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Korean Air hikes fares for summer
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페트라 |
작성일 : 2010-07-13
조회수 : 4,409 |
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Move to affect flights to U.S., Europe and Australia
July 12, 2010 |
Korean Air, the country’s biggest airline, has proposed hiking fares by 5 to 10 percent on some of its most popular international routes just as the summer holiday season is hitting its peak.
The Ministry of Land, Transport and Maritime Affairs said yesterday that it had received notification about the proposed fare increase about two weeks ago from Korean Air.
The fare increases, the first in four years for basic rates, would affect flights to the U.S., Europe and Australia, among other destinations starting from Aug. 1.
Airfares on these routes are notification-based and do not require approval from the ministry.
For flights to the U.S., Canada and Brazil, passengers could pay up to 5 percent more. Those traveling to France, Germany, the U.K., Australia and New Zealand could face fare increases of up to 10 percent.
Korean Air officials told Yonhap News Agency that “recent increases in costs have not been reflected in flight fares, and we plan to renovate the airliners to enhance the convenience of our passengers.”
The officials gave no further details about what type of cost increases had led to the price hike.
Korean Air had earlier planned to raise fares for flights to Japan, China and Southeast Asia, but the transport ministry refused to allow the fare hike. Airfares on these routes must be approved by the ministry.
Analysts say the fare increase is well timed as passenger traffic this summer is expected to rise with the recent economic recovery.
According to Justice Ministry data, passenger traffic by Koreans into and out of the country increased by 32 percent during the first half of this year from the same period in 2009.
The Justice Ministry, which is in charge of immigration controls at airports, reported that 5.6 million Koreans had traveled overseas during this period, with the top three destinations being China, Japan and the U.S.
A survey by Incruit, an online employment and human resources site, says 70 percent of Korean workers plan to go abroad for vacation this summer. This compares to just 54 percent at the same time last year.
Airline industry analysts say that the decision last week by the Bank of Korea to raise interest rates may also encourage more overseas vacations since the rate hike is likely to result in a stronger Korean won, making foreign travel cheaper for Koreans.
Korean Air reported record sales and operating profits in the first quarter, of 2.6 trillion won ($2.3 billion) and 220.2 billion won, respectively.
Analysts say the airfare hike could result in the carrier breaking the 1 trillion won mark in operating profits this year. It is not known whether Asiana Airlines, Korea’s second-largest carrier, will follow suit.
By Kim Hyung-eun [hkim@joongang.co.kr]
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