Asiana receives right to fly to Mongolian capital

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Asiana receives right to fly to Mongolian capital

The Incheon-Ulaanbaatar route, flown by only one Korean carrier for 28 years, is being opened to competition. The end to the near monopoly is expected to lower the cost of tickets, currently some of the most expensive per kilometer in the region.

Late Monday, the Ministry of Land, Infrastructure and Transport granted Asiana Airlines the right to fly three times a week to the Mongolian capital. The new service will add 844 seats to the route.

Korean Air has been the sole Korean carrier between Incheon and Ulaanbaatar, and the service has been a cash cow for the company. Tickets are almost twice as expensive as regional flights of similar durations and tickets are sometimes hard to get.

MIAT Mongolian Airlines, the flag carrier, also provides direct connections between the two cities, while passengers can fly from Incheon to Ulaanbaatar via Beijing on Air China.

In addition to new Incheon-Ulaanbaatar permission, Air Busan, 44.17 percent owned by Asiana, was granted the right for a once-a-week service from Busan to Ulaanbaatar.

Competition for the right to fly the Ulaanbaatar route was intense, with Jeju Air, Korean Air affiliate Jin Air, T’Way Air and Eastar Jet all in the running for the slot.

Asiana’s victory is seen as a boost for the carrier and is expected to help improve its profitability.

The ministry said in a statement that it secured the rights to an additional three flights a week between Incheon and Ulaanbaatar after talks with the Mongolian government in January last year. It said it decided to allow Asiana the added frequencies to break the monopoly structure and in the hopes service quality will improve and airfares will fall with the increased competition.

Korean Air is protesting the government’s decision. It argues that the air services agreement with Mongolia, which allows for six flights a week to Ulaanbaatar without any limits on seats, is being violated. It said the government action unfairly shifts capacity to another airline, thus violating the principle on protecting trust.

In 1991, the Korean government and the Mongolian government agreed to allow only one carrier from each country to travel between the two: Korean Air was chosen to represent Korea. Since 1996, Korean Air has been traveling to Mongolia six times a week. It currently offers 1,656 seats to the destination. With three more flights a week, seats available will now total nearly 2,500.

Travelers have been calling for more capacity on the route for some time, while consumer complaints about pricing have been frequent. Last year, 330,000 passengers traveled between Korea and Mongolia, and ticket demand has been increasing more than 10 percent a year.

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