“Come in, come in,” beams Temel Kotil, the CEO of Turkish Airlines (THY), ushering MONOCLE into his expansive office atop the THY building at Istanbul International Atatürk Airport. “You will have Turkish coffee,” he announces, the table soon groaning with drinks and pastries. This lavish hospitality, according to Kotil, 49, is a main reason why THY, in its 75th year, is seeing record growth.

As Europe witnesses more consolidation, with Air France-KLM still circling ­Alitalia, and Lufthansa about to announce new routes and service innovations, THY has to keep a close eye on Gulf carriers (Emirates and Qatar Airways in particular), which pose a serious challenge to its long-haul ambitions. Having been CEO since 2005, Kotil is confident that Turkey can take on the giants.

Monocle: What do you put the success of Turkish Airlines down to?
Temel Kotil: It’s about making the customer feel good. We make sure that all aspects of service, from sales offices and call centres to check-in and on-board teams, reflect the highest standards.

M: You’re confident that Istanbul can become a major hub for the region?
TK: Oh yes. Historically it’s been a crossroads since the 11th century. It’s the perfect transfer point between Europe, Central Asia, the Middle East, and north Africa. You can reach 55 capitals within three and a half hours. Turkish aviation has grown faster than India or China’s over the past few years, with an explosion of low-cost airlines. We’d like to be the hub for southern Europe; a bigger airport is currently in the planning stages. We need it to compete with major Gulf hubs.

M: How far can Turkish Airlines expand?
TK: We’re launching 11 new routes this year, including flights to Toronto and São Paulo. We are also building on our American presence with flights to Washington, and establishing ourselves in Syria, Kazakhstan, Ukraine and Algeria. We’ll serve 150 destinations – 32 of those domestic. We’ve ordered 21 aircraft, to add to the fleet of 100, and we’re looking at 20 per cent growth over the next two years, so we carry 23.5 million customers annually.

M: Which areas need work on the fleet side?
TK: We have almost 100 narrow-bodied aircraft; we’d like to increase our long-haul fleet from around 12 to 16 and then further still, but the bulk has been short-haul flights. We’ve been biased toward short-and-thin rather than long-and-thick. We also want to increase business-class capacity and convert all Airbus 330 and 340 business seats into flat-beds.

M: Is national identity important as part of your brand identity?
TK: Very. We stress a very Turkish kind of hospitality. We have our own catering company serving traditional dishes. Our lounge at Atatürk is modelled on a traditional upscale Turkish home. People have said they feel like pashas in this place.

M: You have just joined Star Alliance. How will that change your business?
TK: It’s significant in that we’re becoming part of the worldwide airline community. It means we’ll have a presence in destinations we don’t yet reach. If Turkey joins the Eu, we’ll be strong enough to take on the competition.

Airline loyalty programmes like to divide passengers into segments, ranging from invite-only VIP programmes to gold to silver to worthless pieces of plastic in blue.

As airline alliances continue to expand, it might be time to segment airlines, as they are not all equal. Is United’s long haul service on a par with Singapore’s? Is Air France really the same as Aeroflot? Monocle reckons the hour has come for a tier system in the key alliances that divides stellar performers from carriers that simply add destinations to a network. The more substandard carriers invited into quality alliances, the more their validity is diminished.

1. American Airlines 99.8m
2. Southwest Airlines 96.3m
3. Delta Airlines 73.6m
4. United Airlines 69.3m
5. Northwest Airlines 55.9m
6. Lufthansa 51m
7. Air France 49.4m
8. All Nippon Airways 49.2m
9. Japan Airlines International 48.9m
10. China Southern Airlines 48.5m
    —
11. Emirates 16.7m
12. Turkish Airlines 16.4m

Source: IATA 2006