[REPORTER'S DIARY]Air Routes Unleash Dog Fight

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[REPORTER'S DIARY]Air Routes Unleash Dog Fight

Korea's two airline companies are up in arms over the allocation of new flight routes and extra flights on existing routes. Korean Air has accused the government of favoring Asiana Airlines.

The latest controversy arose from the allocation of new routes and flights by the Ministry of Construction and Transportation that gave all 21 new weekly flights between Seoul and Tokyo to Asiana. Additional flights on the coveted route were one of the new allocations authorized by the ministry on Wednesday, which involved a total of 73 extra flights weekly in all.

The ministry said there had been a large discrepancy on the Tokyo route in favor of Korean Air, which operated 28 flights a week compared with just five by Asiana. The expected revenue from the new routes that went to Korean Air is higher than that from Asiana's new routes, it added.

But a closer look at the newly authorized schedules gives a hint why Korean Air is crying foul. In terms of profit, Asiana stands to win big from the new routes, even by gaining just two new allocations compared with the 14 that went to Korean Air.

The Seoul-Tokyo route is just two hours in duration but a round trip ticket sells for more than 500,000 won ($388). Flights to Tokyo are almost always packed.

A flight to Europe or North America takes well over 10 hours but a round trip ticket can be had for just over 1 million won. The profitability of the other routes awarded Wednesday failed to excite the airline. "We got all the duds," is what one Korean Air official said.

There is criticism that little attention was paid to the comparative fleet size of the airlines. Korean Air has 97 passenger planes in its fleet; Asian has 52. But the new routes will boost the number of Asiana flights to more than 80 percent of Korean Air's, giving them greater productivity and profitability.

The Transportation Ministry said its Wednesday decision was based on airline policy drawn up in 1999. The policy provides for a 6 to 4 ratio as an adequate breakdown for Korean Air and Asiana flight operations.

It prescribed a preference in authorizing new long haul routes to Korean Air and short distance routes to Asiana. It also gave preference when adding new flights to existing routes to the airline that operates fewer flights on those routes. These are guidelines that Korean Air has consistently maintained as unduly favoring Asiana and has demanded that they be revoked.

"The airline market is different now," Korean Air said, "and Asiana has gone through significant growth."

Asiana was founded in 1988. It is not surprising at all that there would be furious discontent when Wednesday's decision, based on a set of long disputed guidelines, was made.

The ministry is overdue on drawing up a set of new guidelines that incorporates the current positions of the airlines and the opinions of airline industry analysts. Obviously, this must be done through a process that is transparent and reliable.



The writer is a reporter of the JoongAng Ilbo.

by Kang Kap-saeng

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