Indonesian flag carrier Garuda Indonesia is terminating its lease of 12 Bombardier CRJ-1000 jets amid a bribery probe surrounding the procurement of the order.
According to Indonesia's State-Owned Enterprise Minister Erick Thohir, the planes will be returned early to Nordic Aviation Capital (NAC). The contract was due to end in 2027.
In a virtual briefing with reports, Erick stated: "There are two issues, first was obviously the legal case,and the second is a force majeure because of the COVID-19 situation.” Garuda Chief Executive Ifran Setiaptura also added the airline has taken losses of more than USD $30 million per year over the past seven years using the jets.
Garuda has also taken to consideration a bribery probe by the UK's Serious Fraud Office over the procurement of the jets in 2011.
Along with returning the aircraft, the Jakarta-based airline is in talks over the early payment settlement for the lease of six CRJ-1000s from Export Development Canada due to end in 2024.
In response to the decision and the ongoing investigation, NAC issued its own statement saying it has received no notice of termination from Garuda saying: “NAC has continued these discussions but there has been no agreement to date, and no termination notice has been received. The lease agreements thus remain in full force and effect, and NAC expects Garuda to continue to honour its contractual commitments.” NAC also added further: “While NAC is sympathetic to the commercial difficulties of Garuda, it is confident of its position and absolutely determined to protect its commercial interest.”