Q&A: Hossein Hosseini, Director of Marketing, Mahan Air

14 September 2010

The Iranian airline has increased its fleet size and wants to capture more share of the domestic and international markets

MEED: What are your plans for expanding Mahan Air’s route network?

Hossein Hosseini: The economy in Europe has not recovered fully from the global economic downturn yet and there is a lot of overcapacity in the market and fares are under downward pressure.

We are monitoring the European traffic flow and developments for finding suitable new destinations, but since the Middle East and the Far East are enjoying a much more vibrant situation in airline terms, we are orienting Mahan Air in that direction in the short term.

Our first aim is to connect Iran with the global community and our success will depend on being a niche player

We are being approached by a lot of European airports who want to attract us to commence operations between Tehran and their airports, but we are being very selective since the bilateral agreements are limiting our options.

Are you having any problems obtaining fuel in Europe?

We are experiencing some problems refuelling in Birmingham only, but we are trying to solve the issue, which is due to the only two fuel suppliers in that airport being American companies.

We feel there is absolutely no justification for their action since they have to supply civilian airliners in that airport. This is not an EU issue since it is an isolated case and, with the assurance of all European airports that we are currently operating to now or intending to operate to in the near future, we are going ahead with our plan of careful and selective expansion in Western Europe.

Do you have any aircraft on order?

We have increased our fleet size substantially over the last three years and our fleet renewal and expansion plans are based on clearly defined parameters over the next five years.

From what I can tell you, the plan calls for further growth in our fleet size in order to capture more market share in domestic and international markets.

What is the ultimate vision for Mahan Air?

We are enjoying a large home market of more than 70 million people and if we expand our catchment area to about three flight hours in each direction it will cover a population of 350 million.

Our first aim is to connect Iran with the global community and our success will depend on being a niche player in the global market place, given our limited ability to secure desired routes and the amazing growth of mega-carriers to our south such as Emirates. As for the long-term ambitions, since our Tehran hub offers the shortest distance between Europe and the Far East and with improved product reliability and brand recognition we intend to increase our transit traffic share, which is currently less than 15 per cent of our international traffic.

On the home front, we are aiming for a 35 per cent share of the 16 million domestic market by 2012.

And last but not least, we aim to remain profitable while achieving all our objectives. As optimism is ingrained deep into the Mahan Air culture, we are confident that we can indeed achieve the above strategic goals.

What are the main challenges of being a private carrier in Iran?

By far the biggest challenge that we face is the orientation of the Iranian government towards the governmental carriers that limits our access to our desired international target markets.

For example, we cannot entertain the idea of serving western European capitals, which are very important in our network planning.

We are given the non-lucrative routes and we have to make the best of what they will offer us in terms of new routes. We are hoping that we will see change in orientation and clear moves by the Iranian government towards liberalisation and deregulation in the aviation industry soon.

In fact, I think that continued existence and growth of Mahan Air in its current form has been no less than miraculous in such a harsh regulatory environment!


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