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PT Angkasa Pura II's Business Strategy to Lead the Aviation Operator Market in ASEAN

19 Nov 2020

Jakarta - PT Angkasa Pura II (Persero) has established a transformation program to become the market leader for aviation operators in ASEAN.

The transformation program was initiated four years ago, through Transformation 1.0 (2016 - 2020) then Transformation 2.0 (2020 - 2024).

At each stage of the transformation, the company comprehensively, consistently and prioritizes sustainability, develops 3 aspects, namely business and business portfolio (Business & Portfolio), infrastructure and operating system (Infrastructure & Operation System), and human resources (Human Capital). ).

In Transformation 1.0, the focus of developing the Business & Portfolio is to increase the contribution of non-aeronautical business revenue to be greater than the revenue from the aeronautical business, as has been done by other world airport operators.

President Director of PT Angkasa Pura II Muhammad Awaluddin said efforts to increase non-aeronautical business revenue in 2016 - 2020 include pursuing new businesses through subsidiaries.

"In 2016, we formed a subsidiary, PT Angkasa Pura Kargo and PT Angkasa Pura Propertindo. The two of them follow the existing subsidiary, PT Angkasa Pura Solusi. "

"Then, in 2019 we formed PT Angkasa Pura Aviasi as a strategic purpose vehicle for strategic partnership programs with global airport operators, including at Kualanamu Airport. In the same year, we increased our share ownership to become the controlling shareholder (46.62%) in the ground handling company PT Gapura Angkasa, ”explained Muhammad Awaluddin.

Through the optimization of the subsidiary, in 2019 the non-aeronautical business revenue is able to contribute up to 59% of the total revenue of PT Angkasa Pura II, while the contribution of the aeronautical business obtained from the Aircraft Passenger Service (PJP2U) tariff is 49%.

Business & Portfolio Development 2020 - 2024
In Transformation 2.0, PT Angkasa Pura II again developed the Business & Portfolio aspects.

Muhammad Awaluddin said the development was aimed at achieving three goals, namely positioning AP II to create an Airport Business Ecosystem, establishing new business models, and continuously seeking business opportunities (business pivoting).

"AP II must be able to revive the Airport Business Ecosystem, for example entering Food & Beverages retail, airport events, edutainment at airports, to hospitality, health and learning, as well as creating a Digital Ecosystem Service, for example by launching e-payments," said Muhammad Awaluddin.

In line with that, the company applies the adjacent business concept to create a new business (new wave business) in order to expand the market from its core business (aeronautics and non-aeronautics).

At the same time, the utilization and optimization of assets are also carried out. For asset utilization, for example by using vacant land to create new income. Meanwhile, optimization is carried out, for example by cooperating with hotel management at airports with brands that have international networks.

"Utilization and optimization of assets carried out will have an impact on the diversification of the business portfolio. Collaboration with other parties can reduce risk. In addition, the business portfolio is also experiencing rebalancing so that the results / returns can be maximized, "said Muhammad Awaluddin.

Global partnership
The Business & Portfolio expansion also focuses on accelerating the improvement of facilities and services through collaboration and partnerships with national and multinational companies that have big names in the global aviation industry.

"Like what we implemented at Kualanamu Airport, where we are looking for partners to jointly invest, develop, upgrade facilities as well as operate and maintain. Through the partnership, AP II shares capital expenditure and experience so that airports can be developed more quickly with world-class facilities, ”explained Muhammad Awaluddin.

Through this Business & Portfolio development, travelers at AP II airports can experience a seamless digital journey experience with world-class facilities.