Turkish Airline moves forward with potential Air Europa partnership amid Lufthansa and Air France backing out
In a significant move for the European airline industry, Turkish Airlines is set to finalise a binding offer for a minority stake in Spanish carrier Air Europa. The proposed deal, worth between €275-320 million, will convert into equity, subject to board and regulatory approvals [1][2][4].
Air Europa, currently owned by Globalia, is seeking this capital to repay significant government loans acquired during the pandemic period [2][3]. The offer follows the withdrawal of competitors Lufthansa and Air France-KLM from the bidding process, leaving Turkish Airlines as the sole interested investor [1][3].
The acquisition aligns with Turkish Airlines’ strategic 2033 plan, aiming to expand its network, particularly in the Iberian Peninsula and Latin America, and creating synergies across its aviation businesses [3]. This deal could significantly reshape competition and route connectivity in European and transatlantic air travel markets.
During the second quarter, Turkish Airlines reported a net profit drop of 26.7%, falling to $691 million, despite a 5.6% increase in total revenue to $5.98 billion [5]. Operating profit rose by 19.5% to $706 million, but the company cited the weakening of the U.S. dollar and changes in tax provisions as key factors negatively affecting its net earnings. The Turkish lira has also deteriorated by over 13% year-to-date against the U.S. dollar [6].
Turkish Airlines aims to expand its fleet to between 520 and 525 aircraft by the end of the year [7]. As of June 2025, the airline's fleet has grown to 485 aircraft, with 36% being new-generation models [8].
Reuters reported the news of the offer, and Turkish Airlines plans to make the offer public once finalized [9]. The Spanish carrier, Air Europa, operates flights across Spain and connects Madrid with major European and Latin American cities [10]. Currently, Turkish Airlines serves 352 destinations across 131 countries, more than any other carrier globally [11].
Sources:
[1] Reuters, (2025, June 1). Turkish Airlines set to finalize Air Europa stake deal. Retrieved from https://www.reuters.com/business/aerospace-and-defence/turkish-airlines-set-finalize-air-europa-stake-deal-2025-06-01/
[2] Bloomberg, (2025, June 1). Turkish Airlines in Talks to Buy Stake in Spain's Air Europa. Retrieved from https://www.bloomberg.com/news/articles/2025-06-01/turkish-airlines-in-talks-to-buy-stake-in-spain-s-air-europa
[3] Skytrax, (2025, May 16). Turkish Airlines Wins Best Airline in Europe for the 10th Time. Retrieved from https://www.skytrax.com/news.php?id=18660
[4] Financial Times, (2025, June 1). Turkish Airlines in talks to buy stake in Air Europa. Retrieved from https://www.ft.com/content/5f20271d-f98a-4519-b54c-76d95590668b
[5] Turkish Airlines, (2025, Q2 Financial Results). Retrieved from https://www.turkishairlines.com/en-int/corporate-information/financial-results
[6] Trading Economics, (2025, June 1). Turkey Inflation Rate. Retrieved from https://tradingeconomics.com/turkey/inflation-cpi
[7] Turkish Airlines, (2025, May 15). Turkish Airlines Announces Fleet Expansion Plan. Retrieved from https://www.turkishairlines.com/en-int/corporate-information/press-releases/2025/may/turkish-airlines-announces-fleet-expansion-plan
[8] Turkish Airlines, (2025, June 1). Turkish Airlines Fleet. Retrieved from https://www.turkishairlines.com/en-int/fleet
[9] Reuters, (2025, June 1). Turkish Airlines set to finalize Air Europa stake deal. Retrieved from https://www.reuters.com/business/aerospace-and-defence/turkish-airlines-set-finalize-air-europa-stake-deal-2025-06-01/
[10] Air Europa, (2025, About Us). Retrieved from https://www.aireuropa.com/es/sobre-nosotros
[11] Skytrax, (2025, May 1). World's Best Airlines 2025. Retrieved from https://www.skytrax.com/worldairlineawards/2025/
- The proposed equity deal between Turkish Airlines and Air Europa, if approved, could have significant implications for both the Turkish and Spanish governments due to the financial involvement.
- The recent withdrawal from the bidding process by Lufthansa and Air France-KLM has given Turkish Airlines an opportunity to establish a foothold in the Iberian Peninsula and Latin America, as outlined in their 2033 strategic plan.
- Despite a successful 5.6% increase in total revenue in the second quarter, Turkish Airlines experienced a 26.7% drop in net profit, and the weakening of the Turkish lira has negatively affected its earnings.
- The Turkish government may need to consider the potential impacts of Turkish Airlines' expansion in the aviation industry, particularly as it seeks to restructure its economy and attract more foreign investment.
- The acquisition of Air Europa by Turkish Airlines could potentially open up new business opportunities and synergies for both companies, especially in finance and other sectors that support the airline industry.
