Jakarta's Soekarno-Hatta International. The current projection by the International Air Transport Association (IATA) forecasts a growth of 4.9 per cent over the next 20 years, which translates to 3.7 billion seats. But last year, aviation analysts at OAG calculated that if the annual growth of Asia-Pacific passengers clocked in at double IATA’s projection, capacity would hit 7.4 billion seats by 2034. 

And if Asian travellers were to fly at the same rate as their European counterparts, OAG concluded that the figures would be “quite staggering” and “well in excess of the capacity levels that could be accommodated by airport developments in the pipeline”. Evidence that IATA’s forecast is naively low can be found in Indonesia, where international seat capacity grew 9 per cent last year and domestic capacity expanded 12 per cent. IATA had projected a 6.4 per cent growth in domestic capacity.  China and India are expanding at a similar pace, fuelled by a burgeoning middle class.

This boom has in turn driven the growth of low-cost carriers (LCCs), which charge a la carte for in-flight services and luggage allowance in return for inexpensive tickets. The trend began in the region in 2001 with Tony Fernandes taking over Air Asia, a then largely unknown and loss-making regional carrier, and quickly transforming it into a profitable budget airline with numerous affiliates such as Thai Air Asia in 2004. Indonesian offshoot Indonesia Air Asia was assimilated into the Air Asia group in 2005, starting life with a small fleet of Boeing B737 aircraft. These have since been replaced by 29 modern Airbus A320 aircraft, with a further 90 on order including the more fuel-efficient neo version.

Indonesia Air Asia is not the only carrier with big dreams in the world’s fourth most populous country, home to 255 million. Almost dwarfing its growth trajectory is fellow Indonesian carrier Lion Air. The airline began operations in June 2000, and by 2013 it had amassed over 100 aircraft. In March the same year, the Lion Group signed a US$24-billion contract with Airbus for 234 A320s – the most valuable commercial order in history, beating their previous record of a US$22.4-billion order for 230 Boeing jets in 2011. 

But these additional aircraft, and the passengers and cargo they carry, require space, infrastructure and equipment – something Indonesia, as well as other markets, are likely to struggle with.  Indonesia National Air Carriers Association (INACA) chairman Bayu Sutanto says Indonesia’s airline industry has reached saturation point because of a lack of infrastructure, particularly airports, which is preventing airline expansion. At most of Indonesia’s airports, passenger demand today already exceeds capacity by a wide margin. Jakarta’s Soekarno-Hatta International Airport is a perfect example, having processed more than 60 million passengers in 2014, nearly three times the number it was originally designed to handle. “The lack of infrastructural development has not only affected Soekarno-Hatta. There are other airports across the archipelago similarly affected,” said Sutanto, who added that pressure could be alleviated if more airports operated 24 hours a day. Relief is in sight for Soekarno-Hatta as government-owned airport operator PT Angkasa Pura II has pledged US$240 million for a third runway. However, it’s not expected to be operational before 2017, at the earliest. Across the country, the Indonesian government has unveiled plans to open 62 new airports over the next five years. Overcrowding and infrastructure handicaps at Soekarno-Hatta have also taken their toll on flag carrier Garuda Indonesia’s growth aspirations. Until late last year the carrier was unable to fully utilise its fleet of long-haul B777-300ER aircraft because the runway at Jakarta wasn't long enough to support take-off for these aircraft. 

Garuda had ordered the “Triple 7s” in 2010 and as such, it would have been reasonable to expect the relevant authorities to fix the issue ahead of time. With the runway now extended, Garuda flies the Jakarta – Amsterdam – London (Gatwick) route five times a week, its sole link to Europe, and plans to add one more service a week from July. Flying into Europe has not always been a given for Indonesia’s airlines. Until 2009, all Indonesian carriers were on an EU blacklist, because of safety concerns, effectively banning them from adding any EU port to their networks.  A review subsequently exempted five airlines from the ban – Garuda, Tigerair Mandala (Tigerair’s  Indonesian subsidiary), Indonesia Air Asia, and two VIP business jet charter companies. 

Better safe than sorry 

IATA director general Tony Tyler, said at an industry event in Jakarta in March that he was “very concerned about safety in Indonesia”, adding that of the country’s 62 airlines operating either scheduled or chartered services, only Garuda had passed IATA’s safety audit. Safety concerns reached a new climax on Sunday, December 28, 2014, when an Indonesia Air Asia A320 crashed into the Java Sea en route from Surabaya to Singapore, killing all of the 162 passengers and crew onboard. While the final report into the incident has yet to be released, two worrying factors surfaced immediately following the tragedy. Firstly, the ill-fated flight QZ8501, was not authorised to fly on Sundays as the carrier did not have the right permits. Further investigations revealed that this was no anomaly, as five other Indonesian airline operators had not obtained the correct paperwork to fly a number of routes. In response, Indonesia’s transport ministry suspended 61 flight licenses that had been issued to the non-compliant airlines, and 11 transport officials face ongoing disciplinary action because of the issue.

Second, it had taken Indonesian air traffic control (ATC) over two minutes to respond to a flight path deviation request from the Air Asia cockpit crew. By the time ATC contacted the stricken airliner again, it had already disappeared from the radar. Pilots familiar with flying in Indonesia tell Business Traveller Asia-Pacific that delays to ATC communications have increased recently: “ATC is just too busy dealing with the onslaught in new traffic […] and does not have sufficient manpower, or equipment, to do it faster”, said a pilot at one of the country’s largest airlines who requested anonymity because he was not authorised to talk to the media. The air safety oversight challenges Indonesia faces are typical in poor countries, where governments find it difficult to compete for qualified staff and have other spending priorities, such as health care and education, said Association of Asia Pacific Airlines director general Andrew Herdman. He said rapid growth in Indonesia has exacerbated these issues.

The number of passengers carried annually by Indonesia-registered airlines more than tripled between 2009 and 2013. Comparatively, the growth in a mature market such as the US shows a much more steady increase of about 30 per cent according to the Federal Aviation Administration (FAA).  “Many leadership positions have been taken by those without the right competence, or the wrong man [in] the right place,” said Saleh Husin, a member of Indonesia’s House of Representatives. But perhaps more pertinent to those flying in Indonesia for work or leisure is safety in the cockpit and cabin. With new aircraft entering service in Indonesia every week, training has failed to keep up with deliveries. Several industry experts have reported that airlines and ATC have been increasingly looking to cut corners in certifying those behind the controls.

The International Civil Aviation Organization (ICAO) – a United Nations agency – gave Indonesia aviation a scathing review in its latest audit released in May last year. In terms of safety oversight, the report placed Indonesia in the bottom quartile of 187 countries surveyed. The country scored below average in all of the survey’s eight categories, including legislation, operations and airworthiness. The organisational structure of Indonesia’s civil aviation scored 18 per cent, compared to a global average of 65 per cent. Albania, Burkina Faso, Cameroon and Kyrgyzstan all scored better.

Indonesia no anomaly

In its latest audit (March 2015) ICAO also cited “significant safety concerns” in Thailand, producing disquieting revelations about a country that has marketed itself as a safe and welcoming destination. The move prompted several Asian countries, including China, Japan and South Korea, to step up inspections of Thai airlines or block them from launching new flights or modifying schedules. 

The restrictions are expected to hit new Thai market entrant NokScoot hardest (part owned by Singapore Airlines’ subsidiary Scoot and Thai Airways’, Nok Air) and has already delayed the launch of planned scheduled services to Nanjing, Osaka, Seoul and Tokyo, originally slated for this month. In response, Thailand’s civil aviation authority has vowed to “urgently” improve airline safety. However, it is unclear whether sweeping changes can be implemented fast enough to avoid
a damaging downgrade of Thailand’s safety rating, which could also increase operating costs for airlines as leasing fees and insurance premiums would rise.

On a wing and a prayer?

What does this mean for business travellers? Should we no longer fly on Indonesian or Thai carriers? Or avoid travel to the region completely? I say, “no, absolutely not”. Instead, flyers are advised to select airlines that are regularly audited and exempt from flight bans. 

In Indonesia, national carrier and Skyteam alliance member Garuda Indonesia has made tremendous improvements to its safety record, fleet, network and in-flight products over the past decade. Its executive team, led by chief executive Arif Wibowo, is set on improving its tarnished reputation. In the budget segment, Indonesia Air Asia and Tigerair have both been declared safe by European regulators. By the same token, I would not think twice about boarding a Thai Airways or Thai Air Asia plane.

That said, it is important that airlines, operators and regulators accept responsibility for the air travel disasters of the recent past and regard them as an opportunity to learn lessons and improve oversight and safety legislation with sufficient mechanisms in place to safeguard passengers.

This article originally appeared 30 April in Asia Business Traveller.