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The Turkish government’s efforts aiming at setting a ceiling price on domestic flights may prevent the good progress in the country’s civil aviation since 2003 when a number of steps were taken to liberalize the sector, said the chairman of local low-cost carrier Pegasus, Ali Sabancı.
“Turkey’s civil aviation has broken records for good for the last decade. Some interventionist moves, like setting a ceiling price on flight tickets, will harm the sector, I believe,” he said.
Turkey's Minister of Transportation Binali Yıldırım announced earlier that the General Directorate of Civil Aviation had created an average price by examining the existing prices on domestic flights over the last year.
“We have already completed our talks with the airlines. Now we are about to announce the final word. The new rules will be applicable just after the Feast of the Sacrifice,” Yıldırım added.
The plans have led to heated discussions. Sabancı pointed out that the average flight price was 97 Turkish Liras in 2002, just before the liberalization moves in the sector.
More competition good for customers
“It is now 132 liras despite the dramatic hikes in composite inflation rates and oil prices thanks to the rise in competitiveness in the sector. Pegasus tickets are around 97 liras on average,” he said.
Turkey’s civil aviation has grown around 25 percent on average for the last decade, reaching 32 million passengers in 2012. The sector needs more liberalization, rather than the opposite moves, Sabancı said.
“We couldn’t see a parallel enormous growth in foreign flights due to the obstacles preventing high competition here. When Pegasus got started its Istanbul-Bishkek flights, the Turkish Airlines (THY) had sold the tickets for this router for 600 euros. After our flights had begun, they decreased the price down to 365 euros,” Sabancı said, adding that they set the price as 280 euros. Ticketing operations are made by some special software as the occupancy rates are on rise, said Sabancı.
“If you buy your ticket just one day before your flight, you’ll pay much more than you would have paid a month earlier. It’s the same for hotel room prices,” he noted, adding that 38.5 million guests of Pegasus, 73 percent of the total, flew for lower than 100 liras in 2013.
“26 percent of our all guests flew for lower than 50 liras. Flight tickets are the fastest consumed goods of the world, without a shelf-life,” he said. Hurriyet Daily
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