Editor’s note: As some of you know, we like to give aspiring aviation professionals a voice as part of our Generation Y feature. So today we have Maxim Roelen who is writing a 2-part series on Indonesia airports focusing on the situation in Jakarta.
Jakarta is the beating heart of Indonesia’s aviation market, one easily forgotten, but it is growing at a dazzling speed. IATA expects Indonesia to become the sixth largest air passenger market in the world and the fifth largest domestic market by 2034. But not all is so rosy in Jakarta.
Indonesia’s largest carriers Garuda Indonesia and Lion Air are planning massive growth, focusing at the highly congested Jakarta Soekarno-Hatta Airport. Despite tremendous growth, Jakarta and Indonesia have failed to expand airport capacity. Real solutions stay behind and airlines are worried about their planned expansion with already hundreds of aircraft on order.
Earlier this year, Guillaume Dupont wrote about the capacity constraints in Jakarta (Indonesia Airports Build: Jakarta Airport Failure) and those of Indonesia in general (Indonesia Airports Build: Overcrowding). In part 1, I will focus on the continuing capacity constraints at Soekarno-Hatta airport, and in part 2 on alternative airports.
An Explosive Growth in Indonesian Air Transport Market
In 2014 the Indonesian air transport market will exceed 100 million passengers, with yearly growth rates exceeding 10%, double the economic growth. IATA expects that by 2034 Indonesia will represent 270 million passengers, of which 191 million on the domestic market. High economic growth, a growing middle class and the ASEAN Single Aviation Market are the 3 main ingredients for Indonesia’s growth.
The growing ASEAN market will play a key role as of 2015. A partly deregulated market in Southeast Asia will allow more routes, higher frequencies and more competition. Ticket prices will likely drop, enabling more people to fly. After opposing the ASEAN single aviation market, Indonesia agreed in 2014 to open Jakarta for unlimited capital-to-capital flights.
Jakarta Soekarno-Hatta Airport alone has been responsible for over 60% of Indonesia’s market. Including the broader surrounding region of Jakarta, it can be expected that it will represent 150 to 200 million passengers in 2034.
How Chronic is Airport Capacity Shortage?
As the primary Indonesian airport, Jakarta Soekarno-Hatta handled not less than 60.1 million passengers in 2013, quite an achievement for an airport which was designed to handle just 22 million passengers.
Terminal expansion is being carried out as we speak, but too little, too late. Plans are to improve the airport experience and increase capacity to 62 million passengers per year, a project which will be finished in 2017 at the earliest, while actual traffic will already exceed the 62 million mark in 2014 and is expected to reach 80 million by 2020.
Airport expansion in Indonesia has been a matter of (late) reaction instead of coordinated planning and anticipation, causing a chronic shortage of airport capacity. This is not only the case in Jakarta, but also in the rest of the country as explained in the earlier article of Guillaume in May 2014.
Current alternatives for the highly congested Soekarno-Hatta Airport are basically non-existent, except for the small downtown airport of Halim which was reopened in January 2014 to civil traffic. So far only Citilink moved a limited amount of flights to this airport. Reopening of this airport was deemed a temporary solution, though the Lion Air Group is on the contrary betting for the long term on Halim. Halim Airport will be covered in more detail in part 2.
How Faulty is Soekarno-Hatta Expansion?
In 2013, Soekarno-Hatta International Airport was the tenth busiest airport in the world according to ACI, but probably the biggest example of how airport development can be a total failure.
State-owned airport operator Angkasa Pura II (AP II) failed to expand the airport to facilitate rapid growth. Numerous projects have been proposed over the past decade, but none finished so far.
Currently, Terminal 3 has a capacity of 4 million passengers, but by the end of 2015 the new expanded 380,000m2 facility should be able to handle 25 million annual passengers. The existing Terminal 3 will be an integrated part of the new U-shaped facility. Designed with the help of Seoul Incheon Airport consultants, this terminal is supposed to become the most modern and efficient airport terminal in Indonesia, a symbol for a modern and quickly evolving Indonesia. A great leap forward, even though Terminal 3 will not solve Soekarno-Hatta’s issues with its 25 million capacity.
Also part of the $1.24 billion expansion plan of AP II is to expand the two original terminals.
Terminal 2 was built for 9 million passengers and will be expanded to handle 19 million passengers by 2016. Domestic Terminal 1 will be enlarged to handle 18 million passengers by 2017, up from its current capacity of 10 million. Both terminals will be connected with an integrated building which will house commercial zones, hotels and will be used as a ground transport hub for the airport. Drop-off zones for taxis and buses and 20,000 car parking lots are planned. An automated people mover will allow smooth transfers between terminals and a train connection to the city center is planned.
The whole refurbishment project is to be finished by 2020, though delays can be expected. Just 2 years have been foreseen for the expansion and complete refurbishment of Terminal 1 and 2 after the opening of the new Terminal 3 and a few more years to finish the massive integrator building, an ambitious undertaking for an airport that failed in expansion for more than a decade.
Even in an optimistic scenario of the whole project being finished on time, Soekarno-Hatta airport will still face a capacity shortage of about 20 million by 2020 (that is if no alternatives are found in the greater Jakarta region to cope with the projected growth). Possible alternative airports will be covered in part 2.
And a new Terminal 4 could further expand the airport’s capacity, but the opening is not expected until beyond 2021. Tri Sunoko, President of AP II, says this terminal will have a capacity of 18 to 20 million. That will raise the airport’s capacity to 80-82 million, a number that will already be reached by 2020 before the potential opening of Terminal 4.
How Important is a Third Runway?
Besides restricted terminal capacity, another major issue is runway capacity. The capacity of the existing two runways was raised from 64 to 72 aircraft per hour in 2014, after reducing the aircraft occupancy time and improving navigation systems. The airport wants to push this even more by increasing the capacity to 86 aircraft per hour in 2015.
In 2013, Soekarno-Hatta already handled around 399,000 movements on its 2 runways. That equals almost 200,000 movements per runway, the highest number of the 20 busiest airports in North and Southeast Asia.
If Soekarno-Hatta wants to reach its ultimate capacity and grow beyond 87 million, to 100 million passengers per year, it needs a third runway. AP II hopes to start constructing this new 3,660 meter long runway as early as 2016. The US$ 350 million needed to clear land might be provided by the national government, despite current legislation not allowing this.
According to Indonesian Deputy Transportation Minister Bambang Susantono, building another runway is the only possible solution to accommodate further airport expansion. In the most optimistic situation the runway opens in 2017, though given the current state of the project this can easily be delayed to 2018-2019.
How will Jakarta Secure New Capacity?
Despite ongoing expansion, Soekarno-Hatta is not able to catch up with growing demand. An ultimate planned capacity of up to 100 million passengers at Soekarno-Hatta is clearly not enough to serve the needs of the Jakarta region in the coming 20 years.
If Jakarta and the densely-populated surrounding region want to secure airport capacity for the long term, it needs a second major airport with a similar capacity as Soekarno-Hatta Airport. A new airport located outside Greater Jakarta can partly serve the same market as Soekarno-Hatta, while also catching the growing markets in the adjacent West Java and Banten provinces. Suitable projects in West Java and Banten are being planned, but yet to be constructed.
A detailed analysis of potential relief airports such as Halim and planned large hub projects, and the problem of competition between proposed airports east of Jakarta will be addressed in part 2.
New IATA Passenger Forecast Reveals Fast-Growing Markets of the Future
Soekarno Hatta International Airport Terminal 3 Winning Proposal
ACI 2013 World Airport Traffic Report
ASEAN’s single aviation market must gear up for new but harder phase
AP II secures loan to develop Soekarno-Hatta
In collaboration with ADB Airfield Solutions, we are conducting a short online survey to identify top issues that concern airports and key priorities for 2015. The survey results will be published on both websites in May 2015 and all data collected will remain confidential. Will you take the survey?