Turkish Airlines Sees Passenger Numbers Rising 29%

Turk Hava Yollari (THYAO) AO, the national carrier known as Turkish Airlines, expects passenger numbers to increase 29 percent to 18 million travelers in 2006 after adding flights, Chief Executive Officer Temel Kotil said.

Plans to join Star Alliance, the world's biggest grouping of airlines, will probably help traffic rise further next year, Kotil said in an interview in Istanbul today. The carrier handled 14 million passengers in 2005.

Turkish Airlines, which flies to 131 destinations in Turkey, Europe, the U.S. and Asia, has added routes to help increase earnings and stave off competition from low-cost carriers in its home market. The Istanbul-based airline has increased capacity 30 percent this year, and plans a slower growth rate in seating in 2007, Kotil said.

The carrier will join Star Alliance within a year after negotiating with the 18 current members on issues such as ticket pricing, this said. Turkish Airlines began talks last month with the group, which is led by UAL Corp.'s United Airlines, the world's second-biggest carrier, and Deutsche Lufthansa AG (LHA), Europe's second-biggest.

Alliances help airlines boost sales by feeding passengers to each other's networks and cut costs by enabling joint purchases and use of common ground facilities.

``With Star Alliance, we will expand to 700 routes, and this will bring a price advantage,'' Kotil said. ``It is a one-year process, one month past, and it will be completed around this time next year.''

Star Alliance member CEOs, all of whom would need to approve Turkish Airlines' membership, meet twice a year, usually in June and December.

``We're having constructive talks, and we expect to come out with a joint statement in the not-too-distant future,'' said Markus Ruediger, a Star Alliance spokesman in Frankfurt.

The group's carriers will benefit from Turkish Airline's contribution as ``the bridge between East and West in the southern perimeter,'' Ruediger said. ``And it gives us access to the domestic Turkish network.''

Turkish Airlines was a member of the now-defunct, Swissair- led Qualiflyer alliance in the late 1990s along with Austrian Airlines Group, Poland's PLL LOT SA and Portugal's TAP SGPS SA. Those carriers are now all Star Alliance members, including Swissair's successor, Swiss International Air Lines Ltd.

Star Alliance estimates that its market share totals more than 30 percent of the world's traffic after the group added Swiss International and South African Airways last year.

Air China and Shanghai Airlines Co. will be integrated into Star Alliance over the course of 2007, Ruediger said. The group also aims to add members in India and Russia.

``There are very few companies left outside such groups,'' Kotil said. ``All European airlines in the scale of Turkish Airlines are a member of a group.''

To contact the reporters on this story: Seda Sezer in Istanbul at ssezer2@bloomberg.net; Susanna Ray in Frankfurt at sray7@bloomberg.net.

To contact the editors responsible for this story: Malcolm Fried at mfried@bloomberg.net; Dan Stets at dstets@bloomberg.net.

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.