Return of tour groups from China propels Korean businesses into action

Industry

Published: 15 Aug. 2023, 18:38

Return of tour groups from China propels Korean businesses into action

Chinese group tourists arrive in Incheon International Airport from China on Tuesday. [YONHAP]

Airlines and retailers are preparing to welcome tourist groups from China by expanding air routes and rolling out promotions with K-pop stars after China ended a six-year hiatus by lifting restrictions on group tours to Korea.

The robust demand from Chinese tourists, who once contributed up to 8 million annual visits to Korea, has ignited a wave of expectations. The forthcoming national holidays in China, which include the Mid-Autumn Festival and National Day which run between Sept. 29 and Oct. 6, are expected to usher in a substantial influx of Chinese visitors.

Korean Air Lines, the largest flag carrier in Korea, is reintroducing services on the Incheon-Wuhan and Incheon-Weihai routes next month. Such routes had been suspended for over three years during the Covid-19 pandemic. The Wuhan route will operate three times weekly commencing Sept. 24, while the Weihai route will offer four weekly flights starting Sept. 27.

Initially, Korean Air had planned a reduction in flights to China in response to lackluster demand. It had announced its decision to halt operations on the Gimpo-Beijing route, starting in August, yet chose to continue services on these routes. However, it still halted the Incheon-Xiamen route from Aug. 9, which will remain inactive until Oct. 28.

Even the low-cost carriers (LCCs), which previously directed focus toward routes to Japan and Southeast Asia, are now preparing for an extension of routes to China.

The largest Korean LCC, Jeju Air, launched new flights along the popular Jeju-Beijing route on Aug. 2. It plans to augment seat availability on Chinese routes as soon as it introduces the advanced B737-8 aircraft. Jin Air is deliberating the revival of its Jeju-Xi'an route in the latter half of the year, while Air Seoul may expedite the launch of routes to Hong Kong and the Shandong Peninsula, originally earmarked for October.

Nevertheless, the aviation sector is proceeding with cautious optimism as it gauges the demand for Chinese tourism in Korea before embarking on route expansions.

Asiana Airlines, having had a notable share of its routes going to China before the onset of Covid-19, temporarily suspended flights on the Gimpo-Beijing route on July 6 and the Incheon-Shenzhen route on July 8. These suspensions will remain in effect until Oct. 28.

"We will operate flights flexibly while monitoring the market trend," an Asiana Airlines spokesperson said. "We will add flights once the demand is secured."

Industry insiders anticipate heightened visibility for China routes in the aviation sector beginning at the end of September as it coincides with the Chinese National Day holiday.

"Once travel agencies present group tourism packages to Korea to domestic airlines, we believe there will be an expansion of supply," an official from the Ministry of Land, Infrastructure and Transport said, while adding, "Airlines are expected to observe the genuine recovery of travel demand before proceeding with formal requests for route expansion."

A Chinese language guide is displayed in front of a duty-free shop in Seoul on Monday. [YONHAP]

The retail sector, on the other hand, including duty-free shops and department stores, is preparing for the much-anticipated return of Chinese tourists by enlisting K-pop idols as advertisement models.

Hyundai Department Store Duty Free said that it appointed the K-pop girl band NewJeans as exclusive models for television and outdoor advertisements over the upcoming year, along with participation in various marketing campaigns. The company has recently expanded its presence in airport duty-free operations by twice its previous size. It plans to introduce highly sought-after luxury brands, popular among tourists, to downtown duty-free outlets.

"As group tourism from China resumes, we foresee an uptick in customers at duty-free stores," a Hyundai Department Store Duty Free spokesperson said. "By enlisting New Jeans as our models, we aim to inject renewed vigor into the duty-free industry."

Lotte Duty Free Store, which only operates downtown stores, is planning to hire more Chinese-speaking staff in October when Chinese group tours are expected to come in full force.

Travel and hospitality enterprises have tailored offerings to cater to Chinese tourists.

ModeTour is presently evaluating the domestic tourism infrastructure, encompassing hotels, shopping centers, and dining establishments. In collaboration with the Korea Tourism Organization and local authorities, it is developing region-specific travel packages.

Lotte Tour Development is planning to recruit an additional 400 staff members for the casino at its Jeju Dream Tower resort. It has revamped the table ordering system across all 14 dining venues at Grand Hyatt Jeju to receive orders in Chinese. Moreover, select venues have extended operating hours past midnight, allowing tourists to savor their evenings.

BY SEO JI-EUN, KIM MIN-SANG [seo.jieun1@joongang.co.kr]