(Bloomberg) — Turkey’s airlines are seeking government help for 20 billion liras ($2.5 billion) of bank loans to help them withstand the slump in travel.
Airline executives met Transport Minister Adil Karaismailoglu in Ankara on Wednesday, according to two people with knowledge of the matter, asking not to be identified because the meeting was private.
The minister is sympathetic to the request and will discuss it with other members of the government including Treasury and Finance Minister Lutfi Elvan, one of the people said. Details such as loan duration, costs and grace periods will be discussed at a later stage, the other person said.
The ministry declined to comment when contacted by Bloomberg by phone on Thursday.
Domestic and international travel restrictions and passengers’ reluctance to fly have burdened the industry, with flagship carrier Turkish Airlines, airport operator TAV and budget carrier Pegasus all reporting losses for the first nine months of the year. Turkish Airlines has reduced staff pay and sent foreign pilots on unpaid leave to slash costs, but analysts expect it to post a record loss of 7.31 billion liras this year, according to a Bloomberg survey.
Airlines need financing of about $2 billion until the end of next year to overcome the impact of the pandemic, Pegasus CEO Mehmet Nane said in an interview with BloombergHT in September.
Borsa Istanbul’s transportation industry index, in which two airlines have a combined weight of almost 85%, has dropped 13% this year. That compares with a gain of 16% for the benchmark index.
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