Indonesia Commits to Developing Low-Cost Airport Terminals

Indonesia took a cue from Malaysia and Singapore, which have been operating low-cost terminals over the past several years. The two neighboring countries last year attracted 26 million and 17 million foreign tourist arrivals, respectively. Indonesia only managed to attract 14 million.

Low-cost terminals, which provide only basic amnesties, could allow airlines make significant cost savings. This may allow them to offer cheaper tickets and in turn, attract more travelers, Agus said.

“The low costs are derived from minimal services, but we will nonetheless always uphold safety, whether it be for low-cost airlines, terminals, or even airports,” he said.

The country’s largest airport operator, Angkasa Pura II, earlier announced a plan to transform Terminal 1 and Terminal 2 at Soekarno-Hatta International Airport outside Jakarta into Indonesia’s first low-cost terminals.

The terminals are undergoing a massive revamp to update and expand facilities dating back to their opening in 1985 and 1992, respectively. Angkasa Pura II president director Muhammad Awaluddin said the company will use the opportunity to transform them into low-cost terminals.

“We saw that it is possible to synchronize this program with the revitalization effort,” he said.

Awalludin said he will reduce human involvement in low-cost terminal services, which would further trim costs. Terminal 4 of Singapore’s Changi Airport has managed to achieve that by implementing automated machines from the check-in counters, through baggage storage to immigration counters.

“Is Changi low in quality? No. Did Changi abolish many of its functions? No. So we will match that standard,” he said.

Awaluddin said Soekarno-Hatta Airport’s low-cost terminals would further benefit budget airlines currently operating from there, including the country’s largest, Lion Air and Citilink.