Air Astana CEO reveals plans to boost market value

Euronews

20-06-2025

As Central Asia's only airline listed on three stock exchanges, Kazakhstan's flagship carrier Air Astana has led the region's aviation sector for over 20 years.
Since its IPO in February 2024, the airline's share price has dipped. Ahead of their half year results, Euronews sat down with Air Astana's CEO, Peter Foster, to discuss his plans to raise share prices and expand Kazakhstan's flag carrier's global presence.
Q: How do you assess investor sentiment following Air Astana's IPO, and what key strategies do you plan to implement to maintain stock and shareholder value?
A: The stock price has been a bit disappointing since the IPO in February of last year — the stock price has declined. The main point to make is that the company, in fact, has performed extremely well and continues to do so.
So of course, our job is to manage the company to the best of our ability and of course to maximise shareholder value. We have recently announced a very substantial dividend. In fact, the largest dividend that we've ever paid, and one of the largest dividends in the airline industry today. And that's a reflection of the strong performance, of the strong balance sheet, the strong cash balance. We believe that if we continue to manage the company well and if it performs well, the stock price will follow eventually. The key really is to continue managing the airline in the way that we have in all [my] 20 years here: To keep focussed on cost, to keep cost competitive so that the airline remains competitive in an increasingly challenging global marketplace and to maximise service levels to ensure top class safety standards and by doing so, we can leverage the quality of the product to ensure the airline continues being profitable.
Q: You have outlined major strategic opportunities for international growth — in the Gulf, Western Europe, China, Korea, Japan and India. What would these partnerships entail?
A: Kazakhstan is a country of 20 million people and yet Air Astana today is at 62 aircraft and of course we intend to grow that to 84 aircraft by the end of 2028. When you look at the size of Air Astana and growth profile and the overall size of the Kazakhstan market, you see that of course we are proud to serve the Kazakhstan market and Kazakhstan's travellers, but it's not sufficient to enable the airline to grow as we are doing into a significant international airline player. Therefore, we absolutely need to leverage our position in close proximity to some of the world's largest markets to ensure that we are also getting a significant portion of our customers from those large markets which are much bigger than Kazakhstan.
The best way to leverage that geographical position is to work with partner airlines from those countries. We're presently in discussions with China Southern in China, we are having discussions with carriers in India, we've recently signed a code share with Japan Airlines for the Japanese market, we have an existing commercial relationship with Lufthansa for western Europe, with Turkish Airlines for Turkey. So, this is the way that an airline of our aspiration with a home market that is relatively small can leverage the quality of the airline and the geography of location of the airline with partners to expand beyond its own borders.
Q: With the current shortage of fuel-efficient aircraft, how is Air Astana adapting its operational strategies?
A: The manufacturers and the engine manufacturers introduced new engine technology from NASA ten years ago. Without going into technical detail, it was technology that was primarily driven by the need to provide higher bypass engines, which are more fuel-efficient. You get more power from less fuel burned, which saves the airline money and of course, it's more environmentally sustainable. In fact, on an average flight, it takes to London [from Astana], a 7.5-hour flight, we can save up to 20-25% more fuel than would have been burning in the past times. So that's very good. The problem with that is that the engine technology is relatively new, complex and it has been subject to reliability issues which are ongoing and so we're not getting quite the efficiency or the sustainability readings that we had hoped for. But those problems will resolve themselves in time and therefore we can expect to get the full benefits both in terms of economics and the environment as we go forward.
Q: What green technologies or sustainability initiatives is Air Astana adopting to contribute to Kazakhstan's net-zero goals?
A: We were one of the first movers to bring in the Airbus neo long-range aircraft. In fact, we were the first airline to sign for those aircraft at Paris Air Show ten years ago. They are significantly better, more optimal than the previous engine technology that was deployed on aircraft on those long routes and we will continue to introduce those aircraft in order to meet the sustainability targets.
The manufacturers are working on enhanced technology in terms of aerodynamics, in terms of wing design, in terms of engine design, as we go forward. But inevitably the significant portion of our realisation of net zero will come from carbon credits and the CORSIA scheme (Carbon Offsetting and Reduction Scheme for International Aviation), which has been introduced and endorsed by the United Nations and all member states.
China has approved a number of rare earth export licences, a move that could provide modest relief to global manufacturers struggling with supply disruptions.
But with export volumes still sharply down and no transparency on which firms benefit, Europe's automotive industry remains vulnerable to further disruption.
At a press conference on Thursday, China's commerce ministry confirmed it had approved 'a certain number' of export licence applications for rare earths and magnets.
These minerals are used in an array of high-tech products such as smartphones and jet engines.
Rare earths such as neodymium, dysprosium and terbium are indispensable for producing lightweight, high-efficiency motors in electric and hybrid vehicles.
China's announcement follows months of tension sparked by Beijing's decision in April to impose new export controls on seven rare earth elements and related products — just days after Washington introduced steep tariffs on Chinese goods.
According to commerce ministry spokesperson He Yadong, China will 'continue to strengthen the review and approval' of licence applications and remains 'willing to enhance communication and dialogue' on export controls.
The updated tone from Beijing also arrives just weeks before a major EU-China summit set for 24 to 25 July in Beijing, commemorating 50 years of diplomatic relations.
Chinese customs data shows the stark impact of the restrictions.
Exports of rare earth magnets plunged 74% in May compared to a year earlier, the steepest drop in over a decade.
Shipments to the United States fell by 93%, according to a Wall Street Journal analysis.
Total export volumes for May stood at just 1.2 million kilograms, the lowest since the start of the COVID-19 pandemic in early 2020.
Earlier April exports also dropped by 45% year-on-year.
JL Mag Rare-Earth, a major Chinese magnet supplier to Tesla, Bosch and General Motor, said last week that it had begun receiving licences for shipments to the US, Europe and Southeast Asia.
Since April, hundreds of export licence applications have been submitted to Chinese authorities, but only about one-quarter have reportedly been approved.
Some firms have encountered requests to disclose IP-sensitive information, while others have faced outright rejections based on unclear procedural grounds.
ING economist Rico Luman indicated that with 'nearly 70% of global rare earth production and more than 90% of processing taking place in China, the world remains heavily reliant' on the country.
Though rare earths are not geologically scarce — cerium, for instance, is more abundant than copper — their extraction is costly, and mineable concentrations are rare.
"It's not a question of scarcity, but of concentration," Luman added.
China also supplies more than 90% of the world's demand for rare earth permanent magnets, frequently used in electric motors and wind turbines. Without access to these materials, the European automotive supply chain risks paralysis.
The automotive sector relies heavily on rare earth magnets for electric motors, power steering, sensors and other components used in both combustion and electric vehicles.
'China's export restrictions are already shutting down production in Europe's supplier sector,' Benjamin Krieger, Secretary General of CLEPA, warned earlier this spring.
His call for 'transparent, proportionate' licensing remains relevant, even as some licences begin to clear.
The European Chamber of Commerce in China confirmed that while some progress has been made, challenges persist.
'The situation is improving, although the percentage of cleared licences does vary. Additionally, even once the licence is given, delays can still be seen in customs clearances,' said Adam Dunnett, the Chamber's secretary general.
Beijing's latest move to ease export restrictions on key components for the automotive industry offers only limited relief to a sector under strain.
The European automotive industry, already grappling with competition from lower-cost Chinese electric vehicles, remains vulnerable to material shortages, delays and discretionary actions from Beijing — thereby reinforcing China's leverage in global trade negotiations.