«Turkish Airlines is conducting feasibility studies for the Airbus A321 LR and XLR»

Turkish Airlines has ordered 220 new aircraft with Airbus in December. You also secured options for a further 120 aircraft back then. What does it take for Turkish Airlines to exercise these options and in what time frame do you see this happening?
Ahmet Bolat: We have procured a total of 95 A350-900s and -1000s, 20 of which are optional, a total of 250 A321 Neos, 100 of which are optional, and a total of 10 A350 Fs, 5 of which are optional. Regarding the optional orders, we will decide in three or four years, depending on market conditions.

You are currently in discussions with Boeing for another order of 150 Boeing 737 Max and 75 Boeing 787. You stated that the outcome lies with CFM International which still asks too much for the Max engines. How far apart are you concerning the price and are you confident you can solve this problem?
In our ongoing negotiations with the aircraft manufacturers we want to maintain the cost structure to ensure our business model aligns with our ten-year strategic plan. It is critical and of great importance to us to secure competitive prices for the aircraft required. We believe that Turkish Airlines will be able to get the required fleet at the targeted price.

You seem to place two similar sized orders with both big manufacturers. Why?
As Turkish Airlines, we have been working with two major aircraft manufacturers since the very beginning of the company. We want to minimize the risk by dividing it in achieving our strategic goals in the long term. Supply chain problems continue for many manufacturers after the pandemic. After the pandemic, demand in the sector cannot meet the supply. Engine problems also persist, leaving many aircraft grounded. Acquiring aircraft from both manufacturers provides an airline several advantages, including operational flexibility through a diverse fleet suitable for various routes and demands, reduced dependency on a single manufacturer for maintenance and parts, and mitigated risks associated with manufacturer-specific issues.

As you stated recently, you are not interested in the Boeing 777X for the time being. Why?
We see that the Boeing 777X has many advantages in terms of being the world’s largest twin-engine aircraft, seat capacity, low fuel costs, and passenger experience. However, we are also aware of its disadvantages, such as the fact that it is not yet available and the delays in delivery. We take into account all factors, conditions, advantages, disadvantages, and whether it is suitable for our operations. This assessment is ongoing.

How much of the two big orders is destined for replacement of older aircraft and how much for growth? 
There are currently a total of 457 aircraft in our fleet, 95 of which are at Ajet. In order to renew and expand our fleet, we have ordered a total of 355 aircraft from Airbus, of which 230 are firm and 125 are optional. We are also in negotiations with Boeing for an additional 225 aircraft. Additionally, due to the engine problems with the Airbus A320 Neos and A321 Neos we continue to lease aircraft in addition to factory-delivered aircraft. We have a goal to reach 813 aircraft by 2033 (inc 200 AJet fleet). As part of our strategy to increase the number of new generation aircraft in the fleet to 100 percent by 2028 at Ajet and to over 90 percent for the group by 2033.

Could Turkish Airlines also add smaller aircraft for regional flights, like the Embraer E2 or Airbus A220? You once stated that you were in talks with Embraer about the E2 jets but no order has been placed yet.
Regional jets seem to have advantages in some respects, but they also have disadvantages. They have particular drawbacks when engine problems are considered. Although they appear advantageous for short-haul routes, engine issues can negate this benefit. For these reasons, we have not yet made a clear decision.

Is your need for aircraft now saturated or will we see more orders in the nearer future?
As you know, our negotiations with Boeing for 150 Boeing 737 Max and 75 Boeing 787 aircraft are ongoing. Except for these, we do not plan to place large orders in the near future.

What role will the Airbus A321 XLR play in your strategy?
We are currently conducting feasibility studies for the use of Airbus A321 LRs and XLRs. However, we predominantly use wide-body aircraft for our long-haul and transatlantic flights. Our diverse fleet enables us to reach almost any destination without difficulty.

You have mentioned the engine troubles several times. How does this affect your fleet?
We are continuing to lease new and old generation aircraft to replace the A320 Neo aircraft that are grounded due to engine issues. This leasing will continue in the near future.

You will use your A350-1000 for starting nonstop flights to Australia. Do you have other ultra-long-haul destinations in your plans, for instance in South America?
At the end of 2023, we have ordered 355 Airbus jets, 125 of which are optional, 15 of these are A350-1000 aircraft. We will start direct flights primarily to Australia with these aircraft that will join our fleet at the end of 2026. Apart from that, as you mentioned, we also have plans for other destinations. As aircraft are procured, we will increase our presence in ultra-long-haul routes according to fleet and market availability. We currently have plans for both South America, and the Far East also.

Where in the world do you still see white spots where you want to expand to?
We will increase our market share in growing markets. The Asian market is expected to grow faster than other regions in the upcoming period. We will strengthen our position in the Asian market by increasing our own capacity and through partnerships with other airlines. In the Far East, we will introduce a second bank with midday round-trip flights. We have started flights to the Australia region. Additionally, we will not only increase frequencies in the Americas but also open new routes. We plan to open more than 40 international routes across Europe, the Middle East, North and South America, Africa, and Asia. In the coming period, we aim to expand our network in the U.S. by adding destinations such as Minneapolis, Charlotte, Philadelphia, and Orlando, increasing the number of destinations in the U.S. to 20. In South America, we plan to launch routes to Lima, Santiago, and Rio de Janeiro. In the Far East and Australia, we are planning to open destinations such as Sydney, Phnom Penh, and Atyrau.

Who are your strongest competitors – is it more European Airlines or more the Gulf carriers?
We are one of the most prestigious brands of the global aviation industry. On the other hand, due to our market structure, we are one of the best airlines in the world providing connections on the east-west, north-south axis. In this context, considering our service quality and market structure, I think we are more similar to the Gulf carriers.

In the cargo business, Qatar Airways and Emirates are considerably bigger than you. Turkish Airlines is number seven in the world. How do you want to grow?
Through its operations at Europe’s largest air cargo facility, Smartist, our successful air freighter brand Turkish Cargo captured a significant share of the accelerated e-commerce growth in the second quarter of this year. Additionally, it provided a major alternative for shippers who did not want to be affected by the disruptions in the Suez Canal. As a result, Turkish Cargo increased the amount of cargo carried in the first six months of 2024 by 32 percent annually and became the third-largest air cargo carrier in the world, as reported by IATA figures. We aim to maintain among the top three airlines in terms of market share and service quality in the cargo sector. Therefore we recently announced an agreement with Boeing for four 777 F aircraft. We also want to increase the share of special cargo in cargo revenues from 37 percent in 2023 to 55 percent by 2033. We plan to create a cargo ecosystem with partnerships, e-commerce, and technology investments in the cargo sector. We are also continuing other projects in the cargo field. With our Widect subsidiary, which we established in September 2023, we aim to increase e-commerce volume by providing added value to both our country and our stakeholders by offering all logistics services in an integrated manner.

What role will Ajet play in your growth plan?
Aligned with Turkish Airlines’ ten year vision, Ajet, now operating independently, will strengthen its position in the low cost market and drive our overall corporate growth. By 2033 it aims to expand its fleet to 200 aircraft to support its ambitious growth targets. This expansion will include modern, fuel-efficient aircraft that will enhance operational efficiency and reduce environmental impact. Through innovative initiatives and strategic expansions, AJet will greatly contribute to our goal of achieving sustainable and robust growth across different regions and market segments. While Turkish Airlines brings premium tourists from short, medium and long distances to Türkiye, AJet aims to bring tourists with limited budgets from Europe and the Middle East to Türkiye. It is very important for Ajet to be able to cope with its competitors especially in Europe and the companies working with low cost logic. To contribute this, we aim to make our capital, where Esenboga Airport, one of the Ajet’s hubs located in, the third largest tourism city in Türkiye with the marketing strategy covering 15 cities within a three hour drive from Ankara. To do that we aim to host five million foreign tourists and 5 billion dollars in revenue in Ankara in the next 5 years with our collective efforts.

But can Ajet compete with Pegasus who are very strong at Sabiha Gökçen and have a very low cost base?
Operating as Anadolujet under Turkish Airlines since 2008, Ajet became a separate company and now owns its AOC to enhance its market position. Functioning as an entirely separate company, Ajet is positioned to become a significant player in the low-cost carrier sector, allowing it to compete more effectively on a global stage. Our long-term growth will be anchored around the Sabiha Gökçen hub. Ajet aims to grow its fleet from 95 aircraft to 200 new-generation, fuel-efficient aircraft by 2033. This strategy focuses on reducing unit costs and increasing revenues, with a strong emphasis on international routes, aiming for a 7 percent international capacity ratio by 2028. Additionally, Ajet is investing in digital transformation with a new passenger service system to optimize fare management and increase ancillary revenues. With these strategic developments, including an expanded fleet, enhanced digital capabilities, and a stronger international focus, Ajet is well-positioned and maintains a robust market presence at Sabiha Gökçen Airport.

How important is Sun Express for you?
Sun Express has been making an extraordinary contribution to Turkish tourism for over 30 years and has become an integral part of the Turkish aviation industry. It is one of our most efficient subsidiaries in terms of performance. With a focus on growth, we have full confidence that Sun Express will continue this strong performance in the future.

Many airlines are expanding through investments in airlines. Is that something you consider, too?
Given the frequency restrictions in some markets and the enhanced competitive strength achieved through collaborations with partner airlines in joint markets, it has become inevitable for Turkish Airlines to engage in partnerships and collaborations with other airlines. Therefore, we are committed to deepening our existing partnerships and pursuing joint venture-like initiatives that will increase our market share and competitive edge. 

Your hub Istanbul when it opened was huge, now it’s already well filled. Can you grow to 800 aircraft with this hub or does it need to expand?
Istanbul Airport, key transfer hub in its region, with its infrastructure, technology, and high-level air travel experience, has played a pivotal role in elevating Turkish aviation to the next level with its performance during the pandemic and normalization. It also continues to be a significant center for rapidly increasing cargo transportation in global trade. For Turkish Airlines, the issue is not just about having space to park the planes, but also the total number of take off and landing that can be performed per hour, meaning the operational capacity. The hourly landing and takeoff capacity at Atatürk Airport, initially 70, increased to 80 with Istanbul Airport, then to 90, and reached almost 110 with the addition of a third runway. If this airport had not been built, we would not have been able to reach even our current fleet size due to capacity constraints. Istanbul Airport, serving its passengers with a main terminal building covering 1.4 million square meters under a single roof, currently has an annual capacity of 90 million passengers. Thanks to its large area, modern facilities and high-tech infrastructure, it can serve a large number of aircraft at the same time and manage heavy air traffic. 

You only offer two classes. This is rare nowadays. Why don’t you want to re-introduce a premium economy cabin – after all many airlines see a strong demand especially after the pandemic and haven’t seen a negative effect on the business class bookings since introducing premium economy.
While 26 percent of the world’s aircraft have premium economy seats, their share in total seats is 5 percent. North American airlines offer approximately 70 percent of these seats. 

And what about First class? Is that something you could offer in the future?
We observe that the number of first class seats decreased by 4 percent in the seat configuration projects carried out after 2019. Here, there is a shift especially to business and premium economy seats. We know that the number of business first class seats will be reduced in the seat projects to be carried out in the coming period. So we do not plan to offer First Class in the coming period.

Where do you want to invest in the coming years in the cabin and passenger experience?
As Turkish Airlines, we are planning to enhance the cabin and passenger experience by upgrading seats for more comfort and privacy. We just recently have announced a completely new business class product. We will also improve in-flight entertainment and internet connectivity. Currently, we offer connectivity across 86 percent of the fleet and aim to offer it on all aircraft  within the next few years. We are continuing our efforts to offer faster and free internet service to all our passengers with the retrofit conversions in our current fleet. We also aim to provide personalized experiences with enhanced meal options and services. Premium lounges at major airports will be upgraded with better amenities.  And we will open new international lounges. Of course we also invest in digital enhancements which include better mobile apps, website functionality, and self-service kiosks. 

And what about profitability in this growth trajectory?
We have just disclosed our results for the second quarter. We increased our passenger capacity by 7.7 percent, carrying 22.1 million passengers and recording a profit from main operations of 591 million dollars. Despite ongoing global geopolitical tensions, bottlenecks in aircraft production, and engine problems, Turkish Airlines continued its growth uninterruptedly thanks to its agility and extensive flight network. According to data published by the International Air Transport Association Iata, while global passenger capacity in the second quarter of 2024 has just reached pre-pandemic levels, we exceeded 2019 passenger capacity by 38 percent as one of the leading airlines in the industry amid intensifying competition. Aiming to expand our fleet to 800 aircraft by 2033 as part of our 100th anniversary strategy, we increased our number of aircraft by 9% percent in the first half of the year to 458 despite bottlenecks in the aircraft production. Employing approximately 92 thousand people along with its subsidiaries, Turkish Airlines proudly represents our nation in the global air transportation industry with its unique flight network, modern fleet, superior service, and successful performance. In the coming years, our contribution to sustainable growth in the aviation sector will continue in line with the national development objectives and our 2033 strategy.