Lack of Competition on Makassar-Bali Air Corridor

(10/27/2003)

Mr. Nico B. Pasaka, Chairman of the South Sulawesi Association of Indonesian Travel Agents (ASITA), has called on the Ministry of Transportation and local air carriers to increase the number of flights connecting Makassar and Denpasar (Bali). Citing the need for more flights as necessary to the long-term recovering of South Sulawesi's tourism economy, Pasaka also called for more involvement from the Government in pro-active steps to revitalize the badly damaged tourism sector.

A Lack of Competition

Currently, only two airlines offer direct air connections between Makassar and Denpasar: Garuda Indonesia and Merpati Nusantara.

Garuda flies daily using B737-400 aircraft with Merpati operating three weekly flights with B737-300 equipment.

Non-direct services are available with an intermediate stop in Surabaya on Pelita Air and Mandala.

A Need for Competitive Air Fares

The lack of seats between the two cities, according to Pasaka, has also resulted in an artificially elevated pricing structure. The one-hour flight from Denpasar to Makassar costs Rp. 605,000 (approximately US$ 71), while a two-hour flight from Makassar to Jakarta costs Rp. 540,000 (approximately US$ 63.50).