Page 66 - TURKRptJul20

and the severity and duration of the pandemic and required travel restrictions also remain highly uncertain, particularly given the threat of an increase in the number of infections as social distancing practices ease.
The intensity and length of the pandemic and the associated travel restrictions globally have proved greater than what Moody's assumed in its base case at the time of a March 24 rating action, when it downgraded Turkish Airlines to B2 from B1. At that point, it was assumed by the rating agency that Turkish Airlines' passenger traffic would decline 20% y/y in 2020.
Deutsche Lufthansa is ​closing​ the German charter arm of its SunExpress venture with Turkish Airlines​ that carried German tourists to destinations including Bulgaria and Egypt.
The German airline announced the move on June 23 as an extension of its plan to cut costs and trim its network amid slumping demand brought about by the coronavirus (COVID-19) crisis.
SunExpress Deutschland, which operated with a fleet of 20 planes, is to shut down with the loss of 1,200 jobs. Lufthansa added that it would take over the unit’s seven Airbus SE A330 wide-body aircraft, while 11 smaller Boeing 737 jets would be transferred to SunExpress’s Turkish arm. It is to continue flying under a separate air operator’s certificate.
The surviving part of the venture is to focus on holiday flights from Germany, Austria and Switzerland (the “DACH” region) to Turkey, as well as Turkish domestic services, using a fleet of about 60 planes, including the transferred 737s.
“The company will focus on its strength in air travel into Turkey as the home carrier for Antalya and Izmir,” said Max Kownatzki, its CEO.
“We believe in a strong comeback of tourism to Turkey and in the strong, established relations between Germany, Europe and Turkey and will expand our flight schedule further over the upcoming weeks to meet demand”, Kownatzki continued.
SunExpress was founded 31 years ago as a joint venture between Lufthansa and Turkish Airlines. It is one of the leading providers of charter and holiday flights to Turkey.
In 2019, the airline posted record revenues of more than €1.4bn and carried more than 10mn passengers.
The disagreement between Austrian Post and Aras family ​began​ in 2016 when Austrian Post attempted to exercise an option to purchase an additional 50% stake in Aras Kargo from the founding Aras family. It had acquired a 25% stake in 2013​.
Aras Kargo rejected the plan at the time. Instead it proposed that it would buy back the Austrian company’s stake. Austrian Post was not the right partner for its envisaged international expansion and its staff did not want an Austrian owner, it reasoned.
Reuters reported that Austrian Post said that under the new agreement it would pay a price in the “mid double-digit million euro range”. The closing of the deal is expected in the coming weeks, subject to regulatory approval, it said.
66​ TURKEY Country Report​ July 2020 ​ ​www.intellinews.com