Korea’s Eastar Jet to operate 10 B737s by YE23 – CEO

17.03.2023 – 01:25 UTC

Eastar Jet (ESR, Seoul Gimpo), which is set to resume operations on March 26 after a three-year break, plans to increase its fleet to ten aircraft by the end of this year, including three B737-8s, as it works towards relaunching international flights, CEO Cho Joong-seok revealed during a news conference.

Cho unveiled the restarting budget carrier’s new five-year business plan to reporters on March 14. Eastar already has three dry-leased B737-800s ready for operations and is in talks with lessors to add two more in the first half of 2023 and a further five Boeing aircraft – including the three MAX jets – in the second half.

The company reacquired its air operator’s certificate (AOC) last month and has begun ticket sales on its website for the domestic route Seoul Gimpo-Jeju, so far up to October. International routes will follow, likely to Taipei Sung Shan in Taiwan, to Tokyo Narita, Osaka Kansai, and Fukuoka in Japan, and to Viet Nam, Thailand, and China (Seoul…

Campaign to base merged S Korean LCC in Busan

14.03.2023 – 23:28 UTC

A grassroots campaign is underway in Busan, South Korea, to lock in that city’s airport as the headquarters of a new “integrated” low-cost subsidiary of Korean Air (KE, Seoul Incheon). Proposed in 2021 and still to be finalised, the move would see Air Busan, Air Seoul, and Jin Air merge to become one carrier.

That merger is a by-product of the proposed merger between Korean Air and Asiana Airlines (OZ, Seoul Incheon). Air Busan and Air Seoul are subsidiaries of Asiana while Jin Air is a Korean Air subsidiary. Once the proposed merger of the two parent airlines is complete, the three budget carriers would become Korean Air subsidiaries and that airline wants to fold them into a single operating brand.

As reported in Korean news outlets, the Gimhae Airport Hub Airport Citizen Promotion Team in Busan held a media conference on March 13 to publicise their efforts to secure the southern city as the headquarters. Air Busan is currently based in the city, Air Seoul in the capital, and Jin…

S Korea audit authority drops $53.6mn operating lease tax

14.03.2023 – 03:22 UTC

South Korea’s Board of Audit and Inspection (BAI) has reversed an earlier decision to tax eleven local carriers KRW70.2 billion won (USD53.6 million) in relation to operating leases.

In 2022, the board imposed the taxes without making a distinction between financial leases and operating leases regarding imported aircraft. According to the News 1 outlet, as of July 2021, the 11 airlines had registered a total of 381 aircraft, of which 206 (54.1%) were introduced as operating leases.

The BAI, the country’s top audit institution, had argued that airlines bringing in aircraft on operating leases were not paying so-called acquisition taxes, only registration and licensing taxes, and that the National Tax Service of Korea was not taking measures to rectify this. How it settled on its KRW70.2 billion taxation demand was not specified.

However, the Ministry of Security and Public Administration asked it to reconsider its ruling. Details are sketchy on the grounds for the ministry’s request, with the report saying only that it was “dissatisfied with the results of the audit.” Following that request, the BAI changed…

EU pushes back Korean Air-Asiana merger ruling to mid-3Q23

09.03.2023 – 23:19 UTC

The European Union (EU) has extended the deadline to make a provisional decision regarding the merger of Korean Air (KE, Seoul Incheon) and Asiana Airlines (OZ, Seoul Incheon). On March 7, the deadline was pushed back 20 working days from July 5, 2023, to August 3. No reason was provided for the delay.

Korean Air wants to buy a 63.88% stake in Asiana and merge the two airlines in a KRW800 billion won (USD607.5 million dollars) deal that would see it become one of the biggest airlines in the world. However, the merger depends on approval from competition authorities in multiple jurisdictions. Many, including recently the United Kingdom, have okayed the merger (albeit often with conditions), but three key markets, Japan, the US, and the EU, are yet to give approval.

In February, the EU said it would open an “indepth investigation” into the merger after identifying competition concerns in both the cargo and passenger markets on routes between South Korea and EU member countries. In a statement, the EU pointed to…