On 12th January management of Mandala Airlines informed the Department of Transportation that it could no longer continue operating.
On the same day Mandala submitted a debt repayment deferment request to the Commerce Court in Jakarta, with Mandala’s corporate secretary Nurmaria Sarona saying that the company had found it unable to fulfill its lease payment obligations on its aircraft. If the court request is successful Mandala will have 45 days to submit a business restructuring plan.
Mandala is a small budget airline that operates only five aircraft (3 Airbus 320 and 2 Airbus 319); these planes have been returned to their owners. Until March 2010 Mandala had operated 11 aircraft.
The company has no plans to permanently dismiss its staff, and hopes to find new investors to shore up its financial position, and begin operating again. Its pilots will be lent out to other airlines like Tiger Air (a sister company of Mandala), so that they can continue working.
This has opened more doors to Malaysia's Air Asia to dominate the Republic's budget air carrier business. Personally, I dont see the airline will counter much problems as Indonesians are already taking Air Asia as a 'truly Asean airline'.
In a recent interview in the Jakarta Post, he said the carrier's Indonesian operations may surpass its Malaysian unit, which is now more than three times as big. However, it still has a long way to go.
Indonesia AirAsia’s passenger number rose 8 per cent to 1.1 million in the quarter, according to a statement. The Malaysian operations boosted passenger numbers up by 12 per cent to 4 million.
Good job, Air Asia! At the same time, its sad to see the demise of Mandala Airlines, once a 'suppose-to-be Air Asia' for Indonesia.