Turkish Airlines chief puts focus on organic growth

Singapore
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Turkish Airlines chief executive Temel Kotil is putting the focus on organic growth as the airline continues to revamp its network following a rapid expansion of its long-haul fleet.

The Turkish flag carrier has distanced itself from recent speculation linking it with interest in taking a 49% stake in fellow Star Alliance carrier Spanair, saying it had not met executives at the Spanish carrier and nor had its board made any decision on the subject. Kotil told Airline Business at the recent IATA annual general meeting in Singapore that the airline's preference is for organic growth rather than consolidation.

"We are not against consolidation, but consolidation is a multi-hub strategy, and that is the last thing you are supposed to be doing," he said, noting it makes sense in markets where carriers do not have the opportunity to keep growing on their own.

"We don't need to compromise because we are growing already. For us, organic growth and market share is the healthiest way [to grow], so we have the product," Kotil says, but he adds: "If there is a strategic move, if there is an obvious opportunity, we are there. Money is no problem: we have enough cash."

The airline's own rapid growth has continued apace. It grew rapidly and profitably through the recent economic crisis and Kotil expects it to continue to expand profitably this year. The Star Alliance airline expects to carry 34.8 million passengers this year, more than doubling the total in five years. Its expanded fleet will reach 184 by year end.

"We are the 25th largest carrier in terms of flights, but in terms of destinations we are the eighth largest," he says, pointing to the rapid expansion of its network. "Our network built up with the narrowbodies and making money from the short routes is the hardest thing," he says.

But much of its recent expansion has come in the long-haul segment. It now operates a mix of 35 Airbus A330s, A340s and Boeing 777 widebodies, and is refining its network to reflect the growing mix of long and short-haul routes.

For more on Turkish Airlines, read our cover interview with Temel Kotil from 2008