Turkish Airlines aims to spread its wings at Istanbul's giant new airport

Turkish Airlines aims to spread its wings at Istanbul's giant new airport

Turkey will fully open a new airport in Istanbul this week that will give its fast-growing flagship airline a platform to challenge Gulf rivals for regional dominance, reports Trend citing to Reuters

Authorities plan to shift flights from the city’s Ataturk Airport, on the edge of the Sea of Marmara, to the new airport 30 km (20 miles) north on the Black Sea shores, in a mammoth 45-hour transfer operation starting on Friday.

The $8 billion airport is one of several infrastructure mega-projects championed by President Tayyip Erdogan and will initially be able to handle 90 million passengers a year, a number which Turkey hopes to more than double by 2027.

That would make it the biggest in the world, measured against current airport operations globally.

“Istanbul Airport will rise to second place in terms of passenger numbers it serves in around five years,” Transport Minister Cahit Turhan told reporters in the gleaming departure hall. “When all phases are complete, Istanbul Airport will sit in the leader’s chair.”

The airport is supposed to be fully operational on Sunday after authorities transport 10,000 pieces of equipment, from massive aircraft-towing vehicles to sensitive security sensors, across the city in a complex two-day operation, after which Ataturk Airport will close for passenger flights.

The move should support Turkey’s ambition to make Istanbul a global aviation hub and will offer Turkish Airlines a chance to grow beyond the restrictions of Ataturk airport’s limited size.

After 15 years of rapid growth, the airline flies to more countries than any competitor, helped by its Istanbul base which is close to European, African and Middle Eastern destinations.

That location means many cities are within a 4-5 hour flight radius which can be flown by fuel-efficient, narrow-bodied planes. The relatively low costs helped deliver profit last year of 4.05 billion lira ($716 million).

With more slots available, the airline plans to increase its total fleet from 338 aircraft to 476 over the next four years, and analysts say it will challenge the three big regional competitors: Emirates, Qatar Airways and Etihad.

“It puts them on a level playing field with the Gulf carriers,” aviation expert John Strickland said.

However there are potential risks ahead. The airport is opening just as years of strong economic growth are grinding to a halt in Turkey, and any weakness in the domestic market could prove a drag on Turkish Airlines’ business.

Istanbul’s opening comes a decade ahead of the expansion of Dubai’s Al Maktoum International Airport to handle 130 million passengers a year, which has been pushed back to 2030.

Dubai-based Emirates will one day shift to the airport, which ultimately aims to be able to handle 260 million passengers a year. For now, Dubai plans to focus on Emirates’ current hub Dubai International, which handled nearly 90 million passengers in 2018.

The Gulf airlines already face testing times. Qatar Airways said last month it would report a second consecutive annual loss this year, after losing access to 18 Middle East destinations over a dispute with Gulf neighbors.

Emirates warned in November of tough times after first-half profit fell to its lowest in a decade, and Abu Dhabi has abandoned its goal of becoming a major air travel hub akin to Dubai.

Turkey’s aviation sector has become a “huge threat” to Gulf airlines, a senior executive at one Middle Eastern airport said, and also to rivals in Asia and Europe.

That includes Frankfurt Airport, one analyst said. It is the hub of Lufthansa, one of Europe’s largest airlines, and handled 69.5 million passengers last year. It is a roughly three-hour flight from Istanbul, slightly closer than the Gulf.

Turkish Airlines is not the only emerging rival.

Ethiopia overtook Dubai last year as a conduit for long-haul passengers to Africa, highlighting the success of the state airline’s drive to win back market share on routes to and from Africa which had been dominated by Turkish Airlines and Emirates.

Turkish Airlines has targeted fast-growing Asian economies, signing a code share agreement with India’s largest domestic carrier Indigo on December, and setting up a joint venture with China’s ZTO to extend its cargo operations.

“The upside of the new airport ... is its potential to tap Chinese, Indian and other emerging Asian markets,” said Erdem Kayli, senior analyst at TEB Investment/BNP Paribas.

The project has been plagued by delays and a protest last year over conditions for workers, after the government said 27 workers had died since construction started in 2015.

Full operations at the new airport have already been held up three times. Formally opened by Erdogan in October, it has handled fewer than 20 daily flights as the full opening was pushed back first to January, then March and now April.

The opening comes at a time when Turkey’s ties with the United States and Europe have frequently been strained. This presents another potential risk for Turkish Airlines - as Qatar’s dispute with other Arab states has shown, politics can damage a country’s carrier.

“There is uncertainty about Turkey’s relationships with other parts of the world, not least the United States,” Strickland said. “That gives uncertainty.”

The airport is one of the showcase projects of a 16-year construction boom under Erdogan, who has overseen the building of bridges, ports and railways that have transformed the country.

Some of the biggest schemes, including a planned 40-km shipping canal parallel to the Bosphorus, have been criticized as ill-conceived and wasteful.

Some analysts question whether the airport’s ultimate target of 200 million passengers a year is feasible, given the presence of a second international airport, Sabiha Gokcen, on Istanbul’s Asian side.

“It seems unrealistic to expect to reach such passenger numbers, because of airspace constraints,” said an aviation analyst at an international brokerage company who asked not to be named. “The city has another airport, and there’s a question mark whether total passenger numbers of the two airports can exceed 150 million.”

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