Is Tajikistan The World's Fastest-Growing Aviation Market?!

Hello dear reader,

Sincere apologies for the “radio silence” in the past weeks. While we all deeply love aviation and travel, some things are more important in life.

Such as health and focusing on a long-lasting recovery from an ankle fracture and surgery.

But as most airlines are recovering from the past years of crises, I am also recovering my walking ability.

Back to the hot aviation & travel tech stories because there are many spicy ones.

Also, I am going fully offline today, so the next briefing will come in the first week of July.

This week, you can read about:
🇹🇯 Tajikistan, the world’s fastest-growing air transport market
💻 Mystifly’s new PaaS platform
🔋 The first passenger flights on electric planes

This briefing is a 10-min read.

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THIS WEEK’S TOP STORY
The World’s Fastest-Growing Aviation Market….Drumroll Please…Tajikistan!

I recently came across an insightful report from Brendan Sobie, an international aviation analyst. In his LinkedIn post, he claims that Tajikistan is the world’s fastest-growing air transport market.

It got me shocked so I started looking into it. Is that true? How can Tajikistan’s aviation market grow that massively? While Sobie shared the obvious answer, I looked into it more. So let me give you an overview of how Tajikistan’s aviation market has grown so fast in recent years.

Tajikistan has been ruled by Emomali Rahmon for over 30 years, almost as long as the country’s independence after the fall of the Soviet Union.

The country has the smallest economy within the Central Asian countries and its aviation market also represents this unfortunate position. However, considering its air transport market, this seems to be changing.

At this moment, Tajikistan has four airports with scheduled passenger flights:

• Dushanbe Airport (DYU) - serving the country’s capital city, Dushanbe,

• Khujand Airport (LBD)

• Kulob Airport (TJU), and

• Bokhtar Airport (KQT)

Overall, these four airports are currently expected to generate an annual traffic of 4 million passengers by the end of 2024, compared to 2 million passengers in 2019, the last pre-pandemic year. Simple math applies here: 200% growth over five years, which includes the COVID-19 pandemic.

So what’s the reason behind such a growth level?

The answer seems to be as simple as the math above: Tajikistan benefits greatly from the Russian invasion of Ukraine.

As Russia has been under severe sanctions, Russian inbound traffic has grown greatly since 2022. According to OAG analysis, 84% of international seat capacity is accounted for by Russian traffic in this summer schedule.

Surprisingly, Russia’s flag carrier, Aeroflot, is not serving any of the Tajik airports, therefore, the dominant Russian player in Tajikistan is Ural Airlines, with an impressive 54% share of that aforementioned international seat capacity.

The Yekaterinburg-based airline serves 3 of the 4 airports in Tajikistan, except Bokhtar Airport, located in the southwestern part of the country.

Russian carriers not only dominate the majority of international seat capacity of the Tajik air passenger market but also have hegemony at Bokhtar and Kulob Airport.

Both these airports reside in Southwest Tajikistan and compete with each other due to the proximity of 85 km from each other. This “race” is now seemingly led by Kulob Airport due to its larger facilities and better infrastructure, including a longer runway. However, as regional media outlets report, Bokhtar Airport also went through some minor improvements in the past 2 years.

Dushanbe Airport, as the country’s main gateway to international destinations, has the most diverse lineup of serving airlines. Besides Russian carriers like Nordwind, S7, Ural Airlines, and Utair, it also has international flights to countries such as China, Kazakhstan, Kuwait, UAE, and Turkey, among others.

Khujand Airport has an average of 9 daily flights, out of which 8 serve Russian destinations. And, as mentioned above, the remaining two airports have no other services than Russian ones.

So what potential does Tajikistan have to diversify its passenger aviation market more?

Short answer: it has some. But the Tajik government has to do a lot.

The country’s flag carrier, Somon Air, flies to several international destinations, including flights to Germany, Kazakhstan, India, Iran, Pakistan, and more. It has a limited potential for further growth with its six Boeing 737 NG aircraft (+1 more on order).

Also, Tajikistan’s political environment and current economic policy don’t support the market growth and diversification from the Russian inbound hegemony. As Sobie reports, high airport costs and a lack of liberal policies block this opportunity.

This is also confirmed by a study done by the World Bank Group in 2023. This study assessed the opportunities for modernizing the aviation policy in Tajikistan with the long-term aim of transitioning the country to Open Skies in 2026.

What are some of the key challenges?

1. Infrastructural issues: Tajik airports suffer from inadequate airport quality, the need for substantial investments, and thus, a lack of major improvements, and strategic planning for such improvements.

2. A lack of cost-efficiency, costly air transportation services: extremely high turnaround infrastructure costs and monopoly of jet fuels that force passengers to use neighboring countries to take international flights.

3. Restricted market access: as mentioned above, the market is not diverse enough in terms of airlines currently serving the airports in Tajikistan. The government doesn’t take the necessary actions to foster the appearance of more international carriers in the Tajik market.

While there is light at the end of the tunnel, it is still quite weak. Whether the Tajik government ruled by its long-time president will take the recommendations by the World Bank to significantly improve its aviation market or not, is unclear yet.

However, seeing the positive effects of aviation liberalization in countries like Uzbekistan could encourage the less-developed economy of Tajikistan to take serious actions and leverage the great potential it could have. If the Central Asian country finally decides to step into the 21st century.

NEWS BRIEFS
TravelPerk Acquires Its US-based Competitor AmTrav

The Barcelona-based travel management & SaaS company announced its latest acquisition, as it takes over the Chicago-based AmTrav. This major deal brings together one of the two largest firms in the corporate travel world.

The financial terms have not been disclosed, however, TravelPerk revealed that Blackstone Credit & Insurance and Blue Owl Credit provide them with a $135 million credit facility. This comes after a $104 million Series D1 investment raised in January and led by Softbank Vision Fund 2 that increases TravelPerk’s valuation to $1.4 billion.

This acquisition helps TravelPerk to increase its US revenue and expand its footprint in such a significant market. However, AmTrav will remain as a brand and both co-founders, Jeff Klee and Craig Fichtelberg will keep their positions as CEO and COO, while their entire team will continue in their roles.

We have already seen several significant acquisitions in the corporate travel market in the past months, as reported, including the takeover of Direct Travel and CWT back in April.

Source: TravelPerk

Mystifly Launches New Platform-as-a-Service named Smart Selling Platform

Mystifly, the Singapore-based travel tech company unveiled Smart Selling Platform (SSP) aiming to simplify and revenue-optimize air content sourcing, selling, and servicing.

According to the statement from CEO Rajeev Kumar, SSP is the first cloud-based solution in the industry built for selling and servicing air content at scale.

This platform-as-a-service aggregates air content through NDC, direct connect, and GDS and also utilizes AI and natural language processing (NLP) to enhance source data and improve post-booking automation. This reduces agent call time, increases conversion, and lowers operational costs.

Mystifly already has its first customer for SSP, as the US-based Costco Travel deploys the platform to access Hawaiian Airlines’ exclusive NDC content.

Source: Mystifly

First Electric Passenger Flights Take Off This Summer For Trial in Europe

The first passenger flights on electric planes are coming to Europe this summer, as Skift reports. During a two-month trial period, the project Electrifly will connect Aachen, Liège, and Maastricht airports with a two-seater Pipistrel Velis Electro, the only EASA-certified electric aircraft today.

Flights start from €120 ($129) one-way and will be in service between July 1 and August 31. The project will also provide “door-to-door electric transportation” as NIO electric cars will pick passengers up within a 15 km radius of the airport.

The only catch of booking for this trial is the body weight limitations, as, for safety reasons, the pilot and the passenger together cannot exceed the 178 kg limit.

Source: Skift

FAVORITE PIECES THIS WEEK
My weekly “Inflight Food for Thought”

🚨 One Article: There is a shocking story on how an Etihad executive is accused of creating a fake LinkedIn profile under the name of “Ivander Sebastian”, working at Ethiopian Airlines. The spicy part of the story is that this fake profile was applauding Etihad’s success story. Even ex-IndiGo CCO Willy Boulter called out this person. It’s worth a read!

⚠️ One Video: A fascinating documentary on Air Canada Flight 759’s almost tragic near miss at San Francisco Airport in 2017.

SOCIAL MEDIA CONTENT OF THE WEEK
TravelPerk Trolls Its Competitor By Celebrating Its New Acquisition With Free Ice Cream At Navan’s HQ

The ice cream truck says: “Smoooooooth” (or it might be even more Os).

Anyway, it looks like a fun brag and showing a middle finger at TravelPerk’s US competitor.

Do I approve that?

Well, I salute free ice cream. Next time, please let me know and give me a free flight ticket so I can also grab two scoops of pistachio.

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See you next week!