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“The periods of unpaid leave are supported by a short working allowance in Turkey for 3 months and differing levels of governmental support is provided for our operations in other countries,” Sener said.
TAV operates five airports in Turkey. It also operates airports in Saudi Arabia, Tunisia, Georgia and Northern Macedonia.
TAV said on May 6 that it has signed a share purchase agreement to buy Almaty International Airport, seen as the main aviation gateway into Kazakhstan.
Passenger traffic and revenues at Istanbul Airport, seen as a pet project of President Erdogan that aims to become the world’s biggest international flights hub, have been decimated by the COVID-19 outbreak and, as noted by Mustafa Sonmez writing for Al-Monitor, “IGA, the company operating the airport, is saddled with a hefty foreign loan debt and is supposed to pay the state 886 million euros ($962 million) in annual rent”.
Built under a private-public partnership, Istanbul Airport got off to a difficult and delayed start after a construction process dogged by the deaths of dozens of workers and the criticism of environmentalists. Its rent payment was already deferred last year. However, the government has given IGA, a consortium seen as close to Erdogan, passenger guarantees, meaning it will pay the difference if the number of departing passengers falls under the figure guaranteed in the contract.
Such a prospect seems inevitable. Turkey’s passenger data from March showed the country’s aviation sector handled only 7.3mn passengers as travel restrictions were introduced to fight the pandemic, down from 12.3mn in February and nearly 14mn in January.
April, a month which saw what remained of Turkey’s international and domestic flight schedules cancelled, must have been a whole lot worse. The data also showed that the number of passengers in March decreased 30% from February on domestic flights and 54% on international flights. The latter served only 2.5mn people.
Flag carrier Turkish Airlines' domestic flights have been grounded until May 1 and international flights until May 20.
“IGA,” added Sonmez, “said it served 55 million passengers last year after the airport became operational April 6. But, with the sharp downturn since March, the company appears unlikely to hold on for even a few months without assistance.”
Turkish Airlines has rapidly grown its fleet and number of foreign destinations. Last year, the Turkish aviation sector handled 209mn domestic and international passengers, a 536% increase from 33mn in 2003.
Turkey’s State Airport Authority has yet to announce a crisis package for airport operators and airlines hit by the impacts of the pandemic. It continues to charge aircraft parking fees and rent from grounded companies.
“The Civil Aviation Directorate, meanwhile, has announced only a 50% discount on licensing and renewal fees. Other facilities include a regulatory change allowing for the leasing of grounded planes and a one-year deferral of compensation payments to passengers. Obviously, the industry remains unsatisfied, expecting more far-reaching measures,” said Sonmez.
Turkish Airlines is working on a gradual resumption of flights from June
and a scheme that would mean it taking four months to return to near full operation, a draft plan seen by Reuters showed on May 6.
61 TURKEY Country Report June 2020 www.intellinews.com
