BATIK Air is going to be the new name for Malindo Air.
This will come into effect in the second half of this year, but everything else will remain the same.
The rationale behind the branding change is to better align the offerings within Indonesia’s Lion Air Group stable of airlines to ensure there is seamless full service travel domestically and internationally.
“The feeder traffic from Lion Air group is not much now but the dynamics will change with Batik Air in the second half of this year,’’ Malindo Air CEO Chandran Rama Muthy says.
“We, Malindo Air (Batik Air Malaysia) will be the international link within the Lion Air group while the existing Batik Air Indonesia will continue to serve the Indonesian market and it is a full service carrier. We will promote Batik Air Malaysia brand across the 16 countries we operated in, and this will be a boost to our country, heritage and culture,’’ Chandran says.
The Lion Air Group controls Lion Air, Wings Air, Batik Air (Indonesia), Lion Bizjet, Malaysia’s Malindo Air, and Thailand’s Thai Lion Air. Malindo is 49% owned by Lion Group, controlled by Rusdi Kirana and his brother, and the remaining 51% is held predominately held by Chandran.
For a long time Indonesian carriers were banned from flying into Europe but that ban has since been lifted. Instead of Batik Air Indonesia flying all over the globe, the group has Malindo for its Asian connectivity, and the latter is now in the final stages of sealing a code share arrangement with a Middle East airline, which will give it global access to several markets.
Cities like London, Paris, Amsterdam, Stockholm, Rome, New York, Chicago, Rio De Janerio, Cape Town, and many others will be within reach once the code share is inked.
The idea is to keep the traffic flying within the group and code share partners.
Chandran is looking at several code share arrangements over the coming months and years as that is the only way the airline can grow its traffic profile and at the same time serve the market which needs connectivity.
No doubt Malaysia Airlines also has several code share arrangements and is member of oneworld alliance but choices are what the travelling public needs.
Malindo now offers interlining services to four airlines – Etihad Airways, Oman Air, Turkish Airlines and Qatar Airways.
It is hoping to end up with 30 such arrangements by the end of next year and this year it will add 10 more. “We have a big dream and by 2018 we would have 30 interline partners and several code-shares and our passengers traffic should be more than 10 million by then,’’ he adds.
Today Malindo boasts of 240 daily departures both from its bases in Subang and KLIA.
But back in 2013 when it started, not many believed this airline would pass the test of time. Many predicted that it would collapse soon after it took off.
But Malindo has proved its sceptics wrong up till now and is one of the fastest growing airlines globally given the spate of route openings and aircraft deliveries.
Last year it took deliveries of about ten new aircraft and this year it has taken deliveries of three. It expects seven more, adding to its current fleet of 45 currently. It will add five to seven new destinations to its existing list of 43 destinations.
“It is just growing and the pace has made people notice the airline,’’ says an industry observer.
One of the factors that had pushed it forward was due to Malaysia Airlines’ two major air disasters. While Malaysia Airlines shrunk its network, Malindo grew and capitalised on full service offering market.
Lower jet fuel prices and the move from klia2 to KLIA helped it reduce cost and price its fares appropriately to capitalise on the growth.
Malindo airfares are not like those low cost carriers as they do not charge for baggage and offer entertainment and meals onboard.
Malindo ended its first year carrying 900,000 passengers, and ended 2016 with 5.6 million. This year Chandran reckons the numbers will reach eight million.
From renting a small premises at Subang, it has bought over four floors in a building for RM16mil to house its operations, also in Subang. It has dedicated one floor for training purposes.
By June it will also be introducing the electronic flight bag for its crew so as to do away with paper.
For a company that does not own aircraft assets, it does not have to fork out big sums to buy aircraft. Instead it has operational leases with Lion Group at what Chandran says are at “market rates.’’
Is Malindo profitable?
“We are looking positive,’’ he says but will not elaborate. On whether Malindo would ever be listed, he says “let’s focus on making it profitable before dreaming of an IPO’’.