http://www.nytimes.com/2013/05/02/business/global/02iht-lionair02.html?_r=0&adxnnl=1&ref=asia&adxnnlx=1367523037-GwkVSHHk3o7ZDTo+oDQK6Q&pagewanted=all
Low-Cost Indonesian Airlines Keep Growing, Despite Troubling Record National Rescue Team, via Associated Press Rescuers at the crash site of a Lion Air plane off the Indonesian resort island of Bali last month. By JOE COCHRANE Published: May 1, 2013 JAKARTA — The sight of passengers swimming ashore from the wreckage of a Lion Air plane that missed a runway and crashed into the ocean off the Indonesian resort island of Bali on April 13 was not the only thing about the airline that drew big headlines this year. The crash, which did not kill anyone but resulted in dramatic photos of passengers’ being rescued from the water, came a month after the airline, the biggest Indonesian carrier, turned heads with its second major expansion deal in three years, ordering a record 234 planes March 18 from Airbus for $24 billion. The purchase underscored the explosive growth of Lion Air as it struggled with a troublesome safety record, raising wider questions about air safety in Indonesia, one of the world’s fastest-growing aviation markets. The European Union has banned Lion Air from flying there, and the crash was one of several accidents involving the airline since it began commercial operations in 2000 with a single leased Boeing 737-200. In 2004, a Lion Air jet crashed in Central Java Province, killing 25 people. In 2002, one of its planes crashed on takeoff in Riau Province on Sumatra Island, and in 2006, a Lion Air jet crashed after landing in Yogyakarta, in Central Java, although no one was killed in the 2002 and 2006 incidents. The low-cost carrier has also had multiple incidents in which planes have skidded off, run off or overrunn airport runways. In addition, four Lion Air pilots were arrested by the police in separate incidents in 2011 and 2012 for possession of drugs including ecstasy pills and crystal methamphetamine. But that spotty safety record has not curbed the ambitions of Rusdi Kirana, Lion’s media-shy founder and chief executive. On Thursday, Lion Air introduced the full-service Batik Air, which will serve both domestic and international routes. Despite being a low-cost carrier, Lion Air already dominates Indonesia’s domestic air travel market, with a 40 percent share, according to analysts. Some people in the industry say Indonesia’s regulation of its airlines has failed to keep pace with the sector’s growth. “Last I checked, we had less than 200 air safety inspectors for the whole country,” said Danang Parikesit, a transportation expert and president of the Indonesia Transportation Society. “You can imagine that with traffic increasing by 20 percent a year for the last five years and you have less than 200 safety inspectors? What do you expect?” He said the country’s focus should be on improving regulation of the aviation industry, instead of blaming operators when an accident occurs. “At the end of the day, it’s the regulator that allows the conditions in which the operators operate,” he said “We have already asked the Indonesian government to increase the capacity of safety inspections and the inspection programs, given that the growth of the airline industry in Indonesia is quite high.” The Bali crash inquiry, led by the Indonesian National Transportation Safety Committee, is continuing as investigators look into claims by the pilot that he felt the aircraft being dragged down by wind, indicating a possible case of wind shear or a microburst. Industry analysts said that whatever the cause, the crash raised some worrying red flags. “It’s certainly a concern, given that it was a brand-new airplane,” said one aviation analyst based in Southeast Asia who insisted on anonymity because his organization did not publicly comment on safety issues regarding individual commercial airlines. Herry Bhakti, Indonesia’s director-general of civil aviation, urged the public not to jump to conclusions about Lion Air’s safety practices and competence until the investigation was complete. He also suggested that politics might be driving criticism of regulators as the country prepared for elections in 2014. In fact, Mr. Bhakti said, the rate of incidents and accidents involving Indonesia’s 121 commercial operators, including Lion Air, has declined since 2009. All of those airlines except Garuda Indonesia, the flag carrier, are medium-service or low-cost carriers whose growth is closely monitored by the Directorate General of Civil Aviation, or D.G.C.A., he said. “Lion is growing, but we evaluate them, their personnel, management and so forth,” Mr. Bhakti said. “We evaluate them every year. They desire an additional 35 aircraft, for example, but we only approved half of that. They ask for more aircraft, and we evaluate, but we never approve their full request.” Aviation analysts based in Indonesia said there was no evidence that low-cost airlines in the country had worse safety records than established full-service carriers, noting that in general those carriers used newer planes and outsourced their maintenance to established airline companies, including Singapore Airlines and Lufthansa. “If you look at the last 15 years since low-cost carriers started in Indonesia, and you look at accidents that involved death or incidents or near misses, the evidence is to the contrary,” said Hasan Soedjono, a former airline executive who is considered one of the founding fathers of the country’s budget carrier sector. In June 2007, the European Union issued a blanket ban prohibiting 51 Indonesian airlines, including Lion Air, from flying into European airspace, citing lax safety standards after two deadly crashes that year. The crashes included an Adam Air flight that plunged into the Makassar Strait on New Year’s Day, killing all 102 people aboard. Julian Wilson, the European Union’s ambassador to Indonesia, said the 2007 ban had not been aimed at any particular airline but at the performance of the Directorate General of Civil Aviation. He said Indonesia had since resolved two-thirds of the problems identified in a 2007 audit by the U.N. Civil Aviation Organization, which led the Union to ban Indonesian airlines and the United States to downgrade its rating of their safety. “Our position on Indonesia is that the D.G.C.A. has made great advances, and we hope we can get all of Indonesia cast in a more favorable light, meaning no restrictions, by the end of the year,” Mr. Wilson said. “I don’t know what the views were on Lion, but I am sure the D.G.C.A. is going through the standard procedures and protocol for investigation, to see if there’s a systemic problem,” he said. Despite the Bali crash, Lion Air’s passenger numbers are continuing to grow, according to industry analysts. Mr. Parikesit said the carrier’s market segment consisted of middle- to low-income Indonesians, who also do not hesitate to take ferries and long-distance passenger buses in the aftermath of sinkings or horrific road accidents, which are not uncommon in Indonesia. “They are very insensitive to accidents,” he said. “It’s more on their perceptions of the value of life and the perception that the accident happened because it was meant to happen, like it’s fate.” A version of this article appeared in print on May 2, 2013, in The International Herald Tribune. [Non-text portions of this message have been removed]
