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PT Angkasa Pura II Prepares 3 Scenarios in the Middle of the COVID-19 Pandemic

21 Apr 2020

Jakarta - The global pandemic of COVID-19 is an extraordinary challenge for the global aviation industry.

General Airport Council International (ACI) Director Angela Gittens in a publication on April 3, 2020, said that aircraft passenger traffic in the world in 2020 was initially estimated to reach 9.5 billion passengers, up 4.39% compared with 2019 around 9.1 billion.

However, looking at developments due to the global pandemic COVID-19, this estimate is believed to have not been reached, based on the realization of Quarter I / 2020.

Passenger traffic in the world in January was 6.9% lower than originally estimated, then in February it was 22.9% lower and March was 53.1% lower.

Cumulatively, aircraft passenger traffic in the world during January-March 2020 was 28.3% lower (equivalent to 620 million passengers) compared to initial estimates.

Seeing this condition, ACI estimates that the number of aircraft passengers in the world in 2020 was only about 5.9 billion passengers or 38% corrected (equivalent to 3.6 billion passengers) compared to the initial estimate of 9.5 billion passengers.

The impact is in Indonesia
The national aviation sector is also quite affected by the COVID-19 pandemic.

The Indonesian National Airline Association (INACA) on March 26, 2020 revealed that the number of airplane passengers since last month has decreased dramatically and in line with that the national airlines have reduced the number of flights, both routes and frequencies, by 50% or more.

Meanwhile, Finance Minister Sri Mulyani said at the US APBN conference on Friday 17 April 2020, revealing that during January - February 2020 there were 12,703 flights canceled at 15 major airports in Indonesia, consisting of 11,680 domestic flights and 1,023 international flights.

Furthermore, the Minister revealed that the air service sector lost revenues of Rp207 billion, of which Rp48 billion came from flights to and from China.

The downward trend in passenger traffic and aircraft movements in the middle of COVID-19 was also felt at the airport managed by PT Angkasa Pura II.

PT Angkasa Pura II President Director Muhammad Awaluddin said the number of aircraft passengers at the company's 19 airports this year was initially estimated at 93.92 million passengers.

"But then the global pandemic COVID-19 occurred, and by looking at existing trends and considering the situation, conditions, development of industrial and regulatory policies, it is estimated that the number of passengers will not reach 93.92 million passengers."

"We have determined that there are 3 scenarios as a basis for implementing a strategy in the midst of this pandemic. Scenarios are the Best Scenario, Bad Scenario and Worst Scenario," Muhammad Awaluddin explained.

Muhammad Awaluddin explained that in the Best Scenario, the estimated number of airplane passengers at 19 airports reached 68.22 million passengers or 27% lower than the initial estimate, while the Bad Scenario could be as much as 63.49 million passengers or 32% lower than the initial estimate, and in the Worst Scenario the number of passengers tends to be 57.80 million or 38.45% lower than the initial estimate. Estimates of the number of passengers based on the 3 criteria above are based on the end of the pandemic, the pace of recovery in the aviation industry and the normal period marked by stable economic conditions.

In facing this COVID-19 challenge, PT Angkasa Pura II has established a risk mitigation strategy, namely Business Continuity Management which consists of 3 phases, namely Business Survival, Business Recovery, and Business Sustainability.

The company is currently conducting a Business Survival phase with objectives including labor protection, cost leadership, selection of investment priorities and optimizing the company's cash flow.