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ITE Transport and Logistics

Iran’s aviation industry aims for the sky

As sanctions are repealed, Iran’s transport networks are expected to enjoy supersonic growth – including the aviation industry. Iran is seeking to re-enter global airspaces, in terms of both trade and passenger travel, with a number of exciting developments set to take off soon.

Spreading Iran’s wings

Iranian investment in transportation, specifically aviation, is certainly sky high. Some $28 billion in contracts were awarded in late 2015, pre-sanction lifting, at the first Iran Transportation and Urban Development Summit for example.

The Iran Airports and Aviation Development Forum has also acquiesced to big spending and big projects. In a statement released in September, 2015, the group said it was looking to build 27 new airport terminals at a projected cost of $8 billion.

Expanding airport capacity and replacing an aging commercial fleet is a top priority. In January, 2016, it was announced that state-owned carrier Iran Air will be seeing an influx of new aircraft as Iran inked a $25 billion deal with Airbus. The French firm will be supplying 118 new jets, including its flagship A380 model, to Iran in a deal that will shake up the nation’s commercial and trade operations.

Iran’s Deputy Transport Minister, Asghar Fakhrieh Kashan, stated the country is interested in purchasing 100 aircraft from Boeing too meaning its total air freight capacity could significantly grow in the future.

Iran is certainly keen to begin stepping up its air freight operations as soon as possible. One trade route Iran is keen on expanding is to Lebanon. A delegation led by Chairman of the Iran Chamber of Commerce, Industries, Mines and Agriculture (ICCIMA), Mohsen Jalaplour, visited Lebanon in December 2015, resulting in the Iranian diplomat stressing the importance of expanding air freight to the region.

Iran Air Cargo, Iran Air’s freight subsidiary, currently flies to 20 scheduled and 5 chartered destinations. It is likely Iran will continue to seek further air freight opportunities once its ambitious airport and plane purchasing projects are completed.

Seven international airports planned

At the Iran Transportation and Urban Development Summit, in October, 2015, it was announced that Iran will build seven new international airports over the next decade. The plan was announced by Abbas Akhoundi, the Minister of Roads and Urban Development.

Expansion is much needed. Iran’s main international hub, the Imam Khomeinin International Airport, was originally conceived to handle 50 million passengers per year. At present capacity, it can only handle 6 million so a second terminal is planned to take an additional 5 million passengers.

The locations for the 7 airports have yet to be released, but it was announced that French construction giants Vinci has signed a memorandum of understanding (MoU) with the Iranian government to build two new airports. These will be constructed in Mashhad and Isfahan, Iran’s second and third cities.

The current airports in these two cities does handle a large number of passengers, both in the millions, but capacity and trade demands are behind the planned new airports. Mashhad is a holy city, so attracts millions of domestic visitors a year – some 8.2 million passengers passed through in 2014 for example. However, its close location to Turkmenistan, Afghanistan and Pakistan makes it an ideal trade hub so Iran will no doubt look at expanding air freight operations from the city.

Aviation set to take off in Iran

Transport Intelligence released its rankings for emerging markets in January 2016, rating countries on their attractiveness for foreign investment in the transport sector. Iran has jumped up 12 spots from rank 27 to 15 with the lifting of international sanctions.

Aviation expansion is likely to push this rating even further in the coming years. However, with massive government investment and backing, it appears as if the skies are clear for take-off for the Iranian aviation industry.

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