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Cablegate: Airlines Expect Drop in Bookings/Profits with Iraq

This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS ANKARA 001203

SIPDIS


SENSITIVE


STATE FOR EUR/SE, EB, EB/TRA
ROME FOR FAA
PARIS FOR TSA


E.O. 12958: N/A
TAGS: EAIR ASEC PREL TU
SUBJECT: AIRLINES EXPECT DROP IN BOOKINGS/PROFITS WITH IRAQ
OPERATION


1. (SBU) Summary. Turkish Airlines (THY) and Delta Airlines
Istanbul Office are concerned about the impact of a potential
Iraq war on their operations. THY expects that bookings on
flights to the U.S., Europe, and the Far East, as well as
domestic flights, will drop considerably. Delta is preparing
for a possible shut-down of its Istanbul office. Both
airlines expect a decrease in profits for their Turkey
operations in 2003. End summary.


2. (SBU) Head of Marketing for Turkish Airlines Guliz Ozturk
told econoff February 20 that THY expected a significant
decrease in international and domestic operations due to a
possible Iraq operation. THY is currently running 10 flights
per week to the U.S. -- 7 days a week to New York, and 3 days
a week to Chicago. Ozturk said she expected that travel by
Turkish nationals to/from the U.S. would not change
significantly, but other tourism and business travel could
drop considerably. THY hoped it would not have to cut any of
its U.S. flights, but would reevaluate its decision based on
bookings. Ozturk expected that flights to and from the Far
East would take the biggest hit, noting that THY already had
decided to cut its Japan flights from 7x/week to 4x/week.
She said THY also anticipated a significant drop in bookings
on THY,s European flights, with the exception of travel by
Turkish nationals to/from Germany.


3. (SBU) Ozkurk said THY was also concerned about its
domestic operations to the eastern and southeastern Turkey,
particularly to Adana, Diyarbakir, and Erzerum. She noted
that it would be difficult, if not impossible, to keep
aircraft and crews overnight in these cities once an
operation began. Ozkurk said the likely negative impact on
THY,s profits was particularly distressing given the
airline,s efforts in 2002. Despite 9/11, increased
insurance costs, and an economic crisis, 2002 had been THY,s
most profitable year since 1996. An Iraq operation would
make it difficult to achieve such profit levels again in
2003.


4. (SBU) Delta Airlines Istanbul Station Manager Giray
Salgirtay told econoff he was preparing for a possible
shut-down of the Istanbul office in the case of an Iraq
operation. Salgirtay noted that Delta currently runs four
flights/week from Istanbul to New York. Although he hoped
flights would continue at the current level, it was likely
they would decrease -- or cease -- at least temporarily
during an Iraq operation. Salgirtay noted that, prior to
9/11, the Turkey office had been one of Delta,s most
profitable international operations. However, business had
decreased due to September 11 and the subsequent war in
Afghanistan, causing the Turkey operation to barely break
even in 2002. Salgirtay said that most summer tours and
cruises booked from February to April; therefore, he soon
would have a better idea of how concerns about an Iraq
operation would affect bookings.
PEARSON

© Scoop Media

 
 
 
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