Turkish Airlines

Natural resources and economic growth draw Turkish Airlines to Africa

Turkish Airlines’ bullish African expansion plans will see the carrier launch service to several destinations in 2012 and upgrade many existing routes to twice daily. The carrier’s focus for 2012 is on expanding in emerging markets, primarily Africa, as further network expansion in the US is on hold and plans for launching service to Australia will likely not materialise until at least 2013.

Turkish currently operates 18 destinations in Africa, including Misrata in Libya which was launched in Dec-2011. Turkish CEO Temel Kotil told CAPA in Dec-2011 that the carrier plans to launch in 2012 Abuja and Kano in Nigeria; Kigali in Rwanda; Abidjan in Cote d’Ivoire; and Mogadishu in Somalia.

The carrier has since also announced plans to launch in 2012 Kinshasa in The Democratic Republic of the Congo, which could give Turkish an African network of 24 destinations by the end of this year.

Poland’s LOT and Turkish Airlines highlight Eastern European flag carriers investor/seller shortfall

Several Eastern European flag carriers are clearly struggling as competition in their markets, particularly from low-cost carriers, continues to increase, threatening their survival as independent entities. Many of these carriers are reliant on regular capital injections from their respective governments simply to maintain operations. In an effort to ensure their long-term survival and a more sustainable future, several are seeking to secure strategic partners in 2012.

Being acquired by, or partnering with, larger airlines from Turkey and the Middle East is proving to be the most likely of scenarios for these Eastern European operators as Western European airline groups are attempting to reduce expenditure significantly in 2012. While Turkish Airlines and the three major Gulf carriers have the cash and interest to pursue investments in Eastern European carriers in 2012, such investments do not appear to be on the radar at all for Western airlines.

Small capacity with regular frequency key for Turkish Airlines strategy to Africa, and perhaps India

In an interview with CAPA, Turkish Airlines CEO Temel Kotil expanded on the airline’s strategic decision to deploy a specially configured sub-fleet of B737-900ERs on many African routes, primarily in the central and western region of the continent. The strategy could be expanded to Central Asia and India, Mr Kotil says.

He said that while Africa is a very good market for carriers – including Turkish – the seat demand is small and carriers have responded by offering limited frequencies on large aircraft able to span the distances involved. While non-stop long-haul passenger comfort is maintained, sporadic flights have meant that travellers have had to tailor trips to the airline's schedules rather than to their actual needs.

Europe-Africa routes heavily concentrated across a few points

Africa, once carved up by European powers, retains air links reminiscent of those historic ties. Even so, in too much of the continent, service remains spotty. The CAPA routes tool breaks African searches into four categories: North, South, East and West/Central. But in terms of seat offers available, the real division is between North Africa, those countries bordering the Mediterranean – and everything else. This examination will utilise this format, beginning with everything else.

Turkish Airlines deeply in the red in the first half on exchange rate losses and fuel costs

Turkish Airlines (THY) in 1H2011 had one of its worst half-year performances in the past decade. The airline sunk deeply into the red in the six months to 30-Jun-2011. THY, one of Europe’s largest and fastest growing carriers, was hit by by a weakening local currency increasing foreign exchange losses, particularly on its majority-leased fleet, as well as the soaring price of fuel in 1H2011.

Emirates and Lufthansa growing strongly this summer: World's biggest airlines rankings for August

Lufthansa and Emirates are the fastest growing carriers of the global top ten, increasing their capacity (ASKs) by 12.4% and 8.1% year-on-year, respectively. Delta remains the world's leading carrier by this measure, followed by American Airlines and United Airlines. Combined, United-Continental is roughly 3.3% bigger than Delta by systemwide ASKs.