Impact of Covid

Submitted to:
19’ on
Sir Arslan Ali Soomro
Turkish Airlines

OCTOBER 4

Turkish Airlines
Authored by: Muhammad Attique Shah

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Introduction
Turkish Airlines was founded in 1933 as Turkey's first flight carrier under the Ministry of Defense. In

1956, it was reorganized and operated under special legislation and renamed Türk Hava Yolları A.O.

Since this time, it has continuously expanded its fleet. Under successful growth strategies, Turkish

Airlines had added new flight destinations and aircrafts to enhance its values. Turkish Airlines decided

to join the Star Alliance on 4 August. It had been nominated “The Best Airline” in its region and

received the Aircraft Finance Journal's “2008 European Deal of the Year” award for the financing of

aircraft. Turkish Airlines is known for its impeccable service, flight safety and connectivity worldwide.

With its global headquarters in Istanbul, it is a gateway between east and west. In recent years, Turkish

Airlines had achieved 12% growth in its operating profits and 15% growth in its sales revenues. The

number of aircraft grew by 4%, from 127 to 132. International routes accounted for 79% and domestic

routes 21% of revenues from scheduled services. Turkish Airlines had established the Anadolu Jet

brand and transported 13.4 million passengers to 119 destinations in 5 continents. Turkish Airlines had

kept growing even during the economic crisis. This case examines the vision and mission of Turkish

Airlines and its growth strategies. It also examines the marketing strategies used to pursue growth.

Turkish Airlines had established the Anadolu Jet

brand and transported 13.4 million passengers to 119
destinations in 5 continents.

POSITION OF TURKISH AIRLINES BEFORE THE

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PENDAMIC
As the deadly virus started in 2019, so let’s have a glance on; what was the position of Turkish Airlines

in 2019 and in 1st quarter of 2020. Since, retrospective investigations by Chinese authorities

acknowledged human cases incepted of signs by early December 2019. Meanwhile few of the earliest

cases had a link to a wholesale market in Wuhan.

The net operating profit in 2018 was 753 million USD dollars and it increased in a decreasing order to

just 788 million USD dollars. With this a negative impact on sales cost can be seen, on 30 th December

2018 the cost of sales was 10,136 and after a year, that is 30 th December 2019, it raised to 10,136 USD

dollars. In that period they anticipated that in the following quarter they were forestalling the

development in the both market in the nearby deals too in the fares of the concrete.

They further forecasted that the prices in the north region of country will remain competitive while in

the south region of the country due to surplus supply of the fuel by the companies, the prices may faces

downward pressure in that region. Furthermore, they also forecasted that their cost of sales will also

increase in the coming period due to increase in fuel prices and well as kerosene tariffs.
During the ‘COVID-19’ Pandemic

Referring to below given table eliciting annual revenue/expense of the aviation industry, it can be seen

that likewise Turkish Airline, the entire industry had faced the troughs after Covid 19’. Most

shockingly, the operating profit percent declined 5.8 in 2018 to 5.1 in 2019. There had been a 1 million

USD dollar decline in cargo revenue which was 102.3 million dollars in 2018 and declined to 101.2

million USD dollars in 2019. Due to that, a negative growth of -3.3% can also be seen in below given

table.

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After the ‘COVID-19’ Pandemic

The administration of fortunate concrete are expecting a similar lower deals in the following time

frame too because of the legislature is constantly extending the Lockdown time frame which causes the

conclusion of business and that at last will influence their deals contrarily.

The drastic decline may reduce the cost of inputs for company which may also help to increase the

gross margin.

Further, looking at the precautionary measures taken by the company, it can be forecasted that if thing

go normal the company is going to regain its previous position and stand out among few handpicked

global airlines.