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Planes on the Ground with No Place to Go!

Indonesian Government Revokes Domestic and International Route Permits for Adam Air.

(4/11/2008) Indonesia's Department of Civil Aviation has formally withdrawn all route authorizations for Adam Air effective April 9, 2008. The Minister of Transportation, Safeii Djamal explained that the airline has not flown for 21 days as the reason for the revocation while calling on the owners of Adman Air to meet any legal obligations to its employees.

Prior to the government's latest move, Adam Air held operating rights on 21 domestic air routes and 4 international routes.

Responding to the revocation of its air routes, the President Director of Adam Air, Suherman, said the decision was understandable in light of the system-wide grounding of the Airline.

Suherman is, however, fighting to retain his Airline's air operating certificate (AOC) while waiting for the next meeting of Adam Air's Board of Directors. Suherman said the Company's present cash position was only sufficient to continue to pay their employees, refund tickets and make installment payments on company debt. The funds needed to enhance safety standards and recommence flights, he insisted, can only be obtained through the injection of fresh funds from stockholders.

In a related development, Kompas reports that Adam Air has assured employees that Rp. 10 billion (US$1.1 million) is standing by to pay the April salaries of its 3,000 employees.

Fueling the Airline's employees fear that wages won't be paid is news of an internal rift in which Adam Airís Financial Director, Gustiono Kustianto, has resigned leaving the company without anyone legally entitled to sign the payroll authorization.

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