Susi Pudjiastuti: From Sea to Air

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FLYING has been Susi Pudjiastuti’s dream since childhood. But it has been a long and winding road to realize her dream. She started her career as a simple fish vendor on the pristine Pangandaran Beach and later pioneered the export of her various sea products to Japan.

The 1998 financial crisis that saw the rupiah plummet and the prices of export commodities rise also gave huge profits to the fishermen in the country. Susi also enjoyed the financial blessings and soon built a modern fish processing factory in a small town located hundreds of kilometers from Jakarta.

To save time and meet delivery deadlines for the dispatch of lobsters and other seafood, Susi started using air freight. “We can get better prices for fresher products and so do the fishermen, who make higher profits, so the consignments have to arrive on time,” said the Javanese woman, who can speak English, German and Sundanese fluently.

At that time, funds were a serious handicap so she started to seek loans from banks. For no fewer than four years, Susi presented her proposal to various banks and applied for loans. None were interested, and some even thought she was crazy. Finally Bank Mandiri showed an interest and gave her a loan of US$4.7 million, which she used to build an airstrip and purchase two Cessna aircraft.

It was only one month after the arrival of the planes in Indonesia that the tsunami occurred in Aceh. Her conscious pulled on her heart strings. She flew to Aceh to deliver aid to the victims with her husband, Christian von Strowberg, as the pilot.

They arrived in Simeuleu and Meulaboh just one day after the tragedy. While she initially planned to stay in Aceh for only two weeks, “Susi Air” (the name of her airline that was coined suddenly) was asked to stay by the NGOs, and she ended up staying there for two years.

This airline company, which since 2004 has been serving unpopular routes in various remote areas, has kept growing. The number of its aircraft has also grown to dozens of planes. Next to its main office in Pangandaran and Halim Air Base, it also has a branch office in Papua. “Our planes carry rice and other required items to the people living in villages in the mountains,” she explained.

Susi Air not only operates commuter flights but also offers VIP charter flights. In 2012, 30 new planes ordered at the Paris Air Show in 2009 will start arriving.

“We bought the planes during the economic crisis in Europe and the United States when no company or individual dared to buy planes, so an L/C was not required, nor any down payment. We can even pay after the delivery of the planes,” said Susi, who is a mother of three.

Although she did not finish high school, Susi tries to learn about business from other people’s experiences, communicates a lot with many people and takes management lessons.

She decided to buy new planes because the operational costs would be low and would help her achieve her long-term goal. While it is true that secondhand planes are cheaper and bring in profits quicker, their operational costs are much higher.

“Most of our competitors still use planes that are 23 years old or more and their fuel cost is more than 35 percent of the operation costs. When oil prices go up, such companies collapse easily!” explained Susi, who received a Young Entrepreneur of the Year award from Ernst and Young Indonesia.

Her reasoning in purchasing the 30-seat Cessna C208B Grand Caravan is that they can land on small runways. “Our slogan is a one-kilometer runway brings you to the world and the world to you,” said Susi, adding that the planes can land at 550 airports across the country. She has also built and manages small airports at Pangandaran, Cidaun and Cianjur.

The airstrips are just one kilometer long, which is why her planes can land at towns along the beaches, pick up fishermen’s catches and directly dispatch them to domestic and foreign destinations, such as Japan, China and Hong Kong. Outside her privately owned airports, Susi is always available to cooperate and work with local governments.

For her VIP charter services, Susi purchased New Piaggio Avanti II (6-8 seats), which are capable of flying more than 1,800 kilometers non-stop at a speed similar to jets but with half the fuel consumption. She also has a Pilatus PC-6 that can be transformed into an air ambulance or used for air surveys.

Her fleet also has two fast helicopters — a Grand Agusta made in Italy and costing about US$7 million, and a Koala A119Ke for Jakarta and its surrounds. Her clients, consisting of executives, government officials and NGOs, pay $3,500 per hour.

From its base on the BNI 46 building rooftop in Jakarta, the helicopters can serve transportation needs for distances that can be reached within minutes. The helicopters can land on 40 helipads in Jakarta.

Although appearing successful and prestigious at the outset, Susi admits that she struggles with money issues. Almost 75 percent of the revenue goes to state-owned companies, that is, 35 percent to Pertamina for fuel, 35 percent to repay bank loans, namely from Bank Mandiri, BNI and BRI, and 5 percent to PT Angkasa Pura in landing fees. The remaining 25 percent is for miscellaneous costs and for employees’ salaries (17 percent).

“If I can still make a 5 percent profit after covering the outlay then it is fine,” said Susi, who is on the board of directors of the Indonesian Fishermen’s Association.

Susi Air is known for opening up new routes to new destinations and flies seven days a week whether all seats are full or not. Her intention is to help remote areas develop further and to develop the related markets. In this case she applies a block seat system in collaboration with local governments.

“This method is indeed a burden for me but it gives confirmation about the market. At first it was difficult but it proved to be successful,” said Susi, who is fond of swimming.

According to Susi, one of the problems in Indonesia is the lack of infrastructure, which creates a high-cost economy. Transportation between cities in Kalimantan, for example, has to be via Jakarta. She hopes that in the next five years Susi Air can cover all 550 small airports in the country.

Another handicap in the airline business, said Susi, is human resources. All her pilots are foreigners as she said Indonesia is short of pilots. All her 100 foreign pilots indirectly provide livelihoods for 600 people working in the fishery industry, which almost went bankrupt, and the 400 employees of Susi Air.

“We need foreigners to fly our planes before there are no Indonesian pilots,” she said. Therefore she has established the Susi Flying School and has offered scholarships to 10 Indonesian students.

Susi’s obsession is that in the next five to 10 years Susi Air can become a leading and major airline in Indonesia and that the Indonesian people can fly on Susi Air from Sabang to Merauke. Anywhere you go in Indonesia you can fly back within a day with Susi Air.

“This way we are also participating in or contributing to the unity of the Republic of Indonesia,” she asserted. (Lily G. Nababan)

The Jakarta Post, October 30, 2010

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