Turkish Airlines Targets 8% Fleet Increase In 2025

Credit: Joe Pries

Despite aircraft delivery delays and Pratt & Whitney geared turbofan (GTF) engine-related groundings, Turkish Airlines expects to operate a fleet of around 530 aircraft in 2025.

Turkish Airlines’ fleet comprises 474 aircraft at present; it is expected to increase to 493 by year-end.

On the airline’s Nov. 5 third quarter (Q3) financial results call, CFO Murat Seker said in 2025, Turkish Airlines’ fleet will grow to 530 aircraft. “There will be a mix of narrowbody and widebody aircraft, including aircraft for [LCC subsidiary] AJet and cargo operations. This is a growth of 7% to 8% for the fleet,” Seker said. “We have more visibility on this now since the Boeing strike ended, and Boeing informed us today that we will soon get an update on the delivery stream.”

The GTF issues have caused Turkish Airlines to ground 42 aircraft. “This will increase to 45 aircraft by the end of 2024; that will be the highest number of groundings,” the CFO said. Seker does not expect a big improvement with the GTF situation in 2025, though the airline reached an agreement with Pratt for compensation with payments beginning in Q3 and continuing in the fourth quarter and into the next year.

Besides increased personnel costs, the GTF issue is the company’s second biggest driver in terms of ex-fuel cost per available seat kilometer (CASK).

Asked if doing more in-house maintenance helps with supply chain issues, Seker said Turkish Airlines’ vertical integrated business model with around 20 subsidiaries allows for efficient services. “That enables us to mitigate some of the impacts,” he said.

The company’s MRO activities have become even more important as aircraft delivery delays continue. This has led to a significant increase in personnel. “It become more costly and necessary,” Seker said. Turkish Airlines is prioritizing servicing its own fleet, instead of aircraft from external third businesses.

The recovery of other airlines has led to intense competition and an erosion of Turkish Airlines’ yield. “Some softness has been seen in direct traffic, as more international airlines are flying to Turkey,” Seker said.

The airline increased its passenger capacity by 5.4% in Q3 2024, mainly driven by international traffic. It carried 24.5 million passengers in the September quarter.

Turkish Airlines’ total Q3 revenues increased 4.9% year-on-year to USD 6.6 billion. Its Q3 net profit from its main operations came to USD 1.3 billion. The company’s Q3 cargo revenues rose 47% year-on-year to USD 911 million. Turkish Airlines became the world’s third-largest air cargo carrier in September, with a market share of 5.7%. Turkish Airlines operates to 350 destinations in 130 countries.

Geopolitical Issues

During the call, Seker conveyed that military escalation in the Middle East and no signs of improvement in Russia and Ukraine continue to have a negative impact on Turkish Airlines. “In the Middle East, we operate to 40 destinations of which two—Tel Aviv and Beirut—are closed,” the CFO said. “It is hard to tell how we will be able to recover. The overall impact in Q3 is a 20% drop in capacity and a 30% drop in revenue for the region.”

Seker said the airline’s latest new long-haul destinations to Denver, Detroit, and Melbourne are performing strongly. The launch of flights from Istanbul to Sydney and Santiago de Chile should further strengthen the network. “Next, we plan Lima, Peru, for June 2025, followed by Phnom Penh in Cambodia,” Seker said.

Besides geopolitical repercussions, aircraft delivery challenges have “made the budgeting process for 2025 very complex,” Seker said. “Next year’s budget will be a difficult one to make.”