This file photo provided by Air Premia shows its B787-9 passenger jet.
SEOUL, Sept. 15 (Korea Bizwire) — Air Premia Inc., a South Korean “hybrid” budget carrier, will operate five long-haul routes by the end of next year to compete with bigger rivals as travel demand recovers amid eased COVID-19 virus curbs, its CEO said Thursday.
Air Premia will begin services on the Incheon-Los Angeles route from Oct. 29, while considering four long-distance routes to New York, San Francisco, Frankfurt and Paris during 2023, the company’s CEO Yoo Myung-sub said in an interview with Yonhap News Agency.
Air Premia will be the first domestic low-cost carrier (LCC), which offers flights on such long-haul routes.
To serve the routes, the company plans to increase the number of chartered planes from the current one B787-9 Dreamliner to three B787-9s by December, five by 2023 and 10 by 2025.
“Beefing up the fleet with the B787-9 only will help the company maintain high efficiency in terms of fuel costs and safety,” Yoo said.
The company will also provide the economy class only on its planes at “reasonable” prices to win price-sensitive customers away from full-service carriers (FSCs), the executive said.
Long-range routes have long been dominated by the country’s two FSCs — Korean Air Lines Co. and Asiana Airlines Inc. Local budget carriers have mainly served short and mid-haul routes to China, Japan and Southeast Asia in past decades.
“Competing with FSCs won’t be easy but we will focus on expanding services on long-distance routes and winning more cargo deals to ride out the pandemic and achieve profitability,” said Yoo, who formerly served as marketing executive at Korean Air.
This photo taken Sept. 15, 2022 shows Air Premia CEO Yoo Myung-sub during an interview with Yonhap News Agency after a press conference on the budget carrier’s new route plans held at the InterContinental Seoul COEX hotel in southern Seoul. (Yonhap)
The company expects to report 374 billion won (US$270 million) in sales next year, sharply up from 79 billion won this year. It aims to achieve sales of 860 billion won in 2026 based on its expanded fleet and international routes.
“COVID-19-related travel restrictions are expected to ease further, but travel demand to Japan and China has yet to come back to support LCCs. High jet fuel costs and the weakening won have emerged a major worry for them,” he said.
Of the mid-haul routes, the company plans to offer flights on the route from Incheon to Ho Chi Minh City on Oct. 6, the routes to Bangkok and Tokyo within this year, and the route to Hanoi by early next year.
The company is also considering providing services on the routes to Hawaii, depending on demand, he said.
In July, the carrier began to offer services on its first outbound passenger route from Incheon to Singapore.
“To finance the fleet and route plans, the company has attracted 166.7 billion won and is in talks with some strategic investors for further investments,” the executive said, adding a capital injection from existing shareholders is possible.
Air Premia began passenger-carrying services on the domestic Gimpo-Jeju route in August last year, one month after it obtained government approval for offering commercial flight services.
But it initially transported only cargo on the international routes from Incheon to Singapore, Ho Chi Minh City, Bangkok and Kyrgyzstan, as there was no passenger travel demand due to the pandemic.
South Korea has two FSCs and 10 LCCs, including Jeju Air Co., Jin Air Co., Air Busan Co., Air Seoul Inc., Eastar Jet, T’way Air, Fly Gangwon, Aero K Airlines Co. and Air Incheon Co.
Air Incheon is a cargo-focused carrier, and the nine others are passenger ones.
(Yonhap)
