Lion Air Expansion

 
   By Gaurav Raghuvanshi 
 

BATAM, Indonesia--Indonesian budget carrier Lion Air Monday said it will start international flights from Batam in 2015, taking advantage of the tiny island's geographic location to connect Indonesia with the Middle East, India and China.
Lion Air plans to make Batam, a one-hour ferry ride from Singapore, an aviation hub complete with a maintenance and overhaul facility.
Lion Air is building four hangars at Batam that will be used for heavy maintenance checks on its own jets and planes of rival airlines, company President Director Rusdi Kirana said at the opening ceremony of the maintenance facility.
"We chose Batam as an air hub because of its strategic location...in fact, the flying time between eastern and western Indonesia is shorter if you transit through Batam rather than traveling further south to Jakarta," Mr. Rusdi said.
International flights from Batam will start next year after Lion's domestic-network expansion is complete, he said. Lion currently flies to 15 Indonesian cities from Batam and plans to increase that to 20 this year.
Lion is looking at flying to destinations in China, India, Thailand and the Middle East from Batam, Mr. Rusdi added.
Separately, Lion Air announced that it has chosen engines from CFM International to power its fleet of 60 Airbus A320 jets that will start joining its fleet that primarily comprises of rival Boeing Co. B737 jets. The contract is valued at US$1.2 billion at list prices.
Write to Gaurav Raghuvanshi at gaurav.raghuvanshi@wsj.com

Lion Group has decided to make Batam, an island in Indonesia with very close proximity to Singapore, as its second major hub after Jakarta. International passengers will benefit from this decision, as next year Lion Group plans to launch international services from Batam.
Overseas destinations it aims to serve from Batam include points in southern China such as Guangzhou and Hong Kong. It also plans to serve Bangkok (Thailand) and Jeddah (Saudi Arabia) from Batam, as well as destinations in India, such as New Delhi and Mumbai. The flying distance from Batam to Northeast Asia and India is shorter than Jakarta.
Rusdi Kirana, president director, Lion Group said, “Batam is ideally located for people wishing to travel between eastern and western Indonesia. The distance is actually shorter if you transit in Batam rather than flying further south to Jakarta to transit. This is a ‘win-win’ situation for consumers and for the airline. The shorter flying time makes flying more convenient for passengers and it means aircraft burn less fuel, leading to significant cost savings.”
The group in recent months has also increased the number of domestic destinations it serves from Batam to 15 and aims to eventually serve 20 domestic destinations in Indonesia from Batam.
Lion Air will, be launching a daily non-stop service on January 29, 2014 from Batam to Pontianak using Boeing 737-800s and has plans to launch a Batam-Makassar and Batam-Bali Denpasar service.