THY to buy 95 planes from Boeing

ISTANBUL

THY will not have to pay tax on this purchase as it will be exempted from the customs duties on its new purchases thanks to a recent law. Hürriyet photo

Turkish Airlines (THY), the country’s flagship carrier, has agreed to buy 95 planes from U.S. aircraft manufacturer Boeing, signing the second major aircraft deal in a month after ordering 117 planes from Boeing’s French rival, Airbus, in mid-March.

“Our board of directors has decided to buy 20 planes in 2016, 20 in 2018, 15 in 2019, 30 in 2020 and 10 in 2021 from Boeing to meet the need for narrow-body planes,” a THY statement said, adding that 70 of the orders were guaranteed, while the remainder were options.

THY ordered 20 B737-800s, 65 B737-8 MAXs and 10 B737-9 MAXs amounting to more than $9.3 billion based on their average list prices for 2012.

The announcement came amid the decision of Hava-İş union to strike against THY in order to urge the airline to rehire its 305 laid-off employees who participated in a strike a year ago. The union is expected to announce the decision to strike and the details tomorrow.

THY will not have to pay tax on this purchase as it will be exempted from the customs duties on its new purchases thanks to a recent law change that will positively affect its competitive power in the domestic market particularly against Pegasus Airlines, which has gained a substantial market share in recent years.

In March 14, the airline said it would buy up to 117 planes from Airbus, which are scheduled to be delivered between 2015 and 2020.

The company’s fleet size reached 202 planes last year, and this total will rise to 470 by 2021 with these new orders.

Last October THY ordered 15 jet airliners from Boeing, in a deal worth $4.7 billion, and 15 long-range jets from Airbus valued at $3.5 billion.

Turkey’s largest private airline, Pegasus Airlines, also ordered Airbus jets worth $12 billion in an agreement reached last December, ordering a total of 100 new jets.

THY workers to strike

Hava-İş union will announce the decision regarding a possible strike at Turkish Airlines (THY) tomorrow, as the company insists it will not rehire the 305 laid-off employees who participated in a strike a year ago.

Hava-İş said THY did not accept the offer to start talks in order to solve disagreements, including the rehiring of the 305 workers. “Our union will make a statement to the press about the reasons for the decision to strike at the Head Office of Hava-İş at 11:00 am on April 10,” it said.

However, Finance Minister Mehmet Şimşek reacted to the issue by saying they could not accept the suspension of flights. “THY is not alone. We will do whatever it needs. THY is a very important institution for national security and tourism. We cannot accept the flights being halted,” he said.

THY had announced in June that it would not rehire the 305 workers who were laid off after participating in labor action to protest a draft legislation banning strikes and lockouts in the aviation industry on May 29, 2012. Hava-İş members conducted a slowdown strike on May 29, resulting in the cancelation of 223 flights and the loss of about $2 million, according to THY chairman Hamdi Topçu. Despite the objections, the draft law came into effect on June 3.

THY’s sales volume reached 14.9 billion Turkish Liras last year, a 26 percent increase from a year earlier, and its real operating profit jumped to 1.05 million liras with a 192 percent increase, as its net profit increased from 19 million liras to 1.133 billion liras, up by 265 million liras in the last quarter of the last year.