Ceiling prices can’t protect customers, Pegasus chairman says

MOSCOW – Doğan News Agency

Pegasus Chairman Ali Sabancı delivers a speech during a meeting.

Creating competition is more effective at protecting customers from high prices than imposing ceiling prices for flight tickets on domestic lines, the chairman of low-cost Turkish carrier Pegasus, Ali Sabancı, has said.

“I understand very well what the ceiling price regulation is for and I support it totally. When demand is too high, prices increase. Airline companies can abuse this, with prices between 400 and 600 Turkish Liras. But the way to prevent this is to create competition,” Sabancı said during a press meeting in Moscow over the weekend.

He stated that there was still a monopoly in one key domestic line in Turkey. “There is only one player in the line between Istanbul Atatürk Airport and Ankara Esenboğa Airport. This player sold tickets from 490 liras. The only way to overcome this is to allow three of four airline companies to operate this flight line. Customers will benefit from this,” he said.

Turkish Airlines is currently the only carrier that makes flight from Istanbul Atatürk Airport (on the European side of the city) to Ankara. Pegasus has been seeking to operate flights on this line and promises to decrease flight ticket prices by 50 percent, Sabancı added. Other carriers can currently operate flights from Istanbul Sabiha Gökçen Airport (on the Anatolian side) to Ankara.

The Ministry of Transport’s Directorate General of Civil Aviation (SHGM) has arrived at an agreement on a ceiling price for flight tickets on domestic lines with airline companies after negotiations. The maximum price has been determined at 300 liras, without any exceptions for holidays and special days. The draft, which will be submitted to Transport Minister Binali Yıldırım, will not put any limits on business class ticket prices on domestic lines or any tickets in international lines. The new regulation is planned to be launched within two weeks.

Meanwhile, Pegasus started operating Istanbul-Moscow-Istanbul flights on Oct. 8, thus increasing its destination number in Russia to four.

“We have currently 45 planes in our fleet. We are flying to 76 points in 30 countries,” Sabancı said.