Indonesia’s Aviation Industry: AirAsia Crash Exposes Violations
Indonesia has suspended several officials in connection to the AirAsia Flight QZ8501 disaster after preliminary results of the investigation indicate that the AirAsia airplane was not authorized to fly on Sundays (hence detecting a flight schedule violation). The AirAsia plane went down in the Java Sea on Sunday 28 December 2014, en route from Surabaya (East Java) to Singapore, presumably killing all 162 people on board. Authorities have barred the airline from flying this route until the investigation is over.
Acting Director-General for Air Transport, Djoko Murjatmodjo, said that, although the flight schedule violation is most likely not connected to the crash, all officials (at Indonesia’s Transportation Ministry and Surabaya’s Juanda International Airport) involved in the unauthorized flight schedule are to be suspended and authorities are also to investigate flight schedules of other airlines. The AirAsia disaster may thus expose unprofessionalism or corruption in Indonesia’s aviation industry. Indonesia’s bureaucracy, known for being a complicated, costly and lengthy affair, remains rife with bribery and corruption. AirAsia is yet to comment on the allegation that it was not allowed to fly the Surabaya-Singapore route on Sundays. Reportedly, the airline had been flying the route for two months prior to the accident.
As such, the AirAsia accident put the spotlights back on Indonesia’s aviation sector, particularly on safety issues in this industry. Most Indonesian airlines have been banned from flying to the Eurozone and the USA since the 2000s due to poor maintenance and a series of accidents. According to the United Nations, Indonesia still ranks among the world’s least safe aviation industries. But, paradoxically, the aviation industry in the Asia-Pacific is also one of the world's fastest growing regions in terms of air travel with an expected average annual air passenger growth rate of seven percent (y/y) over the next 20 years, thus bringing along responsibility. In Indonesia, per year, more than 50 million people opt for air travel to travel across the vast Archipelago. After deregulations in the 1990s, new airlines mushroomed in the 2000s as Southeast Asia’s largest economy recovered from the Asian Financial Crisis and the economy started to grow robustly again. However, intensifying competition also meant that airlines’ profit margins declined and in some cases budgets for airplane maintenance were cut.
After the 2007 ban (when Indonesian airplanes were banned from flying to the USA and Eurozone) there has been an improvement detected in Indonesia’s aviation industry. Tatang Kurniadi, Head of Indonesia’s National Transportation Safety Committee, said that Indonesia’s aircraft accident rate declined to 0.82 per million flights in 2014, significantly down from 2.94 per million flights in 2007.
Indonesia AirAsia - the unit of Malaysia’s low-cost carrier - had excellent safety records prior to the disaster in the Java Sea. Malaysia's AirAsia is the world's largest budget airline and has been named the world's best low-cost carrier by Skytrax for five consecutive years between 2009 and 2013.
ASEAN Open Skies Policy
The AirAsia accident (as well as the two recent fatal Malaysia Airlines accidents) are not expected to affect implementation of the ASEAN Open Skies policy which will liberalize and transform Southeast Asia’s airspace into a single aviation market (effective from 1 January 2016). This policy is part of the ASEAN Economic Community (AEC). However, prior to its implementation, authorities should improve monitoring of the aviation industry in order to avert violations (such as the flight schedule violation) and enhance airlines’ compliance with safety regulations. This should then lead to improved competitiveness of Indonesian airlines, one of the main concerns ahead of liberalization of the aviation industry. Analysts claim that Indonesian airlines are generally not ready yet to face increased competition brought about by the ASEAN Open Skies scheme due to tax policies, airport inefficiencies and high aviation fuel costs (causing weak competitiveness).
Indonesia AirAsia QZ8501 Crash
Meanwhile, a total of 37 bodies have been recovered from the Java Sea where the search operation met resistance from bad weather. Based on the latest reports, the operation is getting closer to locating the airplane’s fuselage, which is important to discover the black box.