TBY talks to Akbar Al Baker, Chief Executive Officer of Qatar Airways, on links between Qatar and Turkey.
TBY How does the increase in passenger services between Doha and Turkey with the new Ankara flights improve bilateral trade between the two countries?
AKBAR AL BAKER Qatar and Turkey enjoy very strong economic and political relations, and over the years trade between the two countries has grown from strength to strength. The Republic of Turkey is one of the most vibrant economies in the world, similar to Qatar, and we as an airline no doubt contribute to this growing commercial exchange.
Bilateral trade between the two countries increased dramatically from $21 million in 2000 to over $1.2 billion in 2008 and the aim is to boost commercial trade even further to $10 billion by 2015. More than 25 Turkish companies have projects worth over $8.3 billion in Qatar, including interests in the New Doha International Airport, which is due to be completed in 2012.
What is your passenger load factor on the Doha-Istanbul/Ankara routes?
Qatar Airways started flights to Istanbul in 2004. In only seven years we have succeeded in expanding our capacity to daily flights between Istanbul and Doha and also operate two freighter services per week. In April 2010 we launched four flights a week to Ankara, our second destination in Turkey. Due to the strong demand on the route, we quickly upgraded the service to the Turkish capital to daily flights and are planning to increase the frequency even further. We currently enjoy excellent load factors on both routes.
What portion of passengers use Doha as a hub to travel to Asia and Africa?
Qatar Airways flies 94 aircraft to 95 destinations across six continents worldwide via its Doha hub. Located at the crossroads between East and West, North and South, Qatar Airways has established itself as a major gateway for international air transport, and in general around 80% of our passengers transit in Doha. From Turkey the majority of our passengers head to destinations we fly to across the Middle East, Africa, South Asia, and the Asia Pacific.
In your estimates, what percentage of passengers travelling between Qatar and Turkey are business travelers?
Qatar Airways serves leisure and business travelers alike and has invested heavily in marketing to both segments. Of course, the corporate travel segment brings bigger revenues, so we place a strong emphasis on this demanding clientele, but we do not ignore our high-volume leisure traffic. Our passenger mix is drawn from individual business travelers, independent leisure travelers, groups, and conference and incentive traffic. Turkey and Qatar have excellent trade links so it comes as no surprise that the majority of our Turkish passengers who arrive in Doha are business travelers. In Qatar, many Turkish construction companies do business, and the high percentage of corporate travel reflects the strong ties between the two countries.
How are you trying to develop Doha as a hub for international travel and freight?
Qatar Airways Cargo has significantly ramped up its expansion in the past year with the introduction of two brand new Boeing 777 freighters, adding capacity to the airline’s dedicated cargo network. Doha-based Qatar Airways Cargo provides freight services to over 95 destinations worldwide using the cargo space available on Qatar Airways’ passenger aircraft fleet, as well as a dedicated network operated by its Airbus A300-600 and Boeing 777 freighter fleet. The airline’s cargo operation is spread across six continents, thus providing a global reach. Qatar Airways Cargo has dedicated staff and facilities to ensure all trans-shipments are processed in an efficient and seamless manner. Trans-shipment facilities are used for products requiring special attention like perishables, high-value commodities, and live animals. Its warehouse at Doha International Airport has the capacity to handle around 400,000 tons of cargo annually.
The opening of New Doha International Airport (NDIA) will place Qatar Airways Cargo—already an efficient and reliable cargo operator—in a very strong position as a formidable regional and global cargo carrier. NDIA is scheduled to be operational from 2012. Qatar Airways Cargo’s 1.3 million ton capacity facility will have one of the world’s most advanced and sophisticated handling systems and will elevate Qatar Airways Cargo onto a new level.
Is Qatar Airways expanding freighter services to Turkey?
We currently operate two freighter flights from Turkey to Qatar each week, but would like to expand our cargo business to offer existing customers more options and convenience. Due to the high economic activity between Turkey and Qatar, there is high demand for additional cargo operations to cater for this growing segment. We recently set up a dedicated cargo team in our Istanbul office and look forward to hopefully increasing capacity at some point in the future.
How did Qatar Airways respond to the global economic crisis and rising fuel costs?
Qatar Airways is one of the most efficient airline operators in the industry, and we are also based in one of the most economically robust regions in the world, and so we were largely unaffected and even managed to expand during the period of the global economic crisis. While other airlines cancelled aircraft orders, shed capacity and laid off staff, we did the exact opposite. We continued to grow in line with our aggressive expansion strategy.
It was an opportunity for Qatar Airways to push its advantage in some key markets and we were also pushing for the early delivery of new aircraft. Of course, we needed to tighten our belt through this period during which the industry faced a number of challenges, including the H1N1 outbreak, a drop in international passenger traffic, and a dramatic increase in the price of fuel. Similar unforeseen circumstances have occurred in 2010 with the ash cloud crisis and the poor weather closing airports and affecting flights across Europe and the US in December.
Qatar Airways is fortunate in that it has relatively low operating costs compared with most legacy carriers. The airline’s employee to aircraft ratio is well managed. We are not unionized so do not face problems of industrial action that other airlines face in other parts of the world such as Europe and North America. Also, one of the hallmarks of Qatar Airways’ success has been our ability to shift capacity according to demand, meaning we are not flying empty seats when a route is underperforming, and we add capacity where possible when a route exceeds expectations.
How do you see Istanbul developing as a hub for the region?
Istanbul lies at the crossroads of Europe and Asia, and with its huge catchment area and economic potential, it is already an important hub for air travel. Istanbul is a great destination to fly to as it also offers huge potential from a tourism perspective. This translates into a well-balanced mix of leisure and business travelers, and we are extremely happy with that as we don’t rely heavily on one particular travel segment.
© The Business Year