Garuda Indonesia will finalise the buying of 30 wide-body jets from either Airbus or rival Boeing by the end of this year in a deal valued at about $9 billion, according to the airline's chief executive.
The Indonesian airline had signed letters of intent with both the aircraft manufacturers at June's Paris Airshow, but will decide to buy either 30 A350s from Europe-based Airbus or 30 787s from US-based Boeing.
Representatives of the two aircraft makers have been "pressing" Indonesia's carrier to finalise the deal since the firm showed its intent to buy aircraft from them.
"We are still comparing the two aircraft but we will go with only one type," Garuda Indonesia Chief Executive Officer Arif Wibowo told Reuters.
The carrier plans to replace its current fleet of Airbus A330s being used on medium and long-haul routes within Asia and operate more flights to Europe.
The new aircraft order comes at a time when the airline has put aside its growth plans in order to trim costs and improve margins, as the aviation sector is getting crowded in Southeast Asia. Garuda faces fierce competition from other players in the domestic traffic, while airports in the country are not "fully equipped or upgraded" to deal with the increase in traffic.
Garuda recorded a net profit of $27.7 million during the January-June period compared to a loss of $203 million in the same period last year.
The second half of 2015 is "challenging", said Wibowo, who took charge as the CEO of the airline in December last year.
Wibowo said fuel efficiency and operating costs will be important factors in the finalisation of aircraft purchase deal.
The airline recently faced ticket cancellations worth $20 million due to volcanic eruption in Lombok and the haze from forest fires in Sumatra, he said.
