Wirraway
12th Sep 2002, 20:07
Fri "Australian Financial Review"
Perth to Bali via Paradise
Sep 13
Peter Klinger
The first dedicated Australia-Bali tourist airline expects to take off at the end of next month, servicing the Perth and Melbourne markets.
The owner of Air Paradise International, wealthy Balinese businessman Kadek Wiranatha, expects to operate four weekly flights from Perth to Denpasar and three weekly flights leaving Melbourne.
Air Paradise will also run three weekly flights between Denpasar, Bali's capital, and Jakarta.
Mr Wiranatha, who owns a number of tourist destinations in Bali, wants to cash in on the lack of direct flights from Australia to the Indonesian holiday province.
Air Paradise has leased a former Singapore Airlines A310-300 aircraft, with a second aircraft expected to join in December.
In Perth yesterday to promote the fledgling airline, general manager Barry Hess was reluctant to specify forecasts other than to reject suggestions Air Paradise's fare structure would lead to a price war.
He said the airline could achieve what he said was an industry break-even scenario of 65 per cent occupancy on flights, while an initial 10 per cent gross operating margin was also feasible.
"I would suggest we'd be break-even within two years; obviously that's all about image-building and confidence-building," he said.
Part of Air Paradise's strategy will be to offer direct flights during daylight hours to and from the holiday island, with a vast majority of flights part of travel packages.
Mr Hess pointed to an undersupply of seat capacity to Bali, as evidenced by long waiting lists out of Melbourne, and national carriers Qantas and Garuda Indonesia's focus on other routes.
Mr Hess said financial benefits as a result of being based in Bali would help the airline, although he said operating costs would be minimal.
The leasing fees for the two planes are likely to be less than $10 million, and services such as ground-handling, terminal operation, maintenance and technical support will be outsourced.
Perth to Bali via Paradise
Sep 13
Peter Klinger
The first dedicated Australia-Bali tourist airline expects to take off at the end of next month, servicing the Perth and Melbourne markets.
The owner of Air Paradise International, wealthy Balinese businessman Kadek Wiranatha, expects to operate four weekly flights from Perth to Denpasar and three weekly flights leaving Melbourne.
Air Paradise will also run three weekly flights between Denpasar, Bali's capital, and Jakarta.
Mr Wiranatha, who owns a number of tourist destinations in Bali, wants to cash in on the lack of direct flights from Australia to the Indonesian holiday province.
Air Paradise has leased a former Singapore Airlines A310-300 aircraft, with a second aircraft expected to join in December.
In Perth yesterday to promote the fledgling airline, general manager Barry Hess was reluctant to specify forecasts other than to reject suggestions Air Paradise's fare structure would lead to a price war.
He said the airline could achieve what he said was an industry break-even scenario of 65 per cent occupancy on flights, while an initial 10 per cent gross operating margin was also feasible.
"I would suggest we'd be break-even within two years; obviously that's all about image-building and confidence-building," he said.
Part of Air Paradise's strategy will be to offer direct flights during daylight hours to and from the holiday island, with a vast majority of flights part of travel packages.
Mr Hess pointed to an undersupply of seat capacity to Bali, as evidenced by long waiting lists out of Melbourne, and national carriers Qantas and Garuda Indonesia's focus on other routes.
Mr Hess said financial benefits as a result of being based in Bali would help the airline, although he said operating costs would be minimal.
The leasing fees for the two planes are likely to be less than $10 million, and services such as ground-handling, terminal operation, maintenance and technical support will be outsourced.