Korean Air's mileage program revamp halted after outrage

Industry

Published: 20 Feb. 2023, 19:00 Updated: 21 Feb. 2023, 18:28

Korean Air's mileage program revamp halted after outrage

Korean Air Lines' check-in counter for Morning Calm members, which is Korean Air’s frequent flier program [YONHAP]

A Korean Air Lines plan to revamp to its mileage redemption system from region-based to distance-based, scheduled for April, has been tentatively postponed following backlash from consumers and criticism from the government.

“We are reviewing our new mileage plan,” a spokesperson for Korean Air confirmed to the Korea JoongAng Daily on Monday. “There’s been a negative response to this from the public, and it has tentatively been put off.”

Korean Air had planned to change the terms of its Skypass frequent flier program, redeeming mileage based on flight distance rather than region for reward flights and upgrades, starting April 1. It was first announced at the end of 2019, but the introduction has been postponed due to the Covid-19 pandemic.

This new policy would require long-distance travelers to spend more mileage on certain routes.

For a one-way flight between Incheon to New York — the most popular route — the redemption was expected to rise 28.5 percent to 45,000, compared to the current 35,000 miles needed for an economy seat.

For Hawaii, passengers would need 32,500 from 35,000 miles currently needed for an economy seat.

New York and Hawaii, which had been tied under the same zone group, would be under different mileage deduction rate according to the new policy.

“Everyone in my family is unhappy with the mileage policy change,” said a 30-year-old Korean office worker, who has been a member of Morning Calm — Korean Air’s frequent flier program — for 17 years.

“My older sister, for instance, flies to the United States by Korean Air twice a year because of her job, but greater mileage deduction would mean less benefits from the flights,” he said. “With the new policy, it feels that Korean Air is treating longtime fliers like my family as a captive consumer base.”

Citizens United for Consumer Sovereignty issued a press release criticizing the new mileage redemption rate, saying it is "clearly undermining the value of consumer mileage and infringes on rights" and that the airline should "immediately withdraw its plan."

Land and Transport Minister Won Hee-ryong speaks during a meeting of economy-related ministers at the government complex in Sejong on Monday. [NEWS1]

Along with public's backlash, Korean Air also faced increasing pressure from the government.

"Korean Air was able to maintain itself during the pandemic with the support of the public," Minister of Land, Infrastructure and Transport Won Hee-ryong, who oversees the aviation affairs, said in a meeting with reporters on Sunday. "Instead of running a thank-you promotion for customers, the airline has rather come up with a plan increasing dissatisfaction."

In a Facebook post last Wednesday, Won lashed out that "the Korean Air’s new mileage reform plan is to drastically cut the value of mileages hard won by customers."

"Even with an all-time high record profits, the airline is neglecting its customers," describing the program as being "all flash and no substance."

The problem is that the mileage deduction rate has been increased around long-distance routes that are difficult for low-cost carriers (LCCs).

For long-haul international destinations, Korean Air, which is the largest flight carrier in Korea, flies more than half of the total flights departing from Incheon. Considering the flights operated by the Asiana Airlines, which is being acquired by Korean Air, the two carriers are basically the only options to choose.

Mid- and short-distance destinations, such as to Japan and Southeast Asia, are covered by many low-cost carriers.

"In fact, for short-distance travels, many people use Korean Air only for business trips, and most of the time they take LCCs," said 25-year-old Kim Jung-hyun, a resident living in Seocho District, southern Seoul. "But the renewed mileage program gives less benefit for long-distance travels, which are actually where most miles are spent."

Korean Air had proposed an additional measure to expand the number of award ticket seats and operate special flights with high ratio of seats purchased with miles.

Han Ki-jeong, chairman of the Fair Trade Commission said Monday the commission is “looking into the fairness issue over the provision” of the Korean Air’s mileage system.

BY SEO JI-EUN [seo.jieun1@joongang.co.kr]