PT Garuda Indonesia (Persero) Tbk decided to early terminate the rental contract for 12 Bombardier CRJ 1000 aircraft with Nordic Aviation Capital (NAC), which will mature in 2027.

"I firmly and Mr. Irfaniaputra, the President Director of Garuda who is here, supports and we have decided to return 12 Bombardier CRJ 1000 aircraft," said BUMN Minister Erick Thohir in a virtual press conference, Wednesday (10/2).

He added that the negotiation process has been carried out repeatedly between Garuda Indonesia and NAC but has not received a positive NAC response.

In addition to returning the Bombardier CRJ 1000 aircraft, Garuda is also negotiating an early payment settlement contract financial list with Export Development Canada (EDC) for six aircraft. Meanwhile, the contract expires in 2024, and the negotiation process is still ongoing.

"This decision has a basis of good corporate governance, transparency, professionalism, and accountability.  The decision also followed the decision of the Indonesian Corruption Eradication Commission and the British Corruption Eradication Commission (KPK) investigation into indications of bribery cases of aircraft manufacturers against Garuda leaders during aircraft procurement in 2011," he said.

In the same place, Irfan added, Garuda had been negotiating with NAC for a long time but did not get a positive NAC response.

"Therefore, we convey that starting February 1, 2021, we decided to unilaterally terminate the contract for 12 Bombardier CJR 1000 aircraft and return 12 aircraft to NAC," said Irfan.

He reasoned that Garuda took the step because this aircraft suffered losses from year to year and did not match the market's needs in Indonesia.

"We did this because it seems that after using this aircraft for several years, it does not match the needs of the market in Indonesia. From year to year, we experience losses using this aircraft, and coupled with the Covid-19 pandemic, we have no other choice to terminate this contract, "said Irfan.