BTN's annual answer book for business travel managers.
Turkish Airline's Bilal Eksi discusses:
On Oct. 29, Turkey plans to open Istanbul New Airport, also known as Istanbul Grand Airport, unlocking the potential for significant capacity growth to and through the Turkish metropolis. Istanbul's current main airport, Ataturk, is limited to 70 million passengers each year. The new airport's five runways will be able to handle 200 million once expansions are complete, Turkish Airlines deputy chairman and CEO Bilal Eksi said. At the carrier's Istanbul headquarters, he spoke with BTN transportation editor Michael B. Baker about the carrier's plans to transfer to the new airport, its subsequent growth plans and its recent investments in growing corporate business.
BTN: What will the new airport mean for Turkish Airlines?
Eksi: It is three times more than the existing Ataturk airport, so it will bring us more capacity. The last five years, we are facing a capacity problem in Ataturk airport. It has limited Turkish Airlines from growing more quickly. And some legacy carriers want to come to Istanbul to start operations or increase frequency, but because of the slot congestion issue, they are not able to do it. Istanbul Grand Airport will motivate Turkish Airlines to grow fast, and many legacy carriers will start operation to Istanbul. We are happy for that. We are happy to have very fair competition.
BTN: What is your plan for the transfer to the new airport?
Eksi: We have worked with a consulting company on this matter. Two days before transfer to that airport, we will decrease our capacity in Ataturk airport because we have to move some equipment to the new airport. When we start operation on the first day, our capacity will increase 10 percent, then 20 percent, and in 24 hours, we will reach 50 percent of our original capacity. And we will continue to do 50 percent for a further 12 hours, and then we will start full operations. In the initial phase, we can face some technical problems, etc., because it is normal for the initial period. We do not want to give any trouble to our customers. Maybe we will lose some money, but the money is not important. The important thing is the happiness of our passengers.
BTN: Will any capacity remain at Ataturk?
Eksi: Ataturk will be closed, only kept open for charter operations and the cargo operations and the business jet operation. Our full cargo operation will continue from Ataturk Airport maybe six months or one year. All the other operations for passengers will transfer [in a] big bank, one-day transition to the new airport. Approximately 40 percent of passengers are the transit passengers. It is not easy to transfer to the new airport. It would give trouble to the transit passengers.
BTN: What will the new airport mean for connection times?
Eksi: We have located in the central terminal. This means that the [areas] for Turkish Airlines and the boarding gates and domestic location are very close to each other, and the transit duration for Turkish Airlines will be minimized. This terminal will give us more opportunity. For example, we are constructing 10,000-square-meter lounges. It is double [compared] to Ataturk Airport.
BTN: With the room to grow, what are your future capacity plans?
Eksi: From 2003 to 2018, our average yearly growth is approximately 14 percent. Our expectation is we will catch similar growth in Istanbul New Airport. [Over] the following [six] years, from 2018, we have ordered and will [have delivered] 167 aircraft. Today, we have 328 aircraft. We will add 167 plus 50 widebody aircraft. This means that we are putting more capacity on the market, and we believe that we will catch more than the 10 percent passenger growth with the new airport. All the narrowbody aircraft will be refurbished with Wi-Fi. New [aircraft] is coming with Wi-Fi, and others in our fleet will be equipped with Wi-Fi. It will be our new standard product for Turkish Airlines.
BTN: Are there any particular markets that will be growth targets?
Eksi: Each day, our marketing people are looking for the new destinations. Of course, some of them are in Europe or Africa, but our main market is India, the second is China and the third is Canada. And of course, South America. For South America, we have an aircraft problem because our range is not capable to reach some destinations, but India and China are very important markets for us and we are looking forward to some commercial cooperation with those countries' airlines. We hope that we can declare some very good cooperation with some Indian carriers, and we are in negotiations with the Chinese airlines. Also, we are looking for the traffic rights to India, China, Canada and we hope that we will get more traffic rights.
BTN: Will you establish other partnerships, as well?
Eksi: [We have] the codeshare agreements. Now, we are flying direct to 121 countries, but we are flying to almost every country because we have the 50 codeshare agreements with the different airlines. We are reaching to 97 percent of the world's population, via the direct flight or a codeshare flight.
BTN: How was your performance last year?
Eksi: 2017 was a financial record for Turkish Airlines. We have declared operational revenue more than $1 billion. It is a last-10-years' record. We hope that we will get a new record for 2018. Generally, [through] May, the total passenger growth is more than 15 percent, which is a very good number, and our revenue is more than 17 percent.
BTN: How has the corporate business sector been performing?
Eksi: We have a dedicated corporate segment and direct SVP. In 2017 and 2018, we are hiring some people outside of Turkey, in other destinations. They are totally involved in the corporate segment. For the first time, our business class load factor has reached—and I'm talking average—more than 55 percent, which is very good. We are giving call center service to the corporate segment. We are giving to the call center service 13 different languages. We opened the corporate call center in Turkey, but now we are looking to open to another destination, especially the United States.
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