Overview

Table: Total Market Size for Aviation, Unit: USD Millions

Data Sources: Indonesian Central Bureau of Statistics, U.S. Department of Commerce TradeStat Express, and unofficial estimates. Average exchange rate of Indonesian rupiah to U.S. dollars from the World Bank 
 

Indonesia’s Aviation Sector

Indonesia’s aviation sector continues to experience robust growth, driven by its expansive archipelagic geography, a large middle class, and increasing demand for air travel. The market is projected to achieve a compound annual growth rate (CAGR) of 6.5% from 2022 to 2028, positioning Indonesia as a significant player in the global aviation industry. Indonesia is Southeast Asia’s largest market for the aviation industry as Indonesia has 41% population of the Southeast Asia region. Having estimated 7.7 million km2 of aerospace area size, Indonesia is the 3rd fastest growing of aviation market in the world, after China and India based on aircraft purchase and trade value.

The number of international and domestic flights into Indonesia have been increasing the last few years, post the pandemic years. According to Indonesian National Air Carriers Association (INACA), Indonesia’s aviation industry continues to recover as passengers’ figures have reached 80 percent of the pre-pandemic level. Airlines are confident about the demand trajectory after air travel picked up rapidly. Data from the Ministry of Transportation – Directorate General of Civil Aviation, in 2024 Indonesia recorded 712,676 number of flights internationally and domestically, up from 696, 588 and 541,320 from the previous years of 2023 and 2022 respectively. Indonesia also saw an increasing trend of load factors of the flight as it is 82% in 2024, up from 79% and 78% in 2023 and 2022 respectively.

Currently, Indonesia has 683 airports, with 35 of them being commercial airports managed by the State-Owned Enterprise aviation and tourism company, InJourney Airports, which was established in September 2024, as the merging of PT. Angkasa Pura I (AP I) and PT. Angkasa Pura II (AP II).  However, the Ministry of Transportation Directorate General of Civil Aviation (DGCA) is managing most of airports in Indonesia. Today Indonesia has 20 international airports, an increase of 5 more airports from the previous year. Indonesia’s air travel international and domestic passengers’ growth have been increasing since 2022. Based on data from the DGCA, there were 29,189,842 and 65,944,835 number of domestic and international passengers respectively in 2023, while in 2024, there were 35,826,988 and 67,128,566 number of domestic and international passengers respectively. Meantime, the domestic and international traffic growths in Indonesia have been increasing as well. There were 178,236 and 518,352 domestic and international traffic growth respectively, while there was an increase in 2024, with 203,284 and 509,392 domestic and international traffic growth respectively. There has been an increase in terms of the number of cargo traffic as well as there were 797,707 (ton) in 2023, while there were 1,007,806 (ton) in 2024.

Leading Sub-sectors

Indonesia’s aviation industry encompasses several key leading sub-sectors:

• Commercial Aviation: The country remains the largest aviation market in Southeast Asia, accounting for a significant portion of the region’s air traffic. The necessity of air travel across Indonesia’s 17,000 islands underscores the importance of this sector.
• Maintenance, Repair, and Overhaul (MRO): With a growing fleet and increased air traffic, the demand for MRO services is escalating, presenting opportunities for both domestic and international providers.
• Airport Infrastructure: The expansion and modernization of airport facilities are ongoing to accommodate increasing passenger and cargo volumes, increasing the connectivity and to improve passenger’s airport experience in Indonesian airports.
• Air Traffic Management: Enhancements in air traffic control systems are essential to ensure safety and efficiency amid growing flight frequencies.

Opportunities

• Passenger Traffic Recovery: The aviation industry is rebounding from the impacts of the COVID-19 pandemic. In 2024, I Gusti Ngurah Rai International Airport in Bali served 23.9 million passengers, marking a 12% increase from the previous year.
   
• International Connectivity: The number of international passengers from January to August 2024 increased by 23.94% compared to the same period in the previous year, indicating a resurgence in international travel. The number of international passengers is expected to keep growing. 

Infrastructure Development: The government continues to invest in airport infrastructure, including the construction of new airports and the expansion of existing ones, to support the growing demand for air travel.

• Foreign Investment: Opportunities exist for foreign companies to participate in the development of Indonesia’s aviation industry, including collaborations with local airlines and contributions to infrastructure projects.
   
• Spare parts, engine and avionic systems, radar and navigation systems, maintenance and security products for airport operations.

Resources

• Directorate General of Civil Aviation, Ministry of Transportation: DGCA
• AirNav Indonesia: AirNav
• Indonesian National Air Carriers Association (INACA): INACA
• International Air Transport Association (IATA): IATA
• International Civil Aviation Organization (ICAO): ICAO 

For additional information and market guidance, please contact Commercial Specialist Mario Simanjuntak at Mario.Simanjuntak@trade.gov