Sunday, February 3, 2013

Turkey moves to mark its place in the skies


Instanbul, Sunday

Turkey is aiming to make a major mark in the skies with ambitious plans to build the world’s largest airport and a vast expansion of the national airline as it seeks increasingly to build on its strong emerging status to become a global player.

Boasting an airport twice the size of Heathrow and a fleet of modern aircraft, Turkey could pose a threat to struggling European airlines as well as fast growing Gulf carriers.

Key to the plans is the construction of a six-runway airport in Istanbul eventually capable of handling 150 million passengers per year.

The Turkish government has launched a tender to build the $9.4 billion airport that from 2016 would position the country to become a major hub for traffic between Asia, Europe and increasingly Africa.

“The construction of the giant airport is a clear sign telling the airlines to grow and keep up,” Emre Akcakmak, a senior analyst from Sweden-based East Capital, told AFP.

Flag-carrier Turkish Airlines (THY) is expected to make use of the opportunity by nearly doubling its fleet and expanding the destinations it serves by 50 per cent.

The airline, twice selected as the best European airline, posted a 20-per cent rise in passengers last year to 39 million.

It aims to reach 46 million passengers this year, generating a turnover of $9.7 billion.

However it badly needs the new airport as Istanbul’s two current airports are nearly stretched to capacity.

THY is widely expected to add to its fleet of 204 Airbus and Boeing planes by placing an order for about 150 new fuel-efficient aircraft, securing a place among the world’s top 10 airlines.

Banking on its location

That would allow the airline to expand the number of destinations it serves to 300 by 2020, banking on its location at the crossroads of Europe and Asia, as well as good access to Africa.

“We are making superb use of an excellent geography. We can fly most places in profitable, narrow-body single-aisle planes,” company CEO Temel Kotil told AFP.

That shows in its operating margin. A key factor of profitability for airlines is the amount of seat capacity offered, and the percentage of those seats occupied.