Airports operator will support LCCs

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Airports operator will support LCCs

Korea’s low-cost carriers (LCCs) will be flying high after Korea Airports Corporation (KAC) said it would support them to raise safety standards by increasing cooperation while cutting ground costs at rural airports.

The KAC, a state-run company that manages Korea’s 14 airports, said yesterday that it will create a collective purchasing system with the five LCCs for jet fuel and aircraft repairs.

The decision comes after a law was revised in the past three months to give the KAC permission to conduct business, which was previously very restricted because it is a state-run entity. Some of the revised laws were announced Wednesday.

The KAC said that collectively purchasing jet fuel will make the LCCs more financially stable as fuel costs account for the largest portion in their total operating costs. LCCs could save a total of 1.8 billion won ($1.75 million) per year once the system is in place, the airport operator said.

The KAC said it will provide a shared hangar at each airport for LCCs that don’t have their own facilities.

“Korean LCCs’ repair costs are higher than foreign LCCs and local flag carriers,” the KAC said in a statement. “It accounts for 20 percent of their total costs, because since there are not enough repair facilities, most of them go overseas.”

KAC said that this money-saving plan could eventually allow for LCCs to lower their ticket prices. The airport-managing organization said that Korean LCCs’ prices are high compared to LCCs in other countries.

The revised law also means that KAC can provide ground operation services to all LCC aircraft.

“Not only can we secure safety by supporting ground operation services in rural airports, but this will also attract local air carriers to operate more often from or to small airports and will benefit customers,” said the KAC. “We are currently discussing which airport should be serviced first.”


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