The freight unit of Turkish Airlines (TK) is considering corporatizing and thus becoming a separate company with an own management and full responsibility for sales and results. Corresponding schemes were confirmed to CargoForwarder Global by Turhan Oezen, Chief Cargo Officer at Turkish Airlines, during a video conference orchestrated yesterday (16JUN20) by the German Air Cargo Club (ACD).
Spinning off Turkish Cargo to becoming a separate company is a realistic option, Mr. Oezen affirmed to CargoForwarder Global when asked about the future organizational structure of TK’s freight arm. “We have set up a working group that is currently analyzing in detail all the pros and cons of becoming a separate company,” the manager stated.
But these considerations, should they be put into practice, are not related to a fixed date or time period, emphasized the communications department of the Turkish carrier.
In the Webinar, Mr. Oezen added to this, that in parallel, plans to expand the existing joint venture with China's ZTO Express and Hong Kong's PAL Air aimed at operating globally as a virtual integrator, are also being given high priority. “As a matter of fact, we are very confident that the business of this joint venture will pick up after the Covid-19 pandemic,” he declared.
Joint venture will be revived post Covid-19
Formed in Hong Kong exactly two years ago, the company called We World Express, focuses on the e-commerce market, offering customers all door to door logistics activities including trucking, collection and distribution, freight transportation by road, rail and air, cross docking, and final mile delivery. When the joint venture was kicked off, leading managers of Turkish Airlines, ZTO and PAL Air rolled out a masterplan, forecasting revenue in the region of US$2 billion within the first five years of the company’s existence. These plans, however, were thwarted by the outbreak of the corona pandemic which shocked the entire world and crippled the global business.
Touching Covid-19, the manager said that roughly 40 passenger aircraft were temporarily converted to “preighters”, operating 1,000+ flights between March and May to safeguard the supply of hygienic and medical equipment, and compensating for the loss of lower deck capacity caused by the grounding of most passenger aircraft. "We responded immediately to global phama and medical demand caused by the pandemic. Carrying masks, medicines, medical equipment and medical aid we coninue doing. From 1 February to 31 May this year, we flew more than 20,000 tons of medicines and medical equipment," stated the manager.
Freighter fleet keeps growing
Looking ahead, TK Cargo’s helmsman Oezen said that the passenger fleet will be downsized with aircraft being taken out of operation owing to the fall in tourist traffic. “I can confirm that our passenger fleet will shrink but to what extent is pending final management decision.”
The freighter fleet is not affected by any contractions. In contrast, depending on market development, it will grow by 1 to 3 units annually, adding to the existing 25 all-cargo aircraft, announced the manager.
In pre-corona times, TK Cargo had constantly expanded its global network, serving 90 destinations with full freighters.
Concentrating on high value products
Mr Oezen stressed that TK Cargo will concentrate on special products, particularly pharmaceuticals, but also perishables and other products requiring utmost care and protection. He reminded listeners that, last April, his airline became the first carrier to achieve all three CEIV Pharma, Fresh, and Live Animals certifications concurrently, under the IATA Center of Excellence for Independent Validators (CEIV) program.
“Traditionally, we are growing primarily on international routes, which we will continue to expand in the future,” Mr. Oezen stated.
Asked about the current economic crisis in Turkey and the consequences for TK Cargo, he said that the domestic market contributes only about 1/4 to the total tonnage. In 2019, the carrier transported 1.54 million tons.
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