The FINANCIALÂ — Pegasus, the low cost Turkish airline company, has already served more than 5,000 passengers in the month since its launch in Georgia on October 10, 2010. The ticket prices at Pegasus are two-three times lower compared to other airline companies operating in Georgia which means that its planes are always full.
A one-way ticket from Tbilisi to Istanbul varies from 70-100 EUR, for Europe this is between 110-180 EUR, including taxes and charges.
The company has flights leaving Tbilisi every day, including weekends, at 06:30 a.m. and the flight from Istanbul, Turkey is at 23:45 Turkish time.
The latest offer of Pegasus Georgia was to provide a 3 day shopping trip in Istanbul. “We have designed a special tour for avid shoppers. The package which costs only 300 EUR, includes a round trip ticket, 3 days at the 5 star Via Hotel (www.viahotel.com.tr) with breakfast, transport from the hotel to airport, and insurance,” said Levan Elizbarashvili, CEO of Gasa, General Trade Representative of Pegasus in Georgia.
“There were several factors starting from global, governmental as well as passengers’ stream governing the lead up to Pegasus’ launch in Georgia,” said Levan Elizbarashvili.
Pegasus Airlines was established in 1990 as a joint venture between Aer Lingus, Silkar Yatırım and Net Holding in Istanbul. Pegasus operated its first flight in May 1990 and started its journey with just two aircrafts. Currently Pegasus has scheduled and charter flights to more than 100 different destinations in 17 countries.
“Pegasus has daily flights from Tbilisi to Istanbul’s Sabiha Gökçen Airport, which is the second airport in the city. The flights are performed only from this airport to 24 different cities. Pegasus is constantly adding new destinations. The company in Turkey plans to purchase 25 airlines in the next 5 years to expand its destinations,” Elizbarashvili declared.
“Shopping in Turkey’s large malls is a great pleasure, especially when the shopping centre is situated right next to the hotel,” Levan Elizbarashvili added.
“The rise in the economy is causing an increase of tourists in the country and is directly affecting the frequency of tourists, businessmen, and customer flow. That is why Pegasus added Tbilisi as its destination in October,” Levan Elizbarashvili said.
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“The capital should be considered not just a centre of Georgia but also a centre of the Caucasus, as here there is an accent on the population and passengers of Armenia as well as Azerbaijan, who are considered potential clients of air tickets and air transportation.”
“Pegasus Airlines has been trying to change its profile since 2005 and expand the list of the cities where it charters flights to. Within the framework of this strategy Pegasus entered Tbilisi. This was mainly governed by the reality and challenges which have existed in Georgia since 2004.
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The major determining factor when a low cost airline enters a country is a stable flow of passengers who use air transactions and air flights there. The flow of passengers in Georgia has significantly increased since 2004, the dynamics are stable and this is quite important for a company which operates in the Georgian market.”
Moreover, the entrance of low-cost airlines has caused a quick increase of current passenger numbers. What was previously largely inaccessible for many, has now become available. Consequently the conditions and environment in Georgia, from the point of view of doing business, governed the fact that Pegasus started flying from Tbilisi to Istanbul and then from Istanbul on to Europe.
Q. Pegasus is referred to as a low-cost airline. How has Pegasus changed the existing situation in the Georgian market?
A. The launch of Pegasus flights in Georgia coincided with the so called Winter Season in aviation, when the passengers’ rate decreases worldwide and is not as active as in the summer and New Year periods. These factors as well as Pegasus’ entrance in the market caused serious fluctuations. There are airline companies which are discussing the possibility of lowering the prices of their air tickets. However there are also some companies which have already decreased prices. This is a normal fact as in other cases companies would not be able to sustain their positions in the market after a new player enters the game with its own rules and significantly lower prices than them.
There is an ongoing tendency of decreasing prices of air tickets and therefore increasing passenger numbers. The fact that our airplanes are fully booked does not mean that others flights are empty. On the contrary, they are flying at full capacity too. This is due to the fact that low prices increased demand and we are seeing more passengers overall than before.
Q. What news will Pegasus deliver to its passengers in 2010/2011?
A. Our clients should constantly expect updates concerning prices. For the New Year period there is already a discount for tickets. Pegasus Airlines decreased the prices of tickets to its main destinations by 10 EUR at the end of October.
Moreover, we are constantly upgrading the quality of service, which includes the purchasing process of air tickets. Pegasus has opened a service centre at the Courtyard Marriott, where clients will have the opportunity to use the full service package starting from the booking of tickets to their payment.
Q. How much will an individual save if he travels with Pegasus?
A. For a one-way ticket an individual saves approximately 100-150 EUR and to Turkey 70-100 EUR. This is the lowest tariff of Pegasus’ compared to the lowest tariffs of other airline companies. After our lowest tariff, our tariff increases by 10 EUR and at other airline companies the tariff increases by a different amount. Round-trip tickets are 2-3 times less at Pegasus compared to at other companies.
Q. What was the total investment of Pegasus in Georgia?
A. The investments coming out of service specification were not significant. The majority of investment was in the advertising field. Moreover the company recruited 25 employees and plans to increase the number to 35.
Q. Does the company plan to add new destinations in the nearest future?
A. Pegasus has been expanding the chain of its destinations every year since 2005. The year 2010 was quite active during which the company added three new directions including Tbilisi. The company plans to cover the whole of Europe in the nearest future. Moreover, there is a strategy to expand to Asia as well.
Q. What services does Pegasus offer its clients onboard? Are they associated with additional expenses?
A. Pegasus provides the opportunity to passengers to purchase and choose the menu they would like. The maximum price of a meal is 10 EUR and what distinguishes us from other companies is that we give the opportunity to clients to define their meal.
Moreover, as opposed to other low cost airline companies, the ticket price actually includes a 20 kilo luggage allowance and 8 kilo hand luggage allowance. This is great privilege for the client as for additional luggage there is a requirement to pay 15-20 EUR or 3 EUR per kilo.
Q. Where are the majority of bookings at Pegasus made – from online reservations, travel agencies or directly from your service centre?
A. Pegasus offers several ways of purchasing tickets. The first is by telephone, when an individual phones to make a reservation and gets a special code, then visits TBC Bank or TBC Pay terminal to complete the transaction. The second is sale from our service centre in the Courtyard Marriott or directly from the airport’s office. The third way is online.
Pegasus cooperates with approximately 100 partner travel agencies throughout Georgia. Anyone can purchase tickets in different cities including Batumi, Kutaisi, Gori and Telavi. We have set neither restrictions nor deposits, and guaranteed advances to travel agencies. Thus we provide them with the opportunity to trade freely.
Q. Pegasus is periodically checked by German Company TUV Rheinland, which provides safety testing and certification (ISO 9001:2000). Which type of airplanes does Pegasus perform flights with and how do they differ from international airline’s planes, whose flights are more expensive?
A. First of all the price of its tickets makes Pegasus different from other airline companies. However by its quality, age, usage and condition it is even better than Georgian airlines present on the market. We are not at all different to the popular airline companies that are most associated with safety and quality. Moreover, some of our airplanes might be even better. In terms of this we take in to account the age, preservation, quality and look of the airplane.
In Georgia, Pegasus passengers are served by a Boeing 737-800 type liner, which is new, only 3 years old. The airplane is absolutely safe as at Pegasus passenger safety is vital. The plane has 189 seats.
Q. Low cost airlines are quite popular in Europe, including Pegasus in Turkey with 20 years of history. However, in Georgia the only low-cost airline company to have ever entered the Georgian market was “Germania” which soon withdrew. What is the difference between Pegasus and other global airline companies?
A. The major difference between other global airline companies is definitely the history of Pegasus. The company performed chartered flights 20 years ago, after which it was rebranded and mainly focused on inter country flights. Later the company went through a rebranding process and started international flights. The company has huge experience which it uses for its further development.
Q. How full does an airline company have to be not to have to withdraw from a market?
A. An airline company should have minimum 60% loading per flight, which is the super minimum.
Q. In your opinion, what makes airline ticket prices so high in Georgia?
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A. Firstly the airport charges make ticket prices higher. Our airport is in good condition, and passengers even have the chance to arrive in capitals’ second airports. Secondly, it is the distance that makes the prices higher. Istanbul is in Europe so the distance to Europe from there is less than directly from Tbilisi.
Q. In your opinion how developed is the tourism business in Georgia?
A. The tourism business is quite well developed in Georgia. There is high competition in the sector and almost everyone is involved in this business. As for the local market, it is more or less developed. It unprecedentedly developed within 4-5 years. The number of tourists increased significantly as well as sightseeing. In the tourism market, the most important thing for a tourist is what he eats and what he sees. When we speak of developing infrastructure, nutrition units should be developed, Georgian cuisine is quite delicious and memorable. However I believe there are perspectives that need to be developed further in this regard.
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