Türkiye's Pegasus to Begin work on New Plane Order for Delivery beyond 2029

Officials work on the wreckage of a plane operated by Pegasus Airlines after it skidded Wednesday off the runway at Istanbul’s Sabiha Gokcen Airport, in Istanbul, Thursday, Feb. 6, 2020. (Emrah Gurel/Associated Press)
Officials work on the wreckage of a plane operated by Pegasus Airlines after it skidded Wednesday off the runway at Istanbul’s Sabiha Gokcen Airport, in Istanbul, Thursday, Feb. 6, 2020. (Emrah Gurel/Associated Press)
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Türkiye's Pegasus to Begin work on New Plane Order for Delivery beyond 2029

Officials work on the wreckage of a plane operated by Pegasus Airlines after it skidded Wednesday off the runway at Istanbul’s Sabiha Gokcen Airport, in Istanbul, Thursday, Feb. 6, 2020. (Emrah Gurel/Associated Press)
Officials work on the wreckage of a plane operated by Pegasus Airlines after it skidded Wednesday off the runway at Istanbul’s Sabiha Gokcen Airport, in Istanbul, Thursday, Feb. 6, 2020. (Emrah Gurel/Associated Press)

Türkiye Pegasus Airlines will in the coming months begin work on its next plane order as it looks to continue its fast-paced growth into the next decade, the budget carrier's CEO told Reuters on Sunday.

Pegasus, which has seen a rapid recovery in travel after the pandemic, placed an order for 36 Airbus A321neo planes in July 2023, taking its total orders since 2012 to 150.

Sixteen will be delivered this year and the remaining 52 by the end of 2029, Guliz Ozturk said in an interview.

Production slots at the two dominant planemakers Airbus and Boeing are sold out for many years, resulting in long wait times for airlines wishing to replace and grow their fleets.

"Beyond 2029, as long we want to grow - and we want to grow, the demand is there - we have to go out with a new order," Ozturk said, adding that there are no specific decisions or studies yet.

Safety concerns at US planemaker Boeing and output delays at Airbus are forcing airlines to plan new aircraft orders well in advance to keep pace with the rapid rebound in air travel since the pandemic.

Pegasus has a mixed Boeing and Airbus fleet of 105 aircraft, but the fleet is dominated by European planemaker Airbus.

When asked whether the airline's dual fleet strategy has worked well, Ozturk said that while it may seem simpler to run a single fleet, "when you have delivery delays, it's good that you have the two manufacturers in the picture".

Pegasus has not faced any significant delays in deliveries from Airbus, she added.

For Ozturk, the biggest challenge is keeping pace with demand while managing costs at a time when geopolitical tensions and wars result in higher fuel prices and add to inflation.

She said despite the disruptions, the airline aims to achieve an operating profit margin of 28% to 30% in 2024.



Trump Trade War to Sap Canadian, Mexican and US Growth, OECD Says 

Lumber is piled at a housing construction site, Thursday, June 24, 2021, in Middleton, Mass. (AP)
Lumber is piled at a housing construction site, Thursday, June 24, 2021, in Middleton, Mass. (AP)
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Trump Trade War to Sap Canadian, Mexican and US Growth, OECD Says 

Lumber is piled at a housing construction site, Thursday, June 24, 2021, in Middleton, Mass. (AP)
Lumber is piled at a housing construction site, Thursday, June 24, 2021, in Middleton, Mass. (AP)

President Donald Trump's tariff hikes will drag down growth in Canada, Mexico and the United States while driving up inflation, the OECD forecast on Monday, cutting its global economic outlook and warning that a broader trade war would sap growth further.

In the case of a generalized trade shock, not only will US households pay a high direct price, but the likely economic slowdown will cost the United States more than the extra income the tariffs are supposed to generate, the Organization for Economic Cooperation and Development estimated in its interim outlook.

Global growth is on course to slow slightly from 3.2% in 2024 to 3.1% in 2025 and 3.0% in 2026, the Paris-based policy forum said, cutting its projections from 3.3% for both this year and next in its previous economic outlook, issued in December.

But the global picture masked divergences among major economies with resilience in some big emerging markets like China helping to make up for a marked slowdown in North America.

The proliferation of tariff hikes would weigh on global business investment and boost inflation, leaving central banks little choice but to keep interest rates higher for longer than previously expected, the OECD said.

The organization updated its forecasts assuming tariffs between the United States and its neighbors are raised an extra 25 percentage points on almost all goods imports from April.

As a result, US economic growth was seen slowing this year to 2.2% before losing more steam next year to only 1.6%, the OECD said, cutting its forecasts from 2.4% and 2.1% previously.

But the Mexican economy would be hit hardest by the tariff hikes, contracting 1.3% this year and a further 0.6% next year instead of growing 1.2% and 1.6% as previously expected.

Canada's growth rate would slow to 0.7% this year and next, well below the 2% previously forecast for both years.

TRADE WAR FALLOUT

With less direct exposure to the trade war for now, the euro area economy was seen gaining momentum this year with 1.0% growth and reaching 1.2% next year, although that was down from previous forecasts for 1.3% and 1.5% respectively.

Stronger government support for Chinese growth would help offset the impact of higher tariffs in the world's second-biggest economy, the OECD said, forecasting 4.8% growth in 2025 - up from 4.7% - before slowing to 4.4% in 2026 - unchanged from the previous estimate.

However, the OECD said the global outlook would be much worse if Washington escalates the trade war by raising tariffs on all non-commodity imports and its trade partners do the same.

It estimated an increase in bilateral tariffs permanently by 10 percentage points would shave around 0.3 percentage points off global growth by the second and third years of the shock, while global inflation would be on average 0.4 percentage points higher over the first three years.

In such a scenario, the US economy would suffer a significant hit, with growth 0.7 percentage points lower than what it otherwise would have been by the third year. The direct cost to US households could be as much as $1,600 each.

The financial cost from the economic drag from tariffs would also offset any extra income they generate for the public coffers, which means they would be insufficient to pay for lowering other taxes as the US administration has planned.