Asiana, which already operates the no-frills Air Busan Co., said concerns of its rivals are groundless, arguing that the new carrier will generate more demand for flights. (Image courtesy of Wikimedia Commons)
SEOUL, March 22 (Korea Bizwire) – South Korea’s budget carriers are taking joint actions against the country’s No. 2 flag carrier Asiana Airlines Inc.’s move to start another low-cost airline this year, citing negative effects on the industry they say is near saturation.
Jeju Air Co., the country’s top budget carrier, as well as Eastar Jet Co. and T’way Airlines, last week asked the Ministry of Land, Infrastructure and Transport to stop Asiana from establishing the new company, Seoul Air.
“The launch of a new budget carrier will weaken the competitiveness of air carriers rather than benefit consumers,” they said in a joint letter. “Thus, (the ministry) should not approve (Asiana’s move to launch a new carrier).”
The ministry said it will review the impact on the market “in many ways” as soon as Asiana hands in its finalized business plan.
Asiana, which already operates the no-frills Air Busan Co., said concerns of its rivals are groundless, arguing that the new carrier will generate more demand for flights.
“While there are worries that a new carrier may eat into the existing market, the combined size of the industry will grow eventually,” an official from Asiana Airlines said. It noted that other global flight giants, such as Japan’s ANA, also hold multiple affiliates.
Seoul Air is expected to concentrate on short-distance flights, such as to Japan, while Asiana focuses its efforts on more distant destinations. The company said it aims to kick off the new carrier in the second half of this year.
