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Turkish Airlines grounded before launch as Minister delays air rights

Ayesha de KretserSenior reporterJul 23, 2023 – 4.04pm
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KEY POINTS

• Turkish Airlines wants to fly to Australia, but is yet to receive approval.
• It follows the government’s decision to block Qatar Airways from adding services.
• More flights to Europe will bring prices down for travellers as demand outpaces supply.

One of the world’s biggest airlines, Turkish Airlines, has been forced to put its plans of expanding services into Australia indefinitely on hold after it failed to win government approval in time for an expected launch of highly sought after capacity to Europe from Melbourne and Sydney.
The setback appears at odds with the Albanese government’s objective of fostering airline competition, after it knocked back Qatar’s application to send more flights to Australia. The airline plans to compete in the ultra-long haul space when it receives new aircraft. An artist’s impression of the Turkish Airlines Airbus A350-900 in the air. At a gala event in Melbourne on Friday, the chairman of Turkish Airlines, Ahmet Bolat, told The Australian Financial Review that the airline had encountered “legal issues” that stopped a formal announcement being made on the night.
“There are some legal issues that we have to solve between the Turkish government and the Australian government, but today in the meeting the [Melbourne Airport owner Asia Pacific Airports Corporation] mentioned that they are on the issue,” Mr Bolat said.
Turkish Airlines currently flies to the most destinations of any airline in the world, and had been expected to name Melbourne as the 130th at the event. Turkish Airlines has the right to land four flights a week under an existing bilateral agreement between Australia and Turkey, but Mr Bolat said the airline is trying to expand its air rights to 14 flights a week or daily services to Melbourne and Sydney.
He said Turkish Airlines also needs “fifth freedoms”, or the right to sell tickets between Melbourne and Singapore, and Sydney and Singapore, as well as the longer Melbourne- and Sydney-to-Istanbul via Singapore fares, for the service to make commercial sense. This had caused some hesitance on the airline’s part.
“In the 42 hours [that it takes to fly to Australia and back] I can fly to Miami twice. I’m sorry to say that is more profitable than flying to Sydney and Melbourne,” Mr Bolat said, on the basis that the necessary fifth freedoms are out of reach. Turkish Airlines chairman Ahmet Bolat says the negotiations are continuing. Eamon Gallagher While sources close to Qantas indicated the airline did not oppose Turkish Airlines’ expansion, the federal government did not answer questions about why it is not trying to help lower the cost of flying for Australians.
European airfares have remained stubbornly high, although somewhat cheaper than they were at their peak in 2022.
The delay comes hot on the heels of a decision by Federal Infrastructure, Transport, Regional Development Minister Catherine King to kybosh Qatar Airways’ plans to double flights into Sydney and Melbourne, a move that some sources in the industry said would have reduced the cost of flying to Europe by as much as $1000.
Ms King did not answer questions about why the Labor government has stopped two airlines from adding capacity into Europe from Australia in as many weeks, at a time when international carriers have been unable to meet demand, and capacity remains at 80 per cent to 90 per cent of pre-COVID-19 levels.
“The Australian government continues to contribute to the prosperity and wellbeing of all Australians by fostering a viable, competitive and safe aviation industry,” Ms King said in a statement.
Istanbul is a hub connecting passengers to airports throughout Europe, as well as Africa and the Americas, and Mr Bolat said he was confident that Australians could transit to most destinations in the world within two and a half hours of arrival.
“You don’t see people sleeping in our airport in Istanbul,” he said.
Mr Bolat said the airline had not yet decided whether to fly non-stop from Melbourne to Istanbul when it takes delivery of new ultra-long-haul A350s or Dreamliner aircraft, expressing reservations that anyone would want to spend 17 hours flying non-stop.
“We might continue with this stopping in Singapore even if we have the ultra-long haul aircraft if the passenger prefers that,” he said.
Mr Bolat confirmed Turkish Airlines would not receive the aircraft until after Qantas takes delivery of new Airbus A350-1000 XLR planes that have additional fuel tanks and can fly 22-hours non-stop from Melbourne and Sydney to New York and London, as part of Project Sunrise at the end of 2025.
Qantas plans to charge a 30 per cent premium for the point-to-point or non-stop flights, adding as much as $400 million a year to its earnings profile.
Victorian minister for public transport, as well as industry and innovation and manufacturing, Ben Carroll, told the 500-person event on Friday night that Turkish Airlines adding flights would expand high-valued exports, with the state’s governor Linda Dessau visiting Turkey in April to grow connectivity.
“We also know that an important part of the aircraft is underneath of it and for freight opportunities, with Victoria being the food and fibre capital, being the defence capital, being the advanced manufacturing capital, there is an enormous amount of opportunity,” he said in a speech.
Mr Carroll declined to answer questions around the federal approvals process, but said the state has been lobbying hard to secure the rights. “We’re very committed to getting Turkey and Turkish Airlines here though,” Mr Carroll told the Financial Review on the sidelines of the event.