Istanbul Grand Airport – IGA – is seeking to demonstrate its leadership credentials on several fronts beyond its aspirations of becoming Europe’s largest hub. CEO Selahattin Bilgen explains the airport’s thinking to ARGS Editor Mark Pilling
The leadership of Istanbul Grand Airport, the most significant greenfield airport on the continent in recent decades, is convinced that its success story will be judged in many more ways than simply being a huge hub.
“Our image is that of a very large-scale airport, with high growth, but on the technology and sustainability side, for example, there are many things we can talk about,” said Bilgen.
Now is the time, five years since it began operating, for IGA to spread its wings and its influence on the global stage.
“We have been behaving as a start-up company,” explained Bilgen. Istanbul’s air traffic was transferred to IGA in April 2019 from the mega city’s existing hub, Atatürk Airport.
A year later Covid decimated air travel, but IGA – alongside Türkiye’s air travel market – has stormed back. “We have been successful thanks to our corporate culture, which allows us to be agile and also resilient to the crisis we have seen,” said Bilgen.
“But at the same time, we are now a very large-scale corporate company,” he noted. “Now we must make an organisation change which will allow us to focus on more sustainability, not only environmental and social aspects, but in general as a management style. We must have our standards when you are managing 12,000 people for a 25-year concession period.”
Accordingly, as the business matures, the airport company is undergoing a corporate organisational transformation that is designed to position IGA as a leading enterprise in Türkiye, plus give it the platform to expand internationally as the opportunity arises.
Additionally, IGA aspires to be recognised as a global airport player and partner, as demonstrated by its focus on collaborating widely with international bodies such as ACI and ICAO both to share its expertise and to enable its teams to learn in the process.
It falls to Bilgen (IGA’s former CFO who was made acting CEO in October 2023 following the departure of its first CEO Kadri Samsunlu) to lead the company in this more outward-looking strategy. Bilgen was appointed CEO in April 2024.
Holding company
The new CEO is overseeing the creation this autumn of IGA Holding Company, a corporate structure designed to propel the business forward, to organise its functions more efficiently and give it the ability to strike out of Türkiye.
“The IGA company was an SPV [Special Purpose Vehicle] founded to develop Istanbul Airport,” noted Bilgen. It has served that purpose and now is the time to move to the next stage. “That’s why we needed another vehicle to be at least structurally able to do more things,” said Bilgen.
“One of the potential issues the holding company will focus on will be projects abroad. We have developed a lot of experience which we can use in other places as well,” he stated.
“Not every project can have a growth pattern or scale like Istanbul airport but having a team which, for example, did the ORAT (Operational Readiness and Airport Transfer) in house, did the construction in house, had this huge experience and success together, we can now plan projects on various scales.
“We will have the right vehicle to go for other projects, both on the advisory side and also as investors,” said Bilgen.
But there is no rush. “We are starting slow. Maybe in the future we will have more aggressive targets, but now we are focused on making the right organisational structure which will allow us to do it,” he said.
Today the priority is ensuring Istanbul Airport achieves its targets. “We still have many things to do within our airport,” said Bilgen.
The formation of the holding company has various benefits. “There are several reasons, from the tax perspective, to having the correct cost centres enabling better reporting, to positioning ourselves as an education centre,” he explained.
IGA continues to build
As traffic grows IGA will continue its own expansion. Phase two of this has already started with a fourth main runway, plus an ancillary runway, under construction and scheduled for completion in 2026.
The airport currently operates with three independent runways plus two ancillary runways. From next year simultaneous independent parallel operations will be introduced. Such a luxury of runway capacity is rare anywhere and especially in Europe.
The airport’s masterplan involves progressively building more runways up to five independent parallel runways by 2040. This would be a world first.
Developing capacity is critical but there are also significant investments in other areas such as sustainability. “For example, we are trying to position ourselves as a carbon-neutral airport with our solar power plant even taking into account our Scope Three emissions [these encompass emissions that are not produced by the company itself],” said Bilgen.
Driving to be No 1
With 76 million passengers in 2023, IGA now ranks seventh in the world and second in Europe (behind London Heathrow). The ambition is to be number 1, a measure that IGA has achieved on some fronts.
“We are globally number one with respect to connectivity, with more than 315 destinations. With over 106 airlines, and ending the year with 110, this will make us number one with respect to airlines,” said Bilgen.
And there is plenty of room to grow. “Passenger-wise we are still under-penetrated in North America and Asia-Pacific,” he added.
This year, IGA is hoping to achieve its stretch target of 85 million passengers. “We believe it is achievable. The events in the Middle East decreased flights from Israel and Jordan as the region has been hit by the crisis. It is affecting our numbers, but we are still on track with respect to new airlines coming. We are trying to make up the difference with the newcomers.”
Low-cost carriers
There has been tension about the addition of low-cost carriers at IGA, which is dominated by fast-growing Turkish Airlines.
Acknowledging this issue, Bilgen outlined IGA’s approach. “We have been arguing that if we act on a selective basis with respect to LCCs it would benefit, rather than destroy [the market] and the data has proven this up until now.
“Of course, we are not allowing routes which compete with the existing destinations. But we have been making agreements for destinations which are not covered in the current scheme,” he explained.
For example, easyJet and Wizz Air have started a handful of routes not served by Turkish Airlines. IGA performed research to examine the traffic impact.
Turkish was concerned the new routes would harm its traffic to nearby cities. But: “It wasn’t the case. The growth of Turkish Airlines was not affected,” he added. In fact, the connectivity brought by the new routes has benefited Turkish Airlines.
“Actually, this has seen an improvement between Turkish and us,” said Bilgen. “We believe Turkish has now seen that connecting Istanbul with other destinations is a benefit because people coming to Istanbul are carried by Turkish to other destinations and it’s feeding their flights.
“We have identified that if we go with LCCs on a selective basis, it is not destructive. The idea is not to destroy or cannibalise but contribute [to traffic growth]. When we see this, we want them to come,” said Bilgen.
Opportunity in China
Just as it used data to promote LCC route development, IGA has done the same for Chinese route development. “The difficulty in business is often in making informed decisions,” said Bilgen.
In the past, the Turkish CAA viewed the Chinese market in a protectionist manner. “Now, both Turkish Airlines and the Civil Aviation Authority are very supportive of newcomers. We have made an agreement with four Chinese carriers and are in discussions with three more,” he said.
Turkish itself has been expanding into China and now operates to four Chinese destinations with 21 weekly frequencies, and in doing so is capturing traffic that would otherwise have transferred via the Middle East hubs.
“It is much more efficient and cost effective for Chinese travellers to transfer in Istanbul because on average [their journey] is one and a half hours shorter,” he said. Istanbul is also able to offer slots at peak times for Chinese carriers.
“We provide a very good fit for Chinese carriers. Instead of making transfers at Dubai or Qatar, if they start to fly to Istanbul more, there is an efficiency gain. And this will potentially increase Chinese traffic to Istanbul dramatically,” he said.
Furthermore, as Türkiye positions itself as a destination, the belief is that it can attract more Chinese tourists who would go there rather than other European points. “We have a very rich historical and cultural heritage,” said Bilgen.
In 2023, IGA Istanbul Airport hosted 255,000 Chinese passengers. The airport aims to increase the number of Chinese tourists to the pre-pandemic level of 426,000 in 2024 and to reach 1 million later this decade.
IGA is helping facilitate talks between the two countries to open more frequencies between them as Turkish and Chinese carriers reach the current 21 weekly service ceiling. “Both sides are very open to increase the frequencies,” he said.
One of the latest Chinese carriers to open services to IGA was China Southern Airlines. In June, it began a three-times-weekly service between Istanbul and its Guangzhou hub.
Information sharing
Having the opportunity to build a new-generation airport within the past five years has positioned IGA with experience and technology that few can match, believes Bilgen. And IGA is ready to share its knowledge, he noted, which is essential in a sector where all stakeholders are so integrated.
“We spent huge amounts of money on our technology infrastructure, but we are not currently using even half of it,” said Bilgen. “For example, we had to follow the green system infrastructure in the airport, but we are waiting for other stakeholders to be ready for it. We have the infrastructure for contactless journeys but there are legal issues and others that limit us in that respect.
“We have been acting really openly to share our experiences with the sector because we believe more co-operation and collaboration among stakeholders in the system will enhance all of our efficiency and ultimately help all of us to grow. We believe we must share experiences, share data and use more integrated systems,” he said.
IGA is well placed when it comes to data and using it to make the informed decisions that Bilgen advocates at an operational level
“While we were developing our own systems, we were lucky enough to structure the system in such a way as to collect data from each operation and turn it into information,” he explained.
A good example is the triple runway operation where IGA’s experts identified that aircraft spend over 50,000 excess minutes on the ground every week because airport and air traffic design are not matching perfectly. “This could be eliminated if all parties used this data together. We are working with Eurocontrol, Turkish Airlines and the state aviation authority to enhance information sharing and to improve airspace design.
“Although this is a message of enhancing co-operation and collaboration, the differentiating factor here is we have the data, and we have the analysis that proves the benefits,” said Bilgen.
IGA is keen to share its experience, but Bilgen is equally keen to ensure there is a results-driven outcome. “We have working groups [with a variety of partners], but we are rarely able to turn those groups into projects,” he noted, because they tend to be under-resourced and so remain academic studies.
“Our view is we have to be more practical; we have to be more operational. So collaborative projects should drive efficiency projects, which will enhance the sector’s economic parameters going forward,” said Bilgen.
He used an example from IGA’s experience with baggage handling. “Although we are a very large airport, we are mostly number one in terms of baggage delivery times,” he noted, in addition to being number one in terms of lost baggage percentages and often a leader according to Eurocontrol with respect to delays attributable to airports.
According to Bilgen, IGA can achieve this performance as a result of “many issues including our positioning as a technologically advanced and newly developed airport, but at the same time we have been showing a solid success in numbers as well.
“We are trying to be the spokesperson for the sector in general because we believe that overall sector growth is more important than competition amongst various parties,” concluded Bilgen.
