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KAL-2003-06 NEWS-APL ORDER
KAL-2004-02 NEWS 777-200ER
KAL-2004-05 NEWS -747-400ERF ORDER
KAL-2004-09 NEWS 737-9B5
KAL-2005-01 2004 STATS
KAL-2005-11-NEWS OKAY AIR-A
KAL-2006-02 NEWS FC STRIKE
KAL-2008-WORLD TOP 10 CARGO
KAL-2009-12 747-8I ORDER
KAL-2009-12 747-8I ORDER-A
KAL-2009-12 CARGO TO VIETNAM
KAL-2011-01-2010 WORLD TOP TRAFFIC
KAL-2013-03 - SAMSUNG S4 SMARTPHONE
KAL-2013-03 - TO MALE THE MALDIVES
KAL-2013-06 - 747-8I 777-300ER PARIS
KAL-2013-10 - BOEING ORDER
KAL-2016-05 - 777 Engine Fire.jpg
KAL-2018-01 New Incheon Airport Terminal.jpg
KAL-AIRPORTS S KOREA - 2013-03
KAL-CABIN ATTENDANT-2005-01 NEW UNIFORM
KAL-FLIGHT CREW AD-2010-12
KAL-FLIGHT CREW FEMALE-2008-11
KAL-MAINTENANCE MRO AD
FORMED IN 1948. KOREAN AIR (KAL) WAS ESTABLISHED WHEN THE KOREAN GOVERNMENT TOOK CONTROL OF KOREAN NATIONAL AIRLINES (FOUNDED IN 1948). THE PARENT COMPANY IS THE HANJIN GROUP, WHICH STARTED IN 1945 AS A 1-MAN TRUCKING OPERATION. >50 YEARS LATER, NOW IS A TRANSPORTATION & INDUSTRIAL GIANT, WITH SHIPPING, FINANCE, HEAVY ENGINEERING & TELECOMMUNICATIONS. THE HANJIN GROUP TOOK CONTROL OF THE STRUGGLING CARRIER IN MARCH 1969. HANJIN TOOK OVER (KAL) IN 1969 WHEN IT JUST HAD 8 AIRPLANES: DC-3'S, DC-4'S & 1 DC-9. LONG-HAUL FREIGHT OPERATIONS WERE INTRODUCED IN APRIL 1971 FOLLOWED BY PASSENGER SERVICE TO LOS ANGELES IN APRIL 1972. KOREAN AIR (KAL) PULLED IN 40% OF HANJIN'S $9.89 BILLION IN 1994 REVENUE. LATER (KAL) BECAME THE 3RD LARGEST AIRLINE IN ASIA. HANJIN AS A MAJOR INTERNATIONAL SHIPPING COMPANY, PLACES HEAVY EMPHASIS ON AIR FREIGHT, AND WAS 28% OF (KAL)'S TOTAL REVENUE. DOMESTIC & INTERNATIONAL, SCHEDULED & CHARTER, PASSENGER & CARGO, JET AIRPLANE SERVICES.
AIR OPERATIONS CENTER 6TH FLOOR GANGSEO-GU
SEOUL, 157-712, SOUTH KOREA
THE REPUBLIC OF KOREA (TAEHAN MIN-GUK) WAS ESTABLISHED IN 1948, IT COVERS AN AREA OF 99,016 SQ KM, ITS POPULATION IS 46 MILLION, ITS CAPITAL CITY IS SEOUL, AND ITS OFFICIAL LANGUAGE IS KOREAN.
FEBRUARY 1993: 1992 = +$1.5 MILLION (+$20.2 MILLION) NET PROFIT: +9.2% (RPK) TRAFFIC, +13% PASSENGERS (PAX), +4.6% (FTK) FREIGHT TRAFFIC.
CURRENT FLEET IS 11 747-200F'S, +2 747-400F'S, 2 A300B4'S & 5 MD-11'S TO FREIGHTERS. A300-600B4-622R DELIVERY.
JULY 1993: 747-4B5 (RT581) DELIVERY.
SEPTEMBER 1993: >$1 BILLION, 8/8 ORDERS (FEBRUARY 1997) 777'S "B" MARKET & STRETCH (1ST 4 IN 1997, 2ND 4 IN 1998).
JANUARY 1994: LAST 6 MONTHS = +2.7% PASSENGERS (PAX).
JULY 1994: 1ST 6 MONTHS = +17.7% (RPK) TRAFFIC, +18.2% PASSENGERS (PAX), +20.7% (FTK) FREIGHT TRAFFIC.
JANUARY 1995: 1994 = +15% (RPK) TRAFFIC, +17% (FTK) FREIGHT TRAFFIC.
MAY 1995: 1 CITATION ULTRA (JT15D-5D).
JUNE 1995: 8 ORDERS (1998) 777-300X'S. 3 ORDERS MD-83'S, 160Y.
JULY 1995: 1ST 6 MONTHS = +$100.7 MILLION (+$24 MILLION).
2 MD-82'S (JT8D-217C) DELIVERIES.
AUGUST 1995: 18TH 747-400 DELIVERY.
AUGUST 1995: INCDT: (KAL) DC-9-82 (49418) RAN OFF THE RIGHT HAND SIDE OF THE RUNWAY AT SEOUL, LEFT HAND MAIN GEAR COLLAPSED, = 6 (FC)-(CA)/164 PASSENGERS (PAX) OK.
SEPTEMBER 1995: 1ST MD-11F CONVERSION TO OPERATE SEOUL (SEL) - ANCHORAGE (ANC) - LOS ANGELES (LAX) - (ANC) - (SEL) & OCCASIONALLY TO INDONESIA.
OCTOBER 1995: PLANS TO ADD SERVICES TO AUCKLAND & MEXICO IN NEXT FEW MONTHS & FREIGHT OPERATIONS TO BASEL & BRUSSELS.
NOVEMBER 1995: TO RELIEVE PRESSURE ON PUSAN KIMHAE AIRPORT'S 3-BAY MAINTENANCE HANGAR, WITH A TWO-&-A-HALF BAY TO BE COMPLETED AT KIMPO INTERNATIONAL AIRPORT, INCLUDING $80 MILLION, ENGINE COMPONENT OVERHAUL & MANUFACTURING PLANT.
SHORTAGE OF PILOTS, NOW 77 FOREIGNERS OF 1,300+ FLIGHT CREWS.
NEW ROUTE TO TEL AVIV WITH 747SP.
1 747-400 (PW4056) DELIVERY. 1 MD-83 DELIVERY. 1 A300B4-622R, CHINA NORTHERN (CNA) LEASED.
JANUARY 1996: 4 ORDERS 747-400'S, 7 ORDERS A330'S, 2 ORDERS A340-300'S (IN FEBRUARY 1997). TO SELL 3 DC-10-30'S TO CONTINENTAL AIRLINES (CAL) IN 1996, TO TAKE DELIVERY OF 4 747-400'S (1 FREIGHTER) & 3 MD-83'S; IN 1997: 3 747-400'S (1 FREIGHTER), 2 777'S, & 2 A330'S; IN 1998: 3 747-400'S (1 FREIGHTER), 3 777'S & 2 A330'S; 1999: 3 747-400'S (1 FREIGHTER), 3 777'S, & 2 A330'S; 2000: 4 777'S & 1 A330. PLANS TO SELL 3 DC-10'S & 3 727-200A'S BY APRIL 1996. 1 A300B4-600R (PW4158) & 1 MD-83 DELIVERIES.
APRIL 1996: CODE SHARE WITH DELTA AIRLINES (DAL), TO LOS ANGELES (LAX), CHICAGO (ORD), HONOLULU (HNL), NEW YORK (JFK), & WASHINGTON DULLES (IAD) (L-1011). 747F TO PORTLAND, VIA ANCHORAGE. 3 DC-10-30'S (46912; 46915; 46934) SOLD TO NORTHWEST (NWA). CONVERTED 2 OF 7 OPTIONS FOR A330-300'S TO 2 ORDERS A330-200'S.
JUNE 1996: SOLD LAST 727-281 TO DALLAS AEROSPACE.
COMPLETED SECTION 41 & STRUT STRUCTURAL MODIFICATION ON (RD091) AT PUSAN HEAVY MAINTENANCE BASE.
JULY 1996: 1ST 6 MONTHS = -$309 MILLION: 11.4 MILLION PASSENGERS (PAX) (+8.3%).
1 A300-600R (530) (PW4158), EX-(CUN), 2 YEAR LEASED. 1 DC-10-30F (47922) SUB-SERVICE OPERATED BY (SCA) ON BEHALF OF GEMINI AIR CARGO, EX-LUFTHANSA (LUB). 2 ORDERS (AUGUST 1998) A330-200'S (PW4000).
AUGUST 1996: CANCELLED 2 REMAINING A300-600R'S (PW4158).
SEPTEMBER 1996: PRESIDENT OF KOREA & KOREAN AIR (KAL) PRESIDENT FLEW A 747-400 VIP FLIGHT TO LATIN AMERICA.
TO ANCHORAGE, NEWARK, NEW YORK (JFK), & BOSTON (747-400).
H K CHEON, SENIOR VP ENGINEERING (KIMPO).
1 747-400F (RR861) DELIVERY. 1 A300-600R (PW4158) (750), EX-CHINA NORTHERN (SHY), PAINTED BY (AMECO) (BEJ).
DECEMBER 1996: 1996 = 23.426 BILLION (RPK) TRAFFIC (#18 HIGHEST IN THE WORLD).
GEMINI AIR CARGO DC-10, WET-LEASED, LIMITED TO 179 DAYS LEASE BY USA DEPARTMENT OF TRANSPORT (DOT) INSTEAD OF 1 YEAR REQUESTED, DUE TO WORLD AIRWAYS (WLD) OBJECTION.
JANUARY 1997: 1996 = -$249.40 MILLION (+$137.00 MILLION).
2 747-200'S (RD071, RD072) TO BE OPERATED SHORT RANGE TO CHEGOO ISLAND FOR 18 MONTHS, 1 HOUR FLYING & 7 CYCLES REVISING THE MAINTENANCE PROGRAM. WILL RETURN AIRPLANES TO BOEING (TBC) IN 1998.
MARCH 1997: (KAL) CARGO OPERATIONS ARE 3RD LARGEST IN WORLD. CURRENTLY SERVES 89 CITIES, IN 33 COUNTRIES, WITH 112 AIRPLANES.
1ST 777-200 IGW (PW) OF 7, THIS YEAR, +11 WIDEBODY DELIVERIES IN 1998. 4 ORDERS (/98) A330-200/-300'S (PW4000) FOR TOTAL 13 ORDERS. 1 747-400 (PW4056), 1 A330-300 (PW4168) & 2 777-200IGW'S (PW4090) DELIVERIES.
APRIL 1997: 17,139 EMPLOYEES (INCLUDING 4,611 FLIGHT CREW (FC) & 4,741 MAINTENANCE TECHNICIANS (MT).
747-400 DIRECT TO DENVER, 15TH US GATEWAY.
FISCAL YEAR (FY) 19/96 = -$245.6M (1ST LOSS IN 34 YRS): FUEL COSTS +30%.
MAY 1997: A330-322 (172) (1 MORE IN 1997, 5 IN 1998).
JUNE 1997: TO HARBIN, HEILONGJIANG PROVINCE, IN FAR EASTERN CHINA.
NEW $300M MAINTENANCE, ENGINEERING, FLIGHT OPERATIONS, HEADQUARTERS, AT KIMPO OPENS.
CHAIRMAN CHO COMMENTED THAT 777 FLIGHTDECK WAS MORE ADVANCED THAN A330. 747-400 CHARTERED FOR KOREAN PRESIDENT VISIT TO US, ALONG WITH Y H CHO, KOREAN AIR (KAL) PRESIDENT.
1 747-4B5 DELIVERY.
JULY 1997: AIR TRAVELERS ASSOCIATION AWARDS REPORT CARD "C" RATING FOR SAFETY TO KOREAN AIR (KAL), USING DATA FROM AIRCLAIMS UK.
MOVED INTO NEW $250M, 7 STOREY OPERATIONS CENTER, AT KIMPO AIRPORT, INCLUDING 175,000 SQUARE FOOT MAINTENANCE HANGAR FOR 2 747-400'S & 1 A300.
AUGUST 1997: ACCDT: 747-300 (LINE NUMBER L/N 605, DELIVERED 1984, 49,799 HOURS, 8,433 CYCLES) CRASHED ON LANDING AT GUAM, WHEN AIRPLANE HIT NIMITZ HILL AT NIGHT IN HEAVY RAIN = 228 FATALITIES OF 23/225 FLIGHT CREW/PASSENGERS. NOW, 12 TOTAL HULL LOSSES IN LAST 30 YEARS. 8 DAMAGED AIRPLANES IN LAST 10 YEARS: 3 707'S, 3 747'S, & 2 DC-10'S.
SEPTEMBER 1997: 2 A300-600R'S (PW4158) (611; 613), EX-GARUDA (GIA), (AWW) LEASED. 1 ORDER (4/99) 747-400F (CF6-80C2B1F), (ILF) 10 YEAR LEASED. 747-200F (RR503) RETURNED TO NORTHWEST (NWA). A300B4-103 (014) BROKEN UP.
OCTOBER 1997: 1ST 9 MONTHS = 23,601M RPK (TRAFFIC) (17TH HIGHEST IN WORLD).
TO SELL 5 A300B4'S AND ACQUIRE A300-600R'S. 1ST 777-2B5 (27945) DELIVERY. SELLS 018; 031; 081; TO JAPAN FLEET SERVICE, 024 TO ANSETT WORLDWIDE (AWW), & PARTED OUT 014. 016 PUT IN STORAGE. 2 A300-600R'S (PW4158), EX-GARUDA (GIA) (657; 659).
DECEMBER 1997: GRANTED 180 MINUTES (ETOPS) FOR 777 (PW4090) (TYPICAL SEOUL - ZURICH, & SEOUL - AMSTERDAM.
TO SELL 9 AIRPLANES AND LEASE BACK: 2 747-200F'S, 3 747-400'S, & 4 A300-600'S.
JANUARY 1998: NEGOTIATIONS FOR ATLAS (TLS) 747 STRUT MODIFICATIONS.
LATEST ASIAN ECONOMY DOWNTURNS REFLECTED IN CURRENT 56.4% LF (LOAD FACTOR) (67.7% LF).
GOVT REQUIRES FOREIGN INSPECTION OF ITS OPERATIONS & AIRPLANES, AND TO SELL 12 AIRPLANES >20 YEARS OLD.
NEW CARGO SERVICE TO HO CHI MINH CITY, & MIAMI (MIA), IN 8/98. IN 1999, CARGO SERVICE TO DALLAS/FORT WORTH (DFW), PORTLAND, AND ATLANTA.
AS ONE OF THE WORLD'S LARGEST CARGO AIRLINES, WILL OPEN A CARGO TERMINAL AT SEOUL KIMPO & A NEW CARGO FACILITY AT NEW YORK (JFK) IN COOPERATION WITH AIR FRANCE (AFA), LUFTHANSA (DLH), & JAPAN AIR LINES (JAL). LAUNCHES CARGO SERVICE TO HO CHI MINH CITY (A300F).
2 A300B4-103'S (031; 081) WITHDRAWN FROM USE (WFU).
FEBRUARY 1998: 1997 = -$423.7M.
HEE KYOON CHEON, SENIOR VP SAFETY & SECURITY, EX-SENIOR VP MAINTENANCE & ENGINEERING (M&E); BYUNG SUN LEE, MANAGING VP M&E, KIMPO, REPLACES MYUNG KYOO AHN, WHO RETIRED. SOO BU LEE, EXECUTIVE VP HANJIN HEAVY INDUSTRIES, EX-SENIOR VP KIMHAE; YOUNG WOONG KIM, MANAGING VP ENGINEERING.
TO LET GO -150 FOREIGN PILOTS (FC), FOLLOWING -16 ROUTES.
TO SELL 2 MD-11'S, POSSIBLY TO DELTA (DAL).
MARCH 1998: NEW ROUTES: CHEJU - BEIJING, PUSAN - QINGDAO, TO GUILIN, KUNMING, URUMQI, WUHAN, TAEGU - QINGDAO. FREIGHTER ROUTES TO SHANGHAI, TIANJIN, HO CHI MINH CITY (A300F).
CONTRACT TO FLIGHT SAFETY INTERNATIONAL TO PERFORM AN AIRLINE AUDIT OF MAINTENANCE AND FLIGHT DEPARTMENT PRACTICES, STARTING 3/98 FOR 45 DAYS, WITH 10 PEOPLE, AND FINISH BY MAY 10.
LAYS OFF -10% WORK FORCE, MOSTLY BY EARLY RETIREMENT INCENTIVES. -600 TO LEAVE OF 3,800 IN MAINTENANCE & ENGINEERING DEPARTMENT.
KOREAN PRESIDENT FLIES TO LONDON FOR ASIA-EUROPE MEETING IN SPECIALLY CONFIGURED 747-400.
NORTH KOREA ALLOWS ACCESS TO AIRSPACE OVERFLIGHTS TO ALL NATIONS.
8 ORDERS 737-800'S, (GEH) LEASED, TO REPLACE MD-82'S. 747-200F (HL7453) RETURNED TO (ILF), LEASED TO AER LINGUS (ARL).
APRIL 1998: 17,139 EMPLOYEES (INCLUDING 4,611 FC & 4,741 MT).
(http://www.koreanair.con). FY 1997 = -$281M (-$148.7M).
SELLS A300B4-103 (030).
MAY 1998: OPERATES TO SYDNEY WITH 777, SOME VIA BRISBANE.
JUNE 1998: TO INSTALL ENHANCED GROUND PROXIMITY WARNING SYSTEM (EGPWS) ON ENTIRE FLEET.
27 ORDERS 737-800/-900'S ($2B) (8/00), TO REPLACE 14 MD-82'S AND 12 F 100'S ON DOMESTIC ROUTES. KOREAN AIR (KAL)'S 2ND LARGEST ORDER (1ST WAS 28 747-400'S IN 1986). PHASED OUT 6 A300B4'S IN 1997 & REST SOON. 2 A330-322'S DELIVERIES.
JULY 1998: STARTS CODE SHARE WITH DELTA AIRLINES (DAL), TO BOSTON & NEWARK (KAL) 747).
(IATA) RANKS KOREAN AIR (KAL) CARGO OPERATIONS, 2ND IN WORLD, WITH 5.7M FTK (FREIGHT TRAFFIC), FOLLOWING FIRST PLACE, LUFTHANSA CARGO (LUB) WITH 6.7M FTK FOR 2ND YEAR.
1997 TOP WORLD AIRLINE COMPARISONS:
EMPLOYEES (K): 20 ACN 22; 21 TII 22; 22 PIA 21; 23 AIN 19; 24 ALI 19; 25 VAR 18; 26 JAL 17; 27 KAL 17; 28 ANS 16; 29 SWS 17; 30 GUN 16.
RPK (TRAFFIC) (B): 11 QAN 59; 12 KLM 55; 13 SIA 55; 14 ANA 51; 15 SWA 46; 16 TWA 41; 17 KAL 40; 18 CAT 39; 19 ACN 37; 20 ALI 36.
PASSENGERS (PAX) (M): 6 SWA 50; 7 ANA 41; 8 CAL 39; 9 DLH 35; 10 BAB 34; 11 JAL 32; 12 KAL 26; 13 ALI 25; 14 TWA 24; 15 SAS 21.
FTK (FREIGHT TRAFFIC) (B): 1 FED 9.3; 2 GRC 6.5; 3 KAL 5.7; 4 UPS 5.4; 5 AFA 5; 6 SIA 4.8; 7 JAL 4.2; 8 BAB 3.9; 9 KLM 3.7; 10 CAT 3.6.
(ETOPS) 180 MINUTES FLIGHTS/MONTH (TOTAL): 2 777'S = 60 (214) PACIFIC, (14) ASIA.
AUGUST 1998: US DEPARTMENT OF TRANSPORT (DOT) OK'S CODE SHARE EXPANSION WITH DELTA AIRLINES (DAL) FOR PASSENGER (PAX) & CARGO SERVICES TO PORTLAND, NEW YORK (JFK) - BOSTON, & SAN FRANCISCO (SFO) - HONOLULU (HNL).
KOREAN AIR (KAL) CARGO FLEET HAS 17 AIRPLANES SERVING 30 CITIES IN 20 COUNTRIES.
SOLD 2 MD-11'S PASSENGER (PAX) AIRPLANES.
SEPTEMBER 1998: CODE SHARE WITH AIR FRANCE (AFA), TO PARIS (AFA A340-300: 6F, 42C, 167-204Y; (KAL) 747-400: 12F, 58C, 306Y).
1ST A330-223, 6F, 18C, 234Y, (1ST IN ASIA!). 1ST A330-223 (222) & 2ND (226). A300B4-2C (024) PARTED OUT.
OCTOBER 1998: C Y HWANG, VP MAINTENANCE PLANNING, MOVES TO FLIGHT OPERATIONS. Y W KIM, DEPUTY MANAGING VP MAINTENANCE & ENGINEERING, INCLUDING PLANNING.
>$100M TO BE SPENT ON SAFETY REFORMS, PILOT TRAINING, AND MAINTENANCE OPERATIONS. HIRES FLIGHT SAFETY FOUNDATION, TO CONDUCT INSPECTIONS, AND WILL USE ALLIANCE PARTNER DELTA AIRLINES (DAL), TO REVIEW ITS PROGRAMS & RECOMMEND IMPROVEMENTS TO BRING ITS STANDARDS UP TO THOSE OF LEADING INTERNATIONAL AIRLINES.
INCLUDES INSTALLATION OF AIRCRAFT INTEGRATED MONITORING SYSTEM (AIMS), AIRBORNE COMMUNICATIONS ADDRESSING REPORTING SYSTEM (ACARS), FOR ALL 112 AIRPLANES, AND INSTALLING TRAFFIC COLLISION AVOIDANCE SYSTEM (TCAS) & ENHANCED GROUND PROXIMITY WARNING SYSTEM (EGPWS), FOR ALL NEW AIRPLANES. ALSO, INCLUDES MAINTENANCE ERROR DECISION AID (MEDA) PROGRAM (BOEING DEVELOPED).
1ST 5 MONTHS = 12.2B RPK (-28%), 2.07B FTK (-7.4%), 8.54 PAX (-20%). 1ST 6 MONTHS = +$41M.
3 777 180 MINUTES (ETOPS) FLIGHTS/MONTH (TOTAL FLIGHTS): NORTH/WEST PACIFIC 42 (331); ASIA (48).
8 ORDERS (/00) 737-800'S, GECAS (GEH) LEASED. SELLS 8 MD-82'S (49373; 49374; 49416; 49417; 49418; 49419; 53147; 53148) TO GECAS (GEH) AND LEASED BACK. SELLS 2 747-200'S (20770; 20771) & 2 747SP'S (22483; 22484) (ALL 4 JT9D-7A) BACK TO BOEING, AS TRADE IN FOR 2 747-400'S, 1 747-400F, & 2 777-300'S. A330-322 (241) DELIVERY.
DECEMBER 1998: (DOT) OK'S CARRIAGE OF US MAIL, BY KOREAN AIR (KAL), AS PART OF CODE SHARE WITH NORTHWEST (NWA), TO CHICAGO (ORD), SAN FRANCISO (SFO), & LOS ANGELES (LAX) - SEOUL.
$120M, 10 YEAR CONTRACT, OUTSOURCING FOR IBM SUBSIDIARY, IBM GLOBAL SERVICES KOREA, TO CREATE NEW INFO TECHNOLOGY (IT) INFRASTRUCTURE FOR (KAL).
777-200 DELIVERY, SOLD & LEASED BACK FROM SALE (SIL). DUE TO (PW4098) ENGINE PROBLEMS, DELIVERY OF 777-300 WILL BE ALMOST A YEAR LATE. 3 747-400'S (1155-RM011; 1163-RM871; 1170-RM012) DELIVERIES.
JANUARY 1999: KOREAN GOVT, PRESIDENT KIM USES 777-200 FOR TRIP TO VIETNAM.
1998 = +$246M (-$234M): 19.95B RPM (-19.6%), 5.64B FTM (-11.5%).
FEBRUARY 1999: PROMOTIONS: K S LEE, DEPUTY VP ENGINEERING; H J CHO, VP MAINTENANCE PLANNING; K K PARK, MANAGING VP LABORATORY. Y S KANG, VP QUALITY ASSURANCE SWAPPED WITH W S JANG, VP KIMPO MAINTENANCE CENTER (THESE ARE THEIR NEW POSITIONS).
MARCH 1999: SELLS 2 F 100'S TO TAT (TTR). 1 MD-82 SOLD TO SPANAIR (SPP). 3RD A330-200 (PW4168A) (258), DEBIS AIRFINANCE LEASED. SWITCHED ORDERS FROM 11 737-800'S TO -600'S; & INCREASED 11 737-900'S TO 16.
ACCDT: MD-83 (53485, /96) AT POHANG, KOREA, RAN OFF RUNWAY, DESTROYED.
APRIL 1999: ACCDT: MD-11F CRASHED AFTER TAKEOFF FROM SHANGHAI = ALL 3 FATALITIES +6 KILLED ON GROUND (48409, /92).
AS A RESULT OF RECENT AIR ACCIDENTS, AND LACK OF CONFIDENCE EXPRESSED BY GOVERNMENT, 29 SENIOR EXECS, AT AND ABOVE, MANAGING VP RANK, HAVE HANDED IN THEIR RESIGNATIONS, INCLUDING CHOONG-HOON CHO, CHAIRMAN, WHO WILL BE REPLACED BY CURRENT PRESIDENT & CEO, YANG-HO CHO YI-TAEK SHIM, PRESIDENT & CEO.
17,139 EMPLOYEES. (firstname.lastname@example.org).
(DOT) OK'S CODE SHARE WITH GEMINI (GMN), TO NEW YORK, CHICAGO (ORD), & LOS ANGELES (LAX).
MAY 1999: 2 F 100'S (11387; 11476) RETURNED TO LESSOR, TO AIR GREECE.
JUNE 1999: PARIS AIR SHOW - 2 ORDERS 747-400F'S (PW4000) FOR 05/00. MD-82 (2069-53147, KL7547), RETURNED TO GECAS (GEH).
1998 TOP WORLD AILINES - TRAFFIC RPM (B):
16 CAT 25.26; 17 TWA 24.42; 18 ACN 23.21; 19 ALI 22.10; 20 TII 21.34; 21 IBE 20.19; 22 KAL 19.95; 23 MAS 18.25; 24 SWS 17.43; 25 CDI 16.70; 26 AMW 16.36; 27. VAR 16.25; 28. SAS 12.98.
AUGUST 1999: KOREAN AIR (KAL), & AEROMEXICO (AMX) LIKELY TO JOIN AIR FRANCE (AFA) AND DELTA (DAL), IN A NEW, UNNAMED ALLIANCE GROUP, BEFORE END OF 1999.
1ST 7 MONTHS = 20.43B FTK (FREIGHT TRAFFIC).
1 747-400F (CF6-80C2), ATLAS (TLS) WET-LEASED. A330-300 (PW4168A) RECEIVES (JAA) 180 MINUTES (ETOPS) CERTIFICATION. 2 777-3B5'S DELIVERIES (TO BE USED ON AUSTRALIA/NEW ZEALAND ROUTES). MD-83 (53485) PARTED OUT. A330-322 (256) DELIVERY. 747-4B5 (1083-24600) PARTED OUT FOLLOWING 8/98 ACCIDENT (TO BE USED AS A RESTAURANT IN POHANG, KOREA). 1 777-3B5 (120) DELIVERY.
SEPTEMBER 1999: IN 10/99, TO DENVER (747-400).
OCTOBER 1999: IN 11/99, CODE SHARE WITH MALAYSIAN (MAS), TO KUALA LUMPUR NONSTOP.
TOTAL 180 MINUTES (ETOPS) FLIGHTS (FLIGHTS/MONTH): 5 777'S = 48 ASIA; 795 (24) NORTHWEST PACIFIC.
NOVEMBER 1999: TO SAN FRANCISCO (SFO) (777).
YANG-HO CHO, CHAIRMAN, WAS ARRESTED ON TAX EVASION CHARGES, IN $55M SCAM INVOLVING KOREAN AIR (KAL) & 3 OTHER AFFILIATES OF THE HANJIN GROUP.
BOEING AIRPLANE SERVICES DELIVERS MD-11F, RECONFIGURED AT SAN ANTONIO, TEXAS.
DECEMBER 1999: TO AIRLIFT 25 TONS OF MEDICAL SUPPLIES TO VIETNAM, FOLLOWING LAST MONTH'S 100-YEAR FLOOD. KOREAN AIR (KAL) OFFERS FREE FREIGHTER SERVICE.
SOLD 2 MD-11F'S (PW4158) (48408; 48410), AND 2 A300B4-622B'S (611, HL7519; 613, HL-7520) RETURNED TO ANSETT WORLDWIDE (AWW).
ACCDT: KOREAN AIR (KAL) 747-2B5F (HL-7451, /80 80 51; 22480) CRASHES AND DESTROYED AFTER TAKEOFF FROM LONDON STANSTED (STN) = ALL 4 CREW (FC) FATALITIES - PROBLEMS WITH ATTITUDE DIRECTOR INDICATOR (ADI).
JANUARY 2000: TECHNICAL AUDIT BY TRANSPORT CANADA OF FLIGHT OPERATIONS, MAINTENANCE & CABIN SERVICES.
BOEING AIRPLANE SERVICES DELIVERS RECONFIGURED MD-11F, COMPLETED AT WICHITA.
GOVT GROUNDS 8 747'S >18 YEARS OLD, FOR UNSCHEDULED "C" CHECKS, TO TAKE 15 DAYS WITH 50 PERSONNEL. ALSO, 2 A300F'S, 1 747-200, & 1 747-200F TO BE SOLD BY 4/00. GROUNDINGS WILL SERIOUSLY AFFECT CARGO OPERATIONS, WHICH CONTRIBUTE 30% OF TOTAL REVENUE. 2 A300F4-203'S (CF6-50C2) (277; 292), LEASED 5 YEARS TO MNG AIRLINES CARGO (MCG). 1ST 737-86N, GECAS (GEH) LEASED.
FEBRUARY 2000: 14,500 EMPLOYEES. BY END OF 2001, KOREAN AIR (KAL) WILL HIRE 240 PILOTS (FC) IN 2000, INCLUDING 130 EX-PATRIOTS.
CHO YANG HO, CHAIRMAN, WAS SENTENCED TO 4 YEARS IN PRISON, +$26.7M FINE, FOR TAX EVASION, & (KAL) ALSO FINED HIM # W80B.
737-86N (482-28615, HL7556), (GEH) LEASED. 2ND 747-400F, ATLAS (TLS) WET-LEASED. PLANS TO ADD 31 AIRPLANES: 16 737-800'S, 1 747-400, 4 747-400F'S, 2 777-200'S, 2 777-300'S, & 6 A330-300'S.
MARCH 2000: BY 20/03, POSSIBLE GLOBAL ALLIANCE WITH DELTA (DAL), AIR FRANCE (AFA), AEROMEXICO (AMX), AND AEROFLOT (ARO).
APRIL 2000: 14,107 EMPLOYEES (INCLUDING 1,431 FLIGHT CREW (FC), 2,905 CABIN ATTENDANTS (CA), & 4,793 MAINTENANCE TECHNICIANS (MT)).
747-230F (168-20373) SOLD TO BOEING (TBC). 747-273C (211-20652, HL7471) SOLD TO BOEING (TBC). SOLD 2 MD-11'S (48407; 48523) TO GECAS (GEH), AND LEASED BACK FOR 5 YEARS.
MAY 2000: 3 737-8B5'S (29981, HL-7560; 29982, HL-7561; 29983, HL-7562) DELIVERIES. 1 737-86N (562-28622, HL7557), (GEH) LEASED, & 1 747-4B5F (1246-26416, HL7448) DELIVERIES.
JUNE 2000: NEW GLOBAL ALLIANCE, DELTA AIRLINES (DAL) - AIR FRANCE (AFA) - KOREAN AIR (KAL) - AEROMEXICO (AMX), NAMED "SKYTEAM," TO MATCH ONEWORLD AND STAR ALLIANCES.
TO CAIRO - DUBAI (747, 2/WEEK).
SOLD 5 A300-600'S (PW4000) (358; 361; 365; 388; 417) TO INTREPID AVIATION (INL) AND LEASED BACK. +3 ORDERS (2/01) A330-300'S (PW4000). SOLD 2 747-400F'S (26411; 26416) TO GECAS (GEH) AND LEASED BACK. 1 737-86N (590-28625, HL7558), 1 747-4B5F (1248-26411, HL7449), & 1 777-3B5 (288-27952, HL7573) DELIVERIES.
JULY 2000: DAVID GREENBERG, CEO, EX-VP FLIGHT OPERATIONS, DELTA AIRLINES (DAL). GEORGE SNYDER, MANAGING VP SAFETY, EX-US AIR (USA).
1999 = +$226.37M (+$245.55M): 36.67B RPK (+13.6%); 73.1% LF; 5.96B FTK (+14.1%); 20.54M PAX (+4.2%); 14,500 EMPLOYEES.
KOREAN AIR (KAL) TO MOVE TO NEW INCHON INTERNATIONAL AIRPORT.
1999 WORLD TOP AIRLINES COMPARISONS:
TRAFFIC RPK (B): 16 TWA 41.9; 17 CAT 41.5; 18 ACN 39.19; TII 38.5; 20 ALI 36.7; 21 KAL 36.7; 22 IBE 35.4.
NET PROFIT ($M): 11 NWA 300; 12 CAT 282; 13 QAN 279; 14 USA 273; 15 KAL 226; 16 SAS 217; 17 AMW 201; 18 ASA 196.
FTK (FREIGHT TRAFFIC) (B): 1 FED 10.31; 2 LUB 7.07; 3 UPS 6.02; 4 KAL 5.96; 5 SIA 5.48; 6 AFA 4.73; 7 BAB 4.54; 8 JAL 4.42; 9 KLM 4.15; 10 CAT 3.77.
FARNBOROUGH AIRSHOW ANNOUNCEMENT OF 1 ORDER 747-400F (11/01). 2 A330-323X'S (350, HL7585; 351, HL7586), & 1 777-300 DELIVERIES.
AUGUST 2000: 1ST 6 MONTHS = -$176.6M: FUEL COSTS (+72.5%).
CHEJU - BEIJING.
1 737-86N (28626), GECAS (GEH) 8 YEAR LEASED. 737-8B5 (622-29981, HL7560) DELIVERY.
SEPTEMBER 2000: SKYTEAM CARGO, INCLUDING KOREAN AIR (KAL) CARGO, AIR FRANCE (AFA) CARGO, AEROMEXICO (AMX) CARGO, AND DELTA AIRLINES (DAL) AIR LOGISTICS, OPERATES 1,070 AIRPLANES, 6,810 DAILY FLIGHTS TO 411 DESTINATIONS (INCLUDING 12 MAJOR HUBS), IN 100 COUNTRIES.
RETURNED 2 A300-600'S (HL7521; HL7523) TO AIRBUS. 737-8B5 (29982) DELIVERY. MD-82 (49374) RETURNED TO (GEH), LEASED TO SPIRIT (SPR).
OCTOBER 2000: 1ST 6 MONTHS = 19.47B RPK (+17.8%); 10.72M PAX (+9.3%).
TOP WORLD AIRLINES 1ST 6 MONTHS - TRAFFIC RPK (B):
1 UAL 100.26; 2 AAL 92.41; 3 DAL 89.82; 4 NWA 62.13; 5 CAL 60.39; 6 USA 35.1; 7 SIA 33.79; 8 SWA 32.84; 9 KLM 28.94; 10 CAT 22.58; 11 TWA
21.26; 12 ACN 20.96; 13 KAL 19.47; 14 IBE 18.77; 15 AMW 15.0.
OPENS NEW CARGO FACILITY AT NEW YORK (JFK) CALLED "USA EAST COAST'S NEWEST, MOST SOPHISTICATED CARGO FACILITY" ENABLES DOUBLE CARGO CAPACITY TO >200K TONS/YEAR & WILL BE MAIN LOGISTICS CENTER FOR SKYTEAM ALLIANCE PARTNERS.
1N 1/01, CODE SHARE WITH AEROMEXICO (AMX), TO LOS ANGELES (LAX).
15,591 EMPLOYEES (INCLUDING 1,528 FC, 2,997 CA, & 3,454 MT) (+.6%).
$114M, 3 ORDERS (4/01) 737-800'S, CIT AERO (TCI) LEASED. 1 737-8B5 (678-29983, HL7562) AND 1 777-2B5ER (305-28444, HL7574) DELIVERIES.
NOVEMBER 2000: KOREAN AIR (KAL) SELECTED TO PROVIDE 747-400 CHARTER FLIGHTS FOR THE PRESIDENT OF KOREA TO SINGAPORE, JAKARTA, AND TO OSLO, & STOCKHOLM, TO ACCEPT THE NOBEL PRIZE.
2 ORDERS (2/02) 747-400F'S. 1 777-2B5ER (309-28445, HL7575) & 1 A330-323X (368, HL7587) DELIVERIES. LATTER SOLD TO SALE (SIL) & LEASED BACK.
DECEMBER 2000: 1ST 9 MONTHS = 30.99B RPK (+12.9%); 4.93B FTK (+15.7%); 16.49M PAX (+8.7%).
TOP WORLD AIRLINES - TRAFFIC RPK (B):
13 CAT 35.26; 14 TWA 33.56; 15 TII 31.25; 16 KAL 30.99; 17 IBE 30.21; 18 AMW 23.12; 19 VAA 22.08; 20 VAR 19.79.
1 A300B4-622R (477) TO FEDEX (FED). 1 A300B4-622R (554) SOLD TO QATAR (QTA).
JANUARY 2001: 5 A300-600'S (358; 361; 365; 388; 471) TO BE RETURNED TO INTREPID IN 2/02, FOR LEASE TO FEDEX (FED) & CONVERSION TO FREIGHTER. 1 737-8Q8 (756-28636, HL7563), (GEF) LEASED.
TOP WORLD AIRLINES 2000 - TRAFFIC RPM (B):
17 CAT 29.27; 18 TII 26.25; 19 ALI 25.24; 20 KAL 25.15; 21 IBE 24.87; 22 MAS 23.58; 23 SWS 21.28.
FEBRUARY 2001: NIGHT CHARTERS FROM CHEJU - TOKYO (HANEDA).
1 737-8Q8 (765-28638, HL7564), GECAS (GEF) LEASED.
MARCH 2001: INCHEON AIRPORT OPENS. ALL INTERNATIONAL FLIGHTS IN AND OUT OF SEOUL, TRANSFERRED TO THIS NEW AIRPORT FROM KIMPO. KOREAN AIR (KAL) OPENS NEW CARGO TERMINAL AT INCHEON AIRPORT.
MD-82 (JT8D-217A) (1278-49417, /86 26 35) RETURNED TO GECAS (GEF).
APRIL 2001: 14,107 EMPLOYEES (INCLUDING 1,431 FC, 2,905 CA, & 4,793 MT).
CHEJU - HONG KONG (MD-83, 3/WEEK).
2 MD-82'S (1394; 1403) RETURNED TO (GEF). 747-300F (RS292) FREIGHTER CONVERSION COMPLETED. 1 MD-82 (1394-49418), RETURNED TO (GEF).
MAY 2001: APPLYING FOR (ETOPS) APPROVAL FOR 737-800, FOR ROUTE TO GUAM. 2 737-800'S DELIVERIES.
JUNE 2001: 1 737-86N (878-28647, HL7567) DELIVERY.
JULY 2001: SOUTH KOREA IS LIKELY TO BE DOWNGRADED BY (FAA) SAFETY OVERSIGHT TO CATEGORY 2, FOLLOWING A RECENT AUDIT.
ALITALIA (ALI) BECOMES 6TH MEMBER OF SKYTEAM ALLIANCE: KOREAN AIR (KAL); AIR FRANCE (AFA); DELTA AIRLINES (DAL); AEROMEXICO (AMX); & CZECH AIRLINES (CSA).
737-8B5 (891-29986, HL7568) DELIVERY.
AUGUST 2001: SUMMER CHARTER FLIGHTS TO BEIJING, TIANJIN, QINGDAO, SHENYANG AND FROM PUSAN TO SHANGHAI.
SEPTEMBER 2001: BUSAN (PREVIOUSLY KNOWN AS PUSAN) TO QINGDAO, CHINA (737-800, 3/WEEK).
1ST 6 MONTHS = -$270M. WILL LAY OFF -500 INCLUDING EARLY RETIREMENTS.
1 747-4B5, 1 747-4B5F & 1 777 DELIVERIES. 1 MD-82 (2102-53467) RETURNED TO BOEING.
OCTOBER 2001: IN 12/01, TO WUHAN (MD-82, 2/WEEK), TO KUNMING (737, 2/WEEK). TO HANOI (737-800, 3/WEEK). STARTS SERVICE TO AKITA, JAPAN (3/WEEK).
TOP WORLD AIRLINES 1ST 9 MONTHS - TRAFFIC RPK (B):
15 CAT 34.34; 16 MAS 27.98; 17 ALI 27.92; 18 KAL 27.24; 19 AMW 24.20; 20 VAR 19.81; 21 CHI 19.70; 22 SAS 18.17; 23 EAD 17.59.
2 A330-323X'S (425, HL7701; 428, HL7702) DELIVERIES.
NOVEMBER 2001: 1ST 737-9B5 DELIVERY IN ASIA (965-28655, HL7704).
INCREASES ITS LAYOFFS TO -1,000, OF TOTAL 17,000.
DECEMBER 2001: (FAA) SAFETY OVERSIGHT, RESTORES CATEGORY 1, FOR KOREA, AND LIFTS ALL RESTRICTIONS ON ITS CARRIERS.
ANNOUNCES 11 ORDERS FOR AIRPLANES IN /02: 5 ORDERS 737-900'S; 2 ORDERS 747-400F'S; 2 ORDERS 777-200'S; AND 2 AIRBUS A3XX-XXX'S?
747-4B5F (1291-27073, HL7467) DELIVERY. 3 A300-600'S (477; 479; 543), SOLD TO INTREPID AVIATION, FOR FEDEX (FED). 1 737-9B5 (1026-29988, HL7599) DELIVERY.
JANUARY 2002: JOINT CARGO VENTURE WITH AIR FRANCE (AFA) AND DELTA AIRLINES (DAL), OPENS NEW 11,000 SQ FT, OFFICE, AT ATLANTA HARTSFIELD AIRPORT, WITH STAFF OF 56, AND CEO, BERNARD FRATTINI, AND REGIONAL OFFICES IN NEW YORK, CHICAGO (ORD), AND LOS ANGELES (LAX).
SERVICE TO CAIRO. INCHEON - HANOI (737, 2/WEEK) AND INCHEON - SAIPAN (A330-300, DAILY). PUSAN - BANGKOK (CHARTER FLIGHTS, 4/WEEK).
2001 = 37.95B RPK (-5.7%); 21.62M PAX (-2%).
2001 TOP 50 WORLD AIRLINES - TRAFFIC B RPM:
1 UAL 116.60; 2 AAL 106.15; 3 DAL 97.60; 4 NWA 73.11; 5 BAB 64.24; 6 AFA 59.54; 7 CAL 58.76; 8 DLH 56.76; 9 JAL 50.77; 10 USA 45.93; 11 SWA 44.50; 12 SIA 42.76; 13 QAN 42.14; 14 ACN 41.49; 15 KLM 35.76; 16 ANA 33.16; 17 CAT 27.81; 18 TII 27.43; 19 IBE 25.64; 20 KAL 23.73; 21 ALI 22.45; 22 MAS 22.29; 23 AMW 19.06; 24 VAA 17.65; 25 VAR 16.02; 26 CHI 16.00; 27 EAD 14.37; 28 SAS 14.26; 29 ANZ 13.54; 30 SAA 12.70; 31 SVA 12.56; 32 BEJ 12.39; 33 ASA 12.23; 34 JAS 10.06; 35 THY 9.35; 36 AMX 8.51; 37 PAL 8.36; 38 GIA 8.15; 39 CMA 7.99; 40 ELA 7.79; 41 GUL 7.65; 42 PIA 7.24; 43 AIN 7.10; 44 TAP 6.43; 45 EGP 5.53; 46 OLY 5.24; 47 AUL 5.06; 48 FIN 4.93; 49 IND 4.52; 50 CQT 4.51.
MARCH 2002: (TELEPHONE: (2) 656 71 14). (FAX: (2) 775 29 36).
APRIL 2002: 16,000 EMPLOYEES.
MAIN BASE: SEOUL - GIMPO INTERNATIONAL (SEL).
HUBS: PUSAN - KIMHAE INTERNATIONAL (PUS); & CHEJU INTERNATIONAL (CJU).
MAY 2002: 1ST Q = +#29.1B YUEN (-#230.8B YUEN).
To Jinan, China (3/week). Taegu to Yantai, China (2/week), Seoul (ICN) to Xiamen (3/week), Seoul (Kimpo) to Gunsan.
June 2002: 2001 Top World Airlines by Traffic (RPK B):
1 UAL 187.67; 2 AAL 170.88; 3 DAL 163.66; 4 NWA 117.66; 5 BAB 106.27; 6 CAL 98.37; 7 AFA 94.42; 8 DLH 86.70; 9 JAL 84.27; 10 USA 73.93; 11 SWA 71.59; 12 SIA 69.15; 13 QAN 67.89; 14 ACN 67.03; 15 KLM 57.85; 16 ANA 56.90; 17 CAT 44.79; 18 TII 44.04; 19 IBE 41.30; 20 KAL 38.45; 21 MAS 38.31; 22 ALI 36.52; 23 SWS 32.98; 24 TWA 31.85; 25 AMW 30.69.
2001 Top World Cargo Operators B FTK:
1 FED 11.05; 2 LUB 7.08; 3 UPS 5.96; 4 SIA 5.88; 5 KAL 5.57; 6 AFA 5.12; 7 KLM 4.64; 8 JAL 4.19; 9 BAB 4.033; 10 CHI 4.030; 11 NCA 3.93; 12 CAT 3.89; 13 CLX 3.77; 14 EVA 3.28; 15 UAL 2.80; 16 NWA 2.79; 17 AAL 2.56; 18 MTH 2.40; 19 AAR 2.38; 20 DAL 2.31; 21 MAS 1.84; 22 SWS 1.79; 23 TII 1.67; 24 QAN 1.57; 25 AHK 1.55.
KOREAN AIR (KAL) 2001: -$445M (-$349M): 38.45B RPK (-5.3%); 68.9% LF; 21.64B PAX (-1.9%); 5.57B FTK (-15.5%); 16,000 EMPLOYEES (-.2%).
737-9B5 (1162-29990, HL7705) delivery.
July 2002: Delta Airlines (DAL) will be allowed to expand its marketing agreement with Korean Air (KAL), to develop a network-to-network flight system, on transpacific routes, as a result of a USA Transportation Department (DOT) decision, to grant them antitrust immunity.
August 2002: In 10/02, code share with Vietnam (VIE), Seoul (ICN) - Hanoi.
1st 6 months = +# 195.4B WON/+$161.9M (-# 345.9B WON): +4% RPK; +2.5% ASK; 71% LF (+.8); +13.6% FTK; improvement due to steady growth in its passenger and cargo business, continuous restructuring in all business sectors, stabilized jet fuel prices, better interest rates, and strengthening of the won against the dollar ($).
5th & 6th 737-9B5 (1188-29991, HL7706; 29992, HL-7707) deliveries. A300B4-600 (361, N717FD), sold to Intrepid (INL). A300B4-622R (614) sold to Qatar (QTA). 14th A330-323X (484, HL7709) delivery.
September 2002: With Asian Games in Busan, Korea, this month, launches daily flights from Busan to Bangkok, and Hong Kong. Will use those cities as hubs, for increasing demand.
777-2B5ER (416-28372, HL7715), delivery. +1 order (9/03) 777-200ER (PW4000).
October 2002: 1 737-9B5 (1208-29993, HL7708); 1 747-4B5F (1316-32809, HL7434); & 1 A330-323X (490, HL7710) deliveries. 2 MD-83's (2116-53469; 2132-53487), traded in to Boeing.
1st 6 months Top World Airlines Traffic B RPK:
1 AAL 95.18; 2 UAL 84.56; 3 DAL 74.53; 4 NWA 56.50; 5 BAB 49.30; 6 AFA 48.21; 7 CAL 47.49; 8 DLH 42.06; 9 JAL 39.44; 10 SWA 36.03; 11 SIA 36.00; 12 ACN 33.69; 13 USA 33.06; 14 KLM 27.54; 15 CAT 23.07; 16 IBE 19.53; 17 KAL 16.47; 18 CHI 15.70; 19 AMW 15.20; 20 ALI 14.21; 21 EAD 13.45; 22 VAR 12.68; 23 GUN 12.49; 24 SAS 12.01; 25 BEJ 10.32.
November 2002: Flight Safety Foundation (FSF) gives award to Shim Yi-Taek for "Best business executive in aviation safety," for "leading Korean Air (KAL) in heavy investments in improved pilot management systems, flight operations, and information technology (IT), for enhanced safety."
3rd Q = +# 86.5B WON/+$70.7M (-# 103B WON). 1st 9 months = 31.34B RPK (-18.5%); 16.57M PAX (-23.4%); 4.56B FTK (-18.2%).
Korean Air (KAL) founder and Chairman, Choong Hoon Cho, died at the age of 82. Cho launched (KAL)'s parent, Hanjin Transportation at the age of 25, with one truck as its sole asset. Today, Hanjin Group, has 21 subsidiaries, 35,000 employees, and total revenues of # 15 trillion won ($12.5B).
1st 9 months Top World Airlines Traffic RPK B:
1 AAL 148.39; 2 UAL 132.89; 3 DAL 123.75; 4 NWA 88.26; 5 BAB 76.23; 6 AFA 74.00; 7 CAL 73.12; 8 DLH 67.07; 9 SIA 55.60; 10 SWA 55.20; 11 JAL 54.81; 12 ACN 54.41; 13 USA 50.38; 14 KLM 48.87; 15 QAN 43.76; 16 CAT 36.14; 17 IBE 30.78; 18 KAL 28.06; 19 AMW 23.82; 20 TII 19.76; 21 ALI 19.68; 22 SAS 18.82; 23 CHI 18.23; 24 VAR 17.47; 25 GUN 17.21.
747-4B5(24199, HL7409) 3 year lease to Air India (AIN). 2 MD-82's (2114-53468; 2132-53487) returned to Boeing.
December 2002: Seoul (ICN) - Taipei (charters, 3/week).
1 747-200F Atlas (TLS) wet-leased in 1/03. 3 orders (5/03) 747-400ERF (PW4000).
The following incident occurred on a Philippine Airlines (PAL) A330, which bears close similarities to the Korean Air (KAL) crash at Guam in 8/97:
INCDT: Philippine Airlines (PAL) A330-301, came "incredibly close" to hitting a hillside, when it scraped power line wires on a 35 foot-tall utility pole on Nimitz Hill as airplane tried a go-around in response to a Ground Proximity Warning System (GPWS) alert, on approach to Agana Airport, Guam, thus saving the airplane and those on board from the fate that befell Korean Air (KAL) 747-300 in 8/97 (228 fatalities of 245 on board). The (PAL) three-man flight crew have had their licenses suspended and cannot fly again until the final results of the investigation. (PAL) may also face penalties for failing to report the incident to Philippine regulatory authorities within 72 hours as required by law.
Flight crews flying into Agana Airport, Guam, have been alerted again to the fact that this approach can be highly dangerous. It is fortunate that this time, no-one died, but it is also remarkable that an industry has such an incredibly short memory for safety issues - even specific, serious ones - and appears not to be able to profit from experience. Both in 1997, and in this one, the airport navigation aids were only partially serviceable, but both flights left for Guam in the full knowledge that this was the situation. Philippine Airlines (PAL) claims its A330 made the approach with "bare-minimum navigational aids" as a result of damage to infrastructure caused by a recent typhoon (including disabled runway approach lighting system, middle marker, glideslope, sequenced flashing lights, and missing the VORTAC (navigation beacon) on Nimitz Hill).
There is no industry system for persuading airlines to take each other's accidents seriously enough. The International Civil Aviation Organization (ICAO) is supposed to be the repository for all reports but often is not even sent copies. (ICAO) has been promoting the idea of a Global Aviation Information Network (GAIN), but this has been going nowhere for a long time. About 120 airlines have acquired the British Airways Safety Information System (BASIS), but this system for spotting incident trends, is a series of in-house units. The International Air Transport Association (IATA) has pledged to use the (BASIS) model to build up something wider, but today, things give the impression that other current financial needs have swayed this important issue, well down the priority list. The Flight Safety Foundation tries to enable airlines to learn from others' experiences by summarising significant major reports in digest form, and disseminating them to members.
In a worldwide industry, there needs to be a global culture for things like safety, that the whole industry should hold in common. At present, however, global safety cohesion is missing, and no single organization has been charged with creating the awareness that is essential.
January 2003: Cheongju - Shanghai (3/week). Busan - Xi'an (2/week).
February 2003: Seoul (Incheon) - Daegu (F 100, daily).
2002 = +# KRW 111.9B/+$95M (-# KRW 589.4B): >70% LF; 6.2B FTK (+12%).
Cho Yang-ho, son of the late Cho Choong-hoon - the founder of the parent Hanjin Group, who died in 11/02 - has taken control of the group.
747-4B5F (1323-32808, HL7437) delivery.
March 2003: Citing load factors averaging nearly 80% LF, has extended its charter flights Seoul (Incheon) - Taipei until end 5/03, and increased frequencies from 5 to 7. Also, has increased capacity by replacing 737's with A330-200's.
Has launched inflight DVD service on flights Seoul (Incheon) - London and Sydney. In 4/03, service will be expanded to Washington, Rome, New Zealand, and Los Angeles.
April 2003: 15,127 employees.
World Top 20 Airlines 1st Q Traffic (B) (RPK):
1 (AAL) 44.67; 2 (UAL) 39.66; 3 (DAL) 36.82; 4 (NWA) 26.65; 5 (BAB) 23.31; 6 (AFA) 23.27; 7 (CAL) 21.35; 8 (DLH) 20.62; 9 (SWA) 17.53; 10 (KLM) 14.04; 11 (USA) 13.28; 12 (SIA) 12.20*; 13 (ACN) 9.65*; 14 (CAT) 8.51*; 15 (AMW) 7.84; 16 (QAN)* 7.18; 17 (KAL)* 6.72; 18 (IBE) 6.17*; 19 (EAD) 5.69*; 20 (AAT) 5.42. * 2 mths only.
May 2003: 1st Q = -# KRW 180B/-$143M (+# KRW 29.1B/+$22M).
June 2003: Korean Air (KAL) and SkyTeam partners: Delta Airlines (DAL), Czech Airlines (CSA), AeroMexico (AMX), & Air France (AFA) are leasing facilities from airports operator ADP in the new purpose-built # EUR750M/$892M Terminal 2E at Paris Charles de Gaulle (CDG). Alitalia (ALI) operations will remain for now in nearby 2F. Terminal 2E, basically consisting of a main concourse 450 m long and a boarding pier 650 m long, ultimately will have a handling capacity of 17 on-stand parking gates and up to 10M passengers/year, with 6M passengers/year in the initial phase.
2002 = +$90.4M (-$458M): 41.80B RPK (+8.7%); +4.1% ASK; 70.7% LF (+1.8); 22.2M PAX (+2.5%); 6.25B FTK (+12.1%); 15,304 EMPLOYEES (+1.2%).
2002 TOP 25 WORLD AIRLINES - TRAFFIC - B - RPK
1 (AAL) 195.81; 2 (UAL) 176.15; 3 (DAL) 152.66; 4 (NWA) 115.91; 5 (BAB) 99.71; 6 (AFA) 96.80; 7 (CAL) 95.51; 8 (DLH) Grp 88.57; 9 (JAL) 83.54; 10 (QAN) 75.23; 11 (SWA) 73.05; 12 (SIA) 71.12; 13 (ACN) 69.42; 14 (USA) 69.42; 15 (KLM) 58.89; 16 (ANA) 52.97; 17 (CAT) 49.04; 18 (TII) 48.51; 19 (KAL) 41.80; 20 (IBE) 40.47; 21 (MAS) 36.90; 22 (AMW) 31.98; 23 (SAS) Grp 30.91; 24 (EAD) 30.17; 25 (ALI) 29.84.
2002 TOP 25 WORLD FREIGHT CARRIERS - B - FTK
1 (FED) 13.20; 2 (LUB) 7.16; 3 (UPS) 6.62; 4 (KAL) 6.25; 5 (SIA) 6.08; 6 (AFA) 4.87; 7 (CAT) 4.85; 8 (CHI) 4.60; 9 (JAL) 4.39; 10 (CLX) 4.16; 11 (BAB) 4.12; 12 (KLM) 3.99; 13 (EVA) 3.28; 14 (NWA) 3.24; 15 (AAL) 2.93; 16 (UAL) 2.79; 17 (AAR) 2.75; 18 (NCA) 2.21; 19 (POA) 1.97; 20 (EAD) 1.96; 21 (MAS) 1.92; 22 (BEJ) 1.88; 23 (TII) 1.824; 24 (DAL) 1.823; 25 (ACN) 1.58.
1st of 3 747-400ERF (33616, HL7438) deliveries. Paris Air Show, $1.5 Million, 2 orders 747-400ERF's and 7 orders 777's. Also 5/3 orders (11/07) A380's.
July 2003: Received (JAA) approval to provide maintenance to European carriers. Already has (FAA) approvals and supports more than 30 carrriers serving Seoul. Estimates the ability to provide (MRO) services to European carriers will bring in +$22.5M in revenue in 2003.
2002 = +$93.22M (-$444.45M): 41.80B RPK (+8.7%); 70.7% LF; 22.17M PAX (+2.5%); 6.25B FTK (+12.1%).
737-9B5 (29995, HL7717) delivery.
August 2003: 2nd Quarter = +104.6 Billion Won/+$88.71 Million (+ 166.3 Billion Won): -8.9% RPK; +3.9% FTK. 1st 6 months = -284.57 Billion Won (+485.61 Billion Won).
September 2003: Takes over Daewoo Industries' stake in Korea Aerospace Industries (KAI), to make it the largest owner of the company, which is the only maker of airplane parts and assemblies in South Korea, assuming similar agreements with (KAI) co-owners the Hyundai and Samsung groups are consumated. Each company owns arpound 28% and a further 15% is owned by a group of creditors. Korean Air (KAL) has had its own airplane parts manufacturing division since 1986. Acquisition cost of (KAI) is in the range of $85-$108M.
(KAL) with a fleet of 119 airplanes operates almost 400 passenger flights/day to 84 cities in 29 countries, and is a founding member of SkyTeam.
8 charter flights, Seoul to Pyongyang.
777-2B5ER (33727, HL7721) delivery. F 100 (11378, HL7206) sold to Iran Aseman (IRB). A300B4-622 (388) sold to Intrepid (INL).
October 2003: Code share with Air Canada (ACN), Seoul - Vancouver, & beyond to Toronto, Montreal, and New York.
Is in the final stages of implementing an Internet-based integrated cargo system that will encompass space/resource control, pricing, traffic and auditing functions, investing $20M in this project.
+2 747-400ERF's for total 5, 1 delivered. A330-323X (550, HL7720) delivery. F 100 (11388, HL7208; 11432, 9) sold to Iran Aseman (IRB).
November 2003: Japanese Ministry of Land, Infrastructure & Transport permits daily charter service between the capitals Tokyo (Haneda) and Seoul (Kimpo), by 4 airlines: (JAL) Group & All Nippon (ANA) from Japan, and Korean Air (KAL) & Asiana (AAR) from Korea.
10-year, $120 Million outsourcing contract to (IBM) to shift the airline's international Information Technology (IT) networks to newer Internet-based technologies to increase efficiency and improve customer service. Also a 10-year, $90 Million contract to outsource the networking of its domestic Korean offices with Hanjin Information System Technology. Will serve >90 Korean Air (KAL) offices worldwide, allowing it to deploy new applications more quickly throughout its worldwide system. Hanjin will develop a network that serves >35 offices throughout Korea and will interface with the (IBM) network.
December 2003: In 2004, to Helsinki.
Plans to convert up to 7 747-400's to freighters beginnning in 2005 and to replace MD-11F's and 747-200F's. $1.5 Billion, 9 orders (6/05) 777-200ER's (PW4090) for total 22.
747-4B5 (24621, HL7481) wet-leased to Air-India (AIN).
January 2004: 4th Quarter = -183.5 Billion Won/-$153.6 Million (- 87.2 Billion Won/-$72.9 Million). 2003 = -241.1 Billion Won/-$206.7 Million (-153%) (+453.8 Billion Won).
Unveils its long-term strategy in which it aims to become the world's leading cargo carrier by 2007 and one of the world's top 10 passenger airlines by 2010. Will involve >$9 Billion in long-term investment to grow into "a vibrant, spirited organization." Will spend $137 Million in "service-oriented investments" retaining Landor to redesign its airplane interiors in a project to be completed by 2006, including first class (F) "cocoon" seats & premiun business class (C) seats as well as audio/video on demand & Internet services for all classes. $6.6 Billion over next 10 years for airplane fleet acquisitions & modernizations. $430 Million for projects at Incheon International Airport, including its first (F) & business class (C) lounges and the Hyatt Regency Incheon, as well as cargo & catering facilities. Also, it plans to invest $1.9 Billion over next 10 years in new Information Technology (IT) programs.
February 2004: In May, Seoul (Incheon) - Prague (A330, 3/week). Seoul - Warsaw (A330-200, 3/week).
Lee Joong-hee, President & (COO) replaces Shim Yi-taek, now Vice-Chairman. Y H Kim, Executive VP & President Passenger Business Division. Ken Choi, President Cargo Business Division. W Y Lee, President Hanjin Corporation.
March 2004: Expands its cargo terminal at Incheon with a $6.3 Million follow-up Information Technology (IT) order, contracted with Siemens Dematic. The existing terminal will be expanded by a 4th module that will be equipped with the automated Cargo Compact Plus control system, Siemens Dematic's latest version of its air cargo material flow-control solution. The new subsystem is scheduled to go into operation at end of 2004. Korean Air (KAL) also plans to upgrade its 3 existing cargo modules from semiautomatic to fully automatic ops with the Siemens system.
Cargo service, Seoul (ICN) to New York (JFK) to Oslo to Seoul (747-400F, weekly).
747-2B5F (22486, HL7459) sold to Boeing (TBC).
April 2004: Selects Boeing Connexion to provide onboard Internet service for its long-haul fleet, with installation in 747-400's & 777ER's in early 2005.
May 2004: Code share with (CSA) Czech Airlines, Prague to Seoul (A330, 3x-weekly).
737-9B5 (29998, HL7724) & 747-4B5FER (33945, HL7600) deliveries.
June 2004: Seoul (Incheon) to Shanghai (Pudong) (777-300/A330-300, daily). Code share with China Southern (GUN), Seoul Incheon to Shenyang (10x-weekly). Next month, Seoul to St Petersburg (3x-weekly). In August, code share with Japan Airlines Group (JAL), from regional cities in Japan to Seoul, including Komatsu to Seoul (4x-weekly), Sapporo to Seoul (daily), & Niigata to Seoul (5x-weekly).
United Airlines (UAL)'s United Services and (KAL) reached a reciprocal Maintenance Repair & Overhaul (MRO) agreement, wherby the 2 will work cooperatively to identify product lines where they can use their technology and expertise to "serve each other's (MRO) needs." United Services currently provides (MRO) service for (KAL)'s (PW4090) engines and (KAL) will send +3 additional engines for repair over the next 12 months. During the same period, (UAL) will use (KAL) for some overflow work, previously scheduled for an outside vendor, on its (PW4056)'s.
SkyTeam: Aeroflot (ARO) (applicant); Aeromexico (AMX); Air France (AFA)/(KLM); Alitalia (ALI); (CSA) Czech Airlines; Continental Airlines (CAL) (agreed to join); (KAL); & Northwest Airlines (NWA) (agreed to join).
+2 orders (2005-06) 747-400ERF's (PW4056). 20 orders 747-400SF Special Freighter conversion kits, including 10 for existing (KAL) passenger 747-400 airplanes and acquisition of +10 used 747-400's for the remaining kit conversions.
737-9B5 (29999, HL7725), delivery.
July 2004: Selected Rockwell Collins to provide avionics for 9/1 new 777's including MultiScan Radar and GLU-920 Multi-Mode Receiver.
Seoul Incheon to St Petersburg (A330-200, 3/week).
August 2004: Seoul (ICN) to Penang (3x-weekly). Korean Air (KAL) Cargo, Calgary to Seoul (747-400F, weekly).
737-9B5 (30000, HL7727) delivery. 100th Boeing airplane delivery, a 747-400ERF (33946, HL7601).
September 2004: (ARINC)'s Asia/Pacific division was awarded contracts to Korean Air (KAL), Japan Airlines (JAL), Asiana Airlines (AAR), and All Nippon Airways (ANA) with (ARINC)'s iMuse common-use passenger technology at Korea's Kimpo International Airport.
All 4 USA airlines that fly 777's over the North Pacific ocean: American (AAL), Continental (CAL), Delta (DAL), & United (UAL), plus All Nippon (ANA), Singapore (SIA), & Korean (KAL) are flying 207-minute (ETOPS). Boeing twin-engine airplanes have dominated flights over the North Atlantic ocean and are now expected to dominate the Pacific. With the current trend of 390 Pacific (ETOPS) flights/day and rising, Pacific (ETOPS) flights will soon outnumber those over the Atlantic ocean.
Northwest Airlines (NWA), (KLM), & Continental Airlines (CAL) became the newest members of the SkyTeam (STM) Alliance to join Aeromexico (AMX), Air France (AFA), Alitalia (ALI), (CSA) Czech Airlines, Delta (DAL), & Korean Air (KAL).
>$25 Million contract for B/E Aerospace's MiniPod lie-flat business class (C) seat product line for its 747's & 777's to be delivered in 2005.
$500 Million for 31 (PW4000) engines to power new 2 orders (2/05) 747-400ERF's and 9 orders (2/05) 777-200ER's.
October 2004: Seoul (ICN) to Denpasar (Bali) and Phuket (A330, 2/week). Pusan to Phuket (2x-weekly). To expand its code share operations with Malyasia Airlines (MAS) into a "free sale dynamic code share" that will cover 2 additional routes: Seoul to Kota Kinabalu & Seoul to Penang.
F 100 (11522), sold to Iram Aseman (IRB).
November 2004: (MOU) with (LAN) Airlines (LAN) for increased cooperation, including code sharing, and frequent flier tie-ins that will start in March. Seoul to Los Angeles, and Los Angeles to Lima, Santiago.
December 2004: Resumes flights to Taiwan after a 12-year break (daily).
January 2005: To expand its code share agreement with Japan Airlines (JAL), with Nagoya Chubu International Airport to Pusan (777, 2x-daily) in May, increasing code share flights to 64 on 2 routes.
Completed its (IATA) Operational Safety Audit to become an official (IOSA)-registered carrier.
737-9B5 (30002, HL7728) delivery. F 100 (11523) sold to Iran Aseman (IRB).
February 2005: Cargo code sharing with Northwest Airlines (NWA)) under which (NWA) will place its NW code on Korean Air (KAL) cargo flights, Seoul to Anchorage, Atlanta, Chicago, Dallas/Fort Worth & San Francisco. (KAL) in turn is marketing its (KE) code on (NWA)-operated freighters from Anchorage to Chicago & Cincinnati, as well as between Seoul and Anchorage.
March 2005: 737-9B5 wet-leased to Okay Airways (OKA).
April 2005: $2.6 Billion, 10/10 orders (2009-02) 787-8's, 223 PAX.
Yang Ho Cho Chairman & (CEO) stated "The order signifies our commitment to our vision of becoming 1 of the world's top 10 airlines by 2010. During the next decade, Korean Air (KAL) will invest $10 Billion in new airplanes, in-flight service upgrades and Information Technology (IT) enhancements.
May 2005: 15,352 employees (including 1,674 Flight Crew (FC); 3,862 Cabin Attendants (CA); & 5,424 Maintenance Technicians (MT)).
June 2005: 737-9B5 (30001, HL7726) & 777-2B5ER (34206, HL7733), deliveries. 2 747-2B5F's (24195; 24196) & 1 747-3B5F (24194) leased to Cargo 360 Inc.
July 2005: United Airlines (UAL) $12 Million/year, 5-year heavy maintenance contract to Korean Air (KAL) for "C" & "D" checks in addition to parts overhaul services for (UAL)'s 27 747-400's to be carried out starting this month at (KAL)'s Gimhae Plant, Busan.
777-2B5ER (34207, HL7734), delivery.
August 2005: 14,499 employees (-2.3%).
May take a stake in Okay Airways (OKA). Maximum allowable is 49% and 25% from any other one foreign investor.
October 2005: Emirates SkyCargo (EAD) and Korean Air Cargo (KAL) agreed to share cargo capacity on (KAL) flights to Delhi and Mumbai. Emirates SkyCargo (EAD) now has an additional 22 tons on offer to Dubai on (KAL)'s 747-400F weekly services from Delhi (Fridays) and Mumbai (Wednesdays).
Korean Air (KAL) added Mudanjiang to its network, offering a weekly roundtrip. Mudanjiang is Korean (KAL)'s 18th destination in China. Korean Air (KAL) is considering 2X weekly flights to the Thai resort island of Phuket after a 10-month hiatus following the tsunami. (KAL) will begin a temporary service linking Seoul to Hwang Shan, a mountainous resort in the Chinese province of Anhui. KAL) will operate 2x-weekly, on Friday & Sunday with a 737-800 for a total of 6 flights until the end of the month. (KAL) will look at passenger demand and decide whether to continue service on a regular basis.
Korean Air Aerospace Division will provide the raked wingtips for the 787, Boeing said yesterday. Selection was valued at $200 million over the life of the program.
747-4B5ERF (34301, HL7602), delivery.
November 2005: Emirates (EAD) and Korean Air (KAL) signed a code share agreement for service between Dubai and Seoul affecting 10x-weekly between the cities. Emirates (EAD) launched daily nonstop service to Seoul in May.
(KAL)'s 3rd-quarter profit rose +80.6% to +KRW154.2 billion/+$148.1 million compared to +KRW85.4 billion in the year-ago period.
Growth was driven partly by fuel surcharges that lifted domestic and international yield +15% and +17% respectively. "Despite increasing fuel costs, we were able to contain our overall operating expenses. In fact, we saw lower rent, labor and maintenance costs and were therefore able to report an improved profit margin," President Jonghee Lee said.
In the 1st 9 months, (KAL) earned KRW171 billion, a drop of -37.7% from the year-ago period. Operating profit rose +7.1% from KRW379.8 billion to KRW406.7 billion.
December 2005: (ARINC) said that Korean Air (KAL) chose its Graphic/Text Weather Service (G/TWS). (KAL) began receiving (G/TWS) service last month.
(KAL) cancelled 253 of 399 scheduled flights as the strike by its pilot unions continued into a 2nd day. (KAL) canceled 204 of 387 scheduled flights previously. The latest cancellations included 54 of 157 international flights, 176 of 212 domestic flights and 23 of 30 cargo flights. The South Korean government warned it will consider invoking emergency powers to order the pilots (FC) back to work but has not released a deadline after which it will act. (KAL) never has had a strike that lasted >2 days.
Later, the South Korean government ordered striking (KAL) pilots (FC) back to work Sunday, ending a strike that began Thursday and resulted in the cancellation of >1,100 passenger and cargo flights over the 4 day period. (KAL) and the pilots, represented by the Flight Crew Union (FCU), now will negotiate an agreement with the help of a mediator. If they are unable to arrive at an accord, the government may arbitrate a settlement. (FCU) originally asked for a +6.5% increase in basic wages and flight pay while the company offered +2.5%. The union subsequently reduced its request to +4.5% and then to +3.5% while the airline held firm at +2.5%. The walkout resulted in -$183.1 million in losses for (KAL), largely from cargo, according to "Reuters."
American Airlines (AAL) started interline e-ticketing with (KAL) and Turkish Airlines (THY).
(KAL) said that it signed a $300 million deal with Boeing to supply nose wheels for the 787, according to Reuters. (KAL) placed an order for up to 20 787 Dreamliners in April and earlier agreed to supply wingtips for the airplane.
(KAL) selected the (GEnx) to power the 20 787s it ordered earlier this year. The deal is worth >$240 million, according to (GE), which will deliver the engines beginning in 2009.
January 2006: Connexion by Boeing signed a 3-year deal with Korean Air (KAL) making it the 1st authorized modification center for retrofit installation of the Connexion product. (KAL) intends to retrofit 3rd-party airplanes. By mid-2007, all of its own mid/long-range airplanes will be equipped with Connexion.
(KAL) concluded a challenging Fiscal Year (FY) 2005 with net earnings of +KRW202.3 billion/+$205.6 million, a -61.1% plunge from its 2004 profit of +KRW519.5 billion. Chairman & (CEO) Yang-Ho Cho acknowledged last year's difficulties, saying, "High fuel prices throughout the year combined with the pilots strike in December caused a decrease in (KAL)'s net profit. However, our efforts to enhance profitability through cost savings and fuel surcharges brought about an increase in (KAL)'s overall operating profit." Indeed, operating profit rose +12.6% to +KRW432.2 billion on a +5.2% gain in revenues to KRW7.58 trillion and a +4.8% climb in expenses to KRW7.15 trillion.
(KAL) attributed improved revenues to "solid growth in international passenger traffic," although it said its cargo business suffered "from setbacks in the global Information Technology (IT) industry." In addition, a 4-day pilots strike last month in cancellation of >1,100 flights and reported losses of approximately -$183.1 million.
Based on calculations using 3rd-quarter results, (KAL) posted a 4th-quarter net profit of +KRW31.3 billion and an operating profit of +KRW25.5 billion.
747-4B5ERF (34302, HL7603), delivery.
February 2006: Korean Air (KAL) Cargo launched weekly cargo flights to Chennai February 16 using a 747-400F. Flights become semi-weekly in May.
March 2006: Korean Air (KAL) and AeroMexico (AMX) announced a code share agreement effective March 1 allowing (KAL) passengers arriving in Los Angeles (LAX) to connect to (AMX) flights to Mexico City and Guadalajara. (AMX) passengers will be able to connect through (LAX) to (KAL)'s Seoul service. The airlines already share loyalty program reciprocity through the SkyTeam (STM) Alliance.
Japan Airlines (JAL) and (KAL) are expanding their code share operations between the countries beginning March 26 when the number of routes and services will jump from 7 routes and 104x-weekly to 9 routes and 266x-weekly flights. On a one-way basis, the 2 airlines will code share on an additional 84x-weekly on the Tokyo Narita to Seoul route, 56x- on the Kansai to Seoul route and 28x- on the Nagoya Chubu to Seoul route.
(KAL) is boosting summer services and upgrading airplanes used on the Seoul to New York (JFK) route. Weekly flights to Seattle will increase from 3x- to 4x-, and weekly frequencies to Toronto will rise from 2x- to 3x-. Other increases are Paris (CDG), from 5x-weekly flights to daily, Amsterdam and Zurich to 3x-weekly, and Moscow to 4x-weekly. From August 1, Korean (KAL) will introduce 777-200ERs with cocoon-styled sleeper seats on the (JFK) route. The 777s also feature (AVOD) in all 3 classes, in-flight Internet and revamped interiors.
May 2006: Korean Air (KAL) credited rising passenger and cargo demand and a strong won for an impressive 1st quarter during which it more than doubled its net profit to +KRW127 billion/+$134 million from the +KRW59 billion earned in the quarter ended March 31, 2005.
"The operating environment in the 1st quarter of 2006 was not without challenges," President Jong-Hee Lee said. "Fuel costs remained at a high level, yet we were able to offset these and keep the increase in operating expenses at a reasonable level by lowering maintenance and rental expenses."
Operating revenue climbed +7.8% to KRW1.84 trillion as passenger traffic and yields grew across all segments. Expenses increased +6.2% to KRW1.74 trillion and operating income rose +49.3% to +KRW91 billion. Domestic passenger traffic was up +6.6% to 864 million (RPK)s against a -1.6% drop in capacity to 1.4 billion (ASK)s, raising load factor +4.7 points to 61.8% LF. Domestic yields increased +2.8% to 16.2 cents. International traffic climbed +7.3% to 11.08 billion (RPK)s as capacity grew +7.6% to 16.01 billion (ASK)s and load factor dipped -0.1 point to 69.2% LF. Yields rose +7.8% to 7.6 cents, helping boost international passenger revenue +9.8% to KRW914 billion. The freight segment continued to perform well as load factor improved +5.2 points to 79.2% LF and yield increased +6.8% to 26.4 cents.
(KAL) inaugurated nonstop service from Seoul Incheon to Istanbul. (KAl) now operates 3x-weekly, departing Incheon on Tuesdays, Fridays & Sundays, and Istanbul on Mondays, Wednesdays, & Saturdays, using an A330-300.
(KAL) will launch 3x-weekly Seoul Incheon to Los Angeles to Seattle 747-400F cargo flights on June 1.
South Korea and Thailand agreed to liberalize passenger services between the 2 countries. Cargo operations already are liberalized under a 2004 accord. The new agreement comes as the limit of 42x- weekly flights previously allowed by each nation's airlines is under strain, with load factors reported at 88% LF.
B/E Aerospace said (KAL) selected its MiniPod lie-flat business class (C) seats and a range of food and beverage preparation and storage equipment for its A380s and retrofit and new 777s. (KAL) also will install B/E food and beverage equipment on its A330s. Deliveries are scheduled to begin late this year.
(KAL) added a 747-400 and a 747-400F to its fleet last quarter and sold a 747-300F. It announced it exercised options for 2 747-400BCF kits, the 1st of which already is being installed by Boeing at Taikoo Aircraft Engineering in Xiamen. Touch labor and redelivery will occur at Korean's facility in Gimhae. (KAL) intends to use up to 20 kits to convert its own and 3rd-party airplanes. A modified 747-400 receives a side cargo door and a layout that is similar to the 747-400 production freighter. The 747-400BCF Boeing Converted Freighter is available with seating for up to 19 people in the upper deck, an option found on no other converted freighter.
June 2006: Korean Air (KAL) inaugurated nonstop charter service from Seoul Incheon to Yangon (Myanmar). (KAL) now operates 2x-weekly on Wednesdays & Sundays, using an A300-600. From July, the service will operate on Mondays & Thursdays, from Septebmber on Tuesdays & Fridays and (KAL) hopes to increase to 4x-weekly from November. (KAL) will launch 3x-weekly on Tuesdays, Fridays & Sundays, nonstop Incheon to Las Vegas service from September 22 aboard a 301-seat 777-200.
(KAL) Cargo inaugurated service from Seoul Incheon to Seattle via Los Angeles. (KAL) now operates 3x-weekly using a 747-400F.
9 SkyTeam (STM) Alliance member carriers signed a Memo of Understanding (MOU) with the British Airports Authority (BAA) confirming their co-location at London Heathrow (LHR)'s Terminal 4 in 2008, when the new T5 opens and the airport reorganizes. The alliance said nearly 3.5 million passengers travel through (LHR) each year aboard Aeroflot (ARO), Air France (AFA)-(KLM), Alitalia (ALI), (CSA) Czech Airlines, and (KAL). (KLM) already operates out of T4. AeroMexico (AMX), Delta Air Lines (DAL), and Northwest Airlines (NWA) are parties to the agreement and will have the option to take a place in T4 should they serve Heathrow (LHR) in the future.
The alliance will upgrade the terminal to include 32 check-in desks, additional luggage drop-off locations, lounges and space for self-serve kiosks.
747-4B5ERF (35525, HL7605), delivery.
July 2006: Korean Air (KAL) was the world’s busiest air cargo transporter for the 2nd consecutive year in 2005. Statistics from the International Air Transport Association (IATA) on air cargo transport show (KAL) in the lead with 7.98 billion ton, km. Ton, km is calculated by multiplying the volume of cargo traffic by flight distance and used as a criteria to compare cargo traffic performance of global airlines. German airline Lufthansa Cargo (LUB) came 2nd with 7.67 billion ton km and Singapore Airlines Cargo (SQC) 3rd with 7.63 billion. (KAL) has 19 747 Jumbo jet freighters, the largest number of such planes owned by a single airline. (KAL) plans to raise the number of freighters to 30 by rebuilding 2 or 3 747-400 passenger planes a year into cargo planes.
Korean Air Cargo will launch service to Stockholm Arlanda on a 2x-weekly Seoul to Vienna to Arlanda to Seoul route, beginning August 24 aboard a 747-400F.
(KAL) launched 3x-weekly service between Seoul Incheon and Hakodate.
August 2006: USA Cargo Sales Joint Venture, which handles USA cargo sales and marketing for SkyTeam Cargo carriers Air France (AFA), Delta Air Lines (DAL) and Korean Air (KAL), yesterday named Chang-Hoon Kang as its new (CEO). Kang, previously Managing VP Cargo Network & Revenue Management for Korean Air Cargo, replaces J D Cha, who was reassigned to Korean Air Cargo's Seoul headquarters.
(KAL) Cargo will increase Miami service from 1x- to 2x-weekly from August 24th. Routing goes as follows: Seoul Incheon to Anchorage to Miami to Dallas Fort Worth to Seoul Incheon and is operated by a 747-400F.
(KAL) inaugurated nonstop service from Seoul Incheon to Yantai (China). The airline now operates a daily flight using a 737-900. (KAL) inaugurated nonstop service from Seoul Incheon to Dalian (China). (KAL) now operates a daily flight using a A300-600.
(KAL) said it will ask Boeing for about $12 million to reimburse it for costs associated with preparing 29 airplanes for the "Connexion by Boeing" service that was pulled from the market. An airline official told "The Korea Times" that it cost $400,000 to furnish a plane with the Connexion service. (KAL) planned to introduce the service in an additional 25 airplanes by 2008.
(KAL) was the 1st Asian carrier certified by Boeing to introduce Connexion, the paper said, and accounted for 16% of the airplanes offering the Internet product world wide.
Boeing redelivered a 747-400F converted freighter to (KAL) in Seattle. Modification work was performed by (TAECO). (KAL) has entered the 747 cargo conversion market starting with 1 of its own 747-400 passenger airplanes. It will launch the program today at its Aerospace Division. It plans to convert 10 passenger jets through 2009. The program will lift its freighter fleet to 30 by 2010.
777-2B5ER (34208, HL7743), delivery.
September 2006: Korean Air (KAL) will today launch 3x-weekly Seoul to Vienna flights aboard 777-200s and said it "initially plans" to operate the service until October 27.
(KAL) will upgrade equipment on its Seoul to Fukuoka route on October 29th. The number of weekly flights will be reduced from 19 to 18, 2 daily flights along with a 3rd flight on Mondays, Wednesdays, Fridays, & Sundays, while (KAL) will go from an A300-600 to an A330-300 on all flights.
(JAL) and (KAL) are expanding their code share agreement from October 29 by +40% from the current 133x-weekly over 9 routes to 186x-weekly over 11 routes. Under the new agreement, the number of daily code share flights from Seoul Incheon to Tokyo Narita increases to 7, to Osaka Kansai to 5, and to Nagoya Chubu to 3.
Virgin Atlantic Airways (VAA) banned Apple and Dell laptop computer batteries from international flights following last month's recall of 1.8 million batteries by Dell as possible fire hazards. (VAA) passengers must remove the batteries from the computer, wrap them and place them in carry-on bags, reported the (BBC). Passengers can use the computers sans batteries in flight if seats are equipped with electrical sockets and can transport 2 of the batteries in a carry-on bag. (KAL) and Qantas (QAN) also have placed restrictions on laptop batteries in response to the recall.
October 2006: Korean Air (KAL) President & (COO) Jong Hee Lee projected (KAL)'s full-year 2006 net income will remain flat at about +$200 million on $8 billion in revenues. He said he was "disappointed" with the projected results and added that rising fuel prices are slowing growth. "Fuel has a terrible, big impact," he said, noting that (KAL) will pay +$500 million more in fuel expense in 2006 than it did last year. He pointed out that in an effort to save fuel, (KAL) started operating a polar route on flights from Toronto, New York (JFK) and Washington Dulles to Seoul Incheon, when Russia approved use of the route last month, shaving -40 to -50 minutes off flight time.
(KAL) signed a contract with China's Sinotrans Air, a subsidiary of logistics giant Sinotrans Ltd, to form a cargo joint venture (JV) airline in China. Sinotrans is taking a 51% stake, while (KAL) will own 25% and be responsible for filling the (CEO) and (CFO) positions. The balance of ownership was taken by 2 Korean investment companies, Hana Capital with 13%, and Shinhan Capital with 11%.
The Joint Venture (JV) will operate both Chinese domestic and international cargo flights, and is expected to launch operations during the 2nd half of 2007 with 3 freighter airplanes. Term of the (JV) contract is 30 years.
(KAL) Chairman & (CEO) Yang-Ho Cho said the (JV) will generate "tremendous synergy" and allow Korean Air (KAL)to "aggressively push forward by actively invading the Chinese logistics market, which will soon become the world's greatest." Beijing has been encouraging foreign airlines to set up cargo (JV)s in China.
The (KAL)/Sinotrans joint venture cargo airline will launch between June and September 2007 with 1 747F and 2 A300Fs based in Tianjin.
(KAL) Cargo President Ken Choi said that the initial 3 airplanes will come from (KAL). The A300Fs will be converted from passenger airplanes and the 747, either a 747-400F or 1 of 6 leased 747-200Fs (KAL) operates, will come from (KAL)'s freighter fleet. The joint venture (JV) will be expected to secure its own airplanes by its 2nd year of operation, when "they'll have to stand on their own feet," Choi said.
He explained that the (JV) is not expected to earn a profit for 3 to 4 years. "After 5 years, it should make a profit," he said. "The initial 3 years, we have to invest. The Chinese government said it will develop the Tianjin area. This is good timing for us."
(KAL) has signed a contract to build a 200,000-sq ft cargo terminal in Tianjin and will give the provincial government a stake in the terminal's ownership, Choi said. "The Chinese government supports the air cargo business," (KAL) President & (COO) Jong Hee Lee said. "1 of their big headaches is how to get air cargo from China to the world. They need airlines like (KAL) with world wide networks. Together with Sinotrans, we can make a successful cargo airline." He cautioned that the development of a "big cargo airline takes time. We'll start carefully."
(KAL) inaugurated nonstop service from Seoul Incheon to Las Vegas. (KAL) now operates 3x-weekly on Tuesdays, Fridays, & Sundays, using a 777-200.
Panasonic is considering taking over the Connexion by Boeing (TBC) in-flight Internet service when Boeing (TBC) ends it at year end, (KAL) President & (COO) Jong Hee Lee revealed. Lee said Panasonic has told (KAL), which equipped 29 airplanes with the service, at a cost of $400,000 per plane, that it will take over the program if it can be assured of firm orders to equip 500 airplanes with the service. <150 airplanes are believed to be outfitted with Connexion currently. "We are waiting to remove the equipment or continue through Panasonic," Lee said. He noted that <5% of passengers on airplanes with Connexion use the service, commenting that the $20 price for usage may be "too expensive." He said (KAL) was "very, very disappointed" that Boeing (TBC) decided to pull the plug. (KAL) has been reported to be seeking $12 million in compensation. Lee declined to confirm the figure and suggested that it may be higher.
(KAL) will place an order for 10 freighters by year end, most likely a combination of 777Fs and 747-8Fs, and also is "considering" orders for the 777-300ER and/or the 747-8 Intercontinental.
(KAL) Cargo President Ken Choi said (KAL) "definitely, for sure" will place an order for 10 freighters within the next 2.5 months. "The time is now pressing," he said. "We need them by 2010."
Choi explained that (KAL) is "still weighing" which airplane to order, but has narrowed its choices down to the 777F and 747-8F. It "was interested in the A380F, but it's too late now [given the delays to A380 production]," he said. "There is not much option left in [the long-haul freighter] market," and (KAL) "probably" will order both Boeing types. (KAL) President & (COO) Jong Hee Lee said the 777-300ER and 747-8 passenger version also are under consideration. VP Strategy Development Keehong Woo added that an order for new passenger airplane is forthcoming. "We need more airplanes in the future and we are talking with Boeing and Airbus," he said. When asked to characterize the size of the order to be placed, he said, "It's not small."
Lee also revealed that Korean (KAL) is looking at adding Houston to its network next year. It currently serves 13 destinations in North America. No decision has been made, but he said Houston-based SkyTeam partner Continental Airlines (CAL) would "welcome Korean Air (KAL)." After Houston, Miami is likely to be the next USA city added to its network, he said.
Additionally, (KAL) is planning to increase its services from Seoul Incheon to both Beijing and Shanghai to 3x-daily. (KAL) currently operates 8x-weekly to Beijing and 11x-weekly flights to Shanghai. The Chinese government already has given (KAL) regulatory authority to boost service to the 2 cities, but is still "looking at how to arrange the time slots" at crowded airports, Lee said.
Choi said Korean (KAL) also may add as many as 4 freighter destinations next year, with Tel Aviv, Istanbul, Mexico City and Moscow the leading contenders. "In order to maintain growth, we're looking at adding 3 or 4 points each year," he explained.
November 2006: (KAL) placed the biggest airplane order in its history, signing a purchase agreement valued at $5.3 billion for 10 777-300ERs, 5 737-900s/-700s, 5 747-8Fs and 5 777-200Fs.
The large order, signals (KAL)'s ambition to compete with the world's biggest international carriers. "The purchase forms a key component in (KAL)'s strategy of global expansion. (KAL) aims to maintain its title as the world's number 1 commercial cargo carrier [among passenger airlines, if Air France (AFA) and (KLM) are considered separate airlines] and to become 1 of the world's top 10 passenger carriers by 2010."
(KAL) also took options on 4 777-300ERs, 2 747-8Fs and 2 737-900ERs. The ordered airplanes will be delivered beginning in 2009 and continue through 2019. (KAL) said the 777-300ERs will replace 747-400s being converted to freighters, while the 747-8Fs and 777-200Fs will inject capacity into its rapidly expanding global airfreight network. (KAL) Cargo President Ken Choi said the 10 new freighters are part of a plan to add 2 freighters every year from 2009. It currently operates 19 owned 747-400Fs and 6 leased 747-200Fs.
(KAL) had been considering the 747-8 Intercontinental but elected to focus its long-haul fleet around the A380 (for which it has placed 5 orders), 787 (10 orders) and 777-300ER. It said the order was of particular importance given the ongoing liberalization of China's aviation market, which (KAL) considers critical to its future. "We have to focus on the China market," VP Strategy Development Keehong Woo said. "In the near future, the number of Chinese [traveling by air to destinations worldwide] will be huge. We have to go into that market or we won't survive." The new planes also will enhance "efficiency through modernization of the fleet and reduction in fuel and operational costs," (KAL) said.
1st 737-8GQ (35790, HL7757), with winglets, delivery - see photo. (KAL) has taken delivery of its 1st of 2 converted A300-600Fs. The airplane has been in the conversion process from passenger to cargo configurations at (EADS) (EDS) (EFW) in Dresden since August 2006. The 2nd airplane is currently undergoing conversion.
January 2007: Korean Air (KAL) is expecting to post a +KRW240 billion/+$255 million pre-tax profit in 2007, +33.3% higher than the +KRW180 billion expected for 2006, according to a regulatory filing cited by "Reuters." (KAL) also forecasted a +KRW640 billion operating profit, up +14.3% from the +KRW560 billion expected for 2006. This year's sales are expected to climb +3.6% year-over-year to KRW8.6 trillion.
Later, (KAL) said that it posted a 2006 net profit of +KRW344.7 billion/+$363.7 million, a +72% increase over the +KRW200.4 billion earned in 2005. Sales climbed +6.5% to a company-record KRW8.08 trillion and operating profit rose +15% to KRW497.4 billion. "Despite high oil prices, demand for travel to foreign countries increased," (KAL) said. Foreign exchange gains also were a factor in the result.
(KAL) launched services from Incheon to Kota Kinabalu (4x-weekly), Pattaya (3x-weekly), Kathmandu (weekly), Phnom Penh (4x-weekly), and Siem Reap (4x-weekly) while expanding services to Beijing and Shanghai in partnership with Shanghai Airlines (SHA). A 5x-weekly Busan to Beijing service was launched on December 15.
Korean Air (KAl) plans to increase the number of destinations served in China from the current 20 to 32 by 2010. According to North American Marketing Director John Jackson, (KAL) now regards China as a "2nd home market." Frequencies to current destinations will rise as well. "By the end of 2007, we'll be operating 3x-daily shuttles to Beijing, Shanghai and Hong Kong," Jackson said. The increase comes following a June 2006 agreement for a gradual "open skies" policy between China and South Korea. Passenger boardings rose from 290,000 in 1995, (KAL)'s 1st full year serving China, to 2.3 million in 2005. Freight grew from 7,400 to 21,000 tons.
(KAL) will launch 2x-weekly, Incheon to Vienna service on March 28, becoming 3x-weekly on June 1.
Korean Air (KAL) Cargo will launch 2x-weekly Seoul Incheon to Anchorage to Atlanta to Houston Bush to Anchorage to Incheon all-cargo service aboard a leased 747-400F from January 25. Houston is a new city on (KAL) Cargo's network. "Houston's dynamic business and logistics climate makes this an easy decision for us," (KAL) VP Cargo Americas Derek Han said. Starting March 28th, new 2x-weekly, Seoul Incheon (ICN) to Vienna, using 747-400s, and starting June 1st, this increases to 3x-weekly.
Last month, (KAL) took delivery of the 1st of 2 converted A300-600Fs.
(KAL) finalized its $5.6 billion order for 10 777-300ERs, 5 747-8Fs, 5 777Fs and 5 737NGs, along with options for +8 additional airplanes (4 777-300ERs, 2 747-8Fs and 2 737-900ERs). The purchase agreement was signed in November. Deliveries will begin in 2009.
737-8GQ (35791, HL7758), Pegasus (PGS) leased. 747-4B5BCF (24200, HL7412), delivery after conversion to freighter.
February 2007: Goodrich (BFG) reached a deal to provide landing gear Maintenance Repair & Overhaul (MRO) on Korean Air (KAL)'s fleet of 747s and 737NGs.
April 2007: The Engine Alliance (GP7200), which will power the A380, attained (EASA) (CS-E) certification, the (GE)-Aviation/Pratt & Whitney (P&W) joint venture announced. The USA (FAA) certified it in December 2005. Joint (EASA) and (FAA) airplane certification is expected by the year end. Emirates (EAD), Air France (AFA), Korean Air (KAL), and (ILFC) (ILF) have selected the engine.
May 2007: (KAL) launched new passenger service to Vienna in the 1st quarter, and also added Moscow and Chengdu to its all-cargo network.
(KAL) and Delta Air Lines (DAL) will increase the number of code share flights between Atlanta and Seoul to 11x-weekly from 7x-, using (DAL) airplanes for the 1st time beginning June 4.
China's new privately run Low Cost Carriers (LCC)s are looking to strategic investors as a method of raising capital, as it is becoming increasingly difficult to access traditional sources of bank lending, owing to the airlines' less-than-stellar financial performance. Juneyao (JYA) Group announced that its Juneyao Airlines (JYA) subsidiary is seeking a strategic investor to aid in (JYA)'s long-term development. The announcement was made after (JYA) said (JYA) was profitable in April and expects to post a full-year profit as well.
(JYA) (CEO) Huang Hui said that "the right candidate" should be an investment bank with ample experience in the air transport industry to aid both domestic and future international expansion.
Earlier this year, Spring Airlines (CQH) revealed its intent to seek a financial investor, when it posted a 2006 net profit of +CNY20 million/+$2.6 million on revenue >CNY500 million. Interestingly, in 2004, Spring (CQH) rejected a proposal by Singapore Airlines (SIA) to acquire a 40% stake. Spring (CQH) spokesperson Zhang Lei told "Finance Magazine" that the company has talked with Merrill Lynch, Goldman Sachs and Citigroup, but no deal has been reached. He noted that while the (LCC) is seeking new investment, it is not interested in selling a majority stake. Insiders speculate it will have to raise at least CNY3 billion to support last October's order for 10 A320s.
The desire to attract investment, without sacrificing control, played out in the failed deal between Okay Airways (OKA) and (KAL). In August 2005, (OKA) signed a letter of intent (LOI) with (KAL) under which (KAL) and another Korean company were to have acquired 49% of the airline, but both sides walked away over the issue of control. "(KAL) wants to assume the presidency and take up equal seats on the board with us, which we can't accept. Even if they don't have controlling stake, conflicts will still arise," (OKA) Chairman Liu Jieyin explained.
777-2B5ER (34209, HL7750), delivery.
June 2007: Starts Seoul (ICN) to Madrid, using 777-200s.
Korean Air (KAL), saying it "shall no longer remain indifferent to the invasion of low-cost carriers from China and SE Asia into the Korean market," announced plans to launch a Low Cost Carrier (LCC) within 3 years, that will operate flights on domestic and short and mid-range international routes, using 737s. The plan's unveiling, culminated a process that began in 2005 when a (KAL) task force started studying the feasibility of the airline operating its own (LCC). It said it is considering launching the new carrier, via Korea Airport Service, a sister company owned by parent Hanjin Group, that has experience operating charter flights, rather than starting a new company from scratch. "Within 2 or 3 years, when Korea's high-speed railway is completely open for service, much of the domestic air traffic demand is expected to shift to the railway, inevitably calling for a restructuring of domestic route flight operations," (KAL) said. "It is (KAL)'s conclusion that it must develop new markets and business models to effectively utilize the fleet that will be freed from domestic operations. Unlike the past, when strict government regulations restricted the establishment of new airlines, deregulation and spreading "open skies" policies has lowered the bar for new players."
July 2007: The (CAAC) (CAC) officially approved the launch of the Tianjin-based joint venture (JV) cargo airline to be owned and operated by Chinese logistics firm Sinotrans and Korean Air (KAL). The new entity has a registered capital of $65 million, in which Sinotrans Air Transportation Development Company holds a 51% stake with an investment of $33.15 million. (KAL) invested $16.25 million for a 25% stake. Minority shareholders are Hana Capital Company (13%) and Shinhan Capital (11%). "So far we haven't figured out the specific plans for the new (JV)," Sinotrans Air Transportation Development Company President, Zhang Jianwei said. (KAL) Cargo President Ken Choi has said it will launch with 1 747F and 2 A300Fs. The initial 3 airplanes will come from (KAL), but the (JV) will be expected to secure its own planes by its 2nd year of operation, when "they'll have to stand on their own feet," Choi said.
Beijing has been encouraging foreign carriers to launch cargo (JV)s with Chinese companies to keep pace with China's surging export market. China Southern (GUN) recently confirmed it is in negotiations with Air France (AFA)/(KLM) to form a cargo airline.
August 2007: Antitrust authorities on both sides of the Atlantic levied heavy fines against British Airways (BAB) and Korean Air (KAL) for their participation in conspiracies to manipulate fares and surcharges on both passenger and freighter flights throughout this decade. The carriers, which pleaded guilty and have agreed to the penalties, are among several that have been under investigation by the USA Department of Justice (DOJ) and the UK Office of Fair Trading (OFT) since last year. European and USA authorities launched their probe into an alleged cargo price-fixing cartel 18 months ago and soon thereafter were joined by counterparts in Asia. In June 2006, (BAB) and Virgin Atlantic Airways (VAA) were targeted for colluding on passenger fuel surcharges. A portion of those investigations came to end with the guilty pleas and the announcement that the (DOJ) will fine (BAB) and (KAL) $300 million each, while the (OFT) exacted its own £121.5 million/$246.8 million punishment on the UK flag carrier.
"The Department of Justice is committed to vigorous antitrust enforcement and will continue to bring to justice those who fix prices and thereby deprive the American public of the benefits afforded by a truly competitive market," Attorney General Alberto Gonzales said.
(BAB), which admitted its indiscretion in May, and set aside £350 million to cover potential fines, increased its fuel surcharge on "virtually every" long-haul ticket from $10 in 2004 to nearly $110 2 years later, the (DOJ) said. Freight surcharges rose to 72 cents per kg in 2006 from 4 cents in early 2002. (BAB) was guilty of "participating in meetings, conversations and communications" to discuss, establish and monitor the increased rates and surcharges, the (DOJ) claimed. (BAB) detailed at least 5 distinct fuel surcharge increases that followed communication among carriers. "I want to reassure our passengers that they were not overcharged. Fuel surcharges are a legitimate way of recovering costs," (BAB) (CEO) Willie Walsh said. "However, this does not in any way excuse the anticompetitive conduct by a very limited number of individuals within (BAB). Anticompetitive behavior is entirely unacceptable and we condemn it unreservedly."
(BAB) said (VAA) was not subject to prosecution or penalty, because it brought the collusion to the attention of authorities, although the (DOJ) said it will have to pay restitution to USA "victims." (BAB) added that the penalty imposed by (OFT) was reduced to reflect its cooperation with the investigation.
(KAL), meanwhile, was charged with conspiring to fix fares charged to passengers and travel agents on flights to the USA between January 2000 and July 2006, and on international cargo flights from January 2000 to February 2006. The (DOJ) did not name (KAL)'s co-conspirators. (KAL) said it "worked hard" to cooperate with the investigation and was "pleased to be among the 1st airlines to have reached a full resolution of the matter."
The (DOJ) said Lufthansa (DLH) has joined Virgin (VAA) in the (DOJ)'s Corporate Leniency Program, which will allow it to "avoid criminal conviction and a heavy fine." (DLH) agreed last fall to pay $85 million to settle class-action lawsuits related to the probe. American Airlines (AAL) and United Airlines (UAL) reached non-monetary settlements in similar cases, while FedEx (FED) acknowledged being subpoenaed last summer.
Owing to this $300 million fine, it agreed last week to pay to the USA Department of Justice for antitrust violations regarding fares and surcharges, (KAL) reported a 2nd-quarter net loss of -KRW214 billion/-$229 million, a significant decline from a net profit of +KRW14.9 billion in the year-ago quarter. Operating revenue increased +8.9% to KRW2.11 trillion as operating expenses rose +8.9% to KRW2.03 trillion, producing operating income of +KRW75.4 billion, a +9.3% improvement over +KRW69 billion in the year-ago quarter. (KAL) counted the (DOJ) fine as a nonoperating expense and said the charge was reflected fully in its 2nd-quarter results, but it noted that the amount actually will be paid in 6 installments over a period of 5 years.
Domestic traffic fell -5.2% to 963 million (RPK)s on a -8% drop in capacity to 1.26 billion (ASK)s, producing a load factor of 76.3% LF, up +2.3 points. Domestic yield was ahead +5.6% to 16.9 cents. International traffic rose +6.9% to 12.74 billion (RPK)s on a +6.1% lift in capacity to 17.38 billion (ASK)s, producing a load factor of 73.3% LF, up +0.5 point. International yield was 8.5 cents, up +7.6%.
Cargo traffic climbed +15.8% to 2.44 billion (FTK)s on a +15.8% lift in capacity to 3.22 billion (ATK)s, producing a load factor of 75.9% LF, down -0.4 point. (KAL) said cargo yield "remained sluggish," dropping -6.5% to 24.3 cents, owing in part to "intensifying competition from other modes of transport."
Malaysia Airlines (MAS) appointed George Snyder as its Senior Technical Consultant, Safety & Security. Snyder was closely associated with the operational and safety turnaround at (KAL) in the early part of the decade, when he served there as Senior VP Corporate Safety, Security & Compliance. Prior to that, he was US Airways (USA)'s VP Safety & Regulatory Compliance.
(KAL) took delivery of a 777-2B5ER (34210, HL7751) (Extended Range). The Boeing Everett plant, which is 40 years old this year, has built and delivered 3,000 wide body airplanes, including the 747, 767 and 777 models.
(KAL) now has a fleet of 123 airplanes, which includes 13 777-200ERs, 4 777-300s, 24 747-400s and 21 747-400F. (KAL) will use the new 777 for long-haul business routes to the Americas, Europe and the Middle East.
(KAL) also has 35 additional airplanes on order, including 777-300ERs, 777Fs, 747-8Fs and 787 Dreamliners. In addition, (KAL) has 4 737s on order.
September 2007: Korean Air (KAL) Cargo is launching 2x-weekly 747-400F service to Munich from Seoul Incheon, via Moscow.
October 2007: Korean Air (KAL) credited increasing long-haul revenue and rising yields for a +3.9% year-over-year gain in profit to +KRW131.7 billion/+$144.7 million in the quarter ended September 30.
Revenue jumped +8.1% year-over-year to KRW2.37 trillion, and operating profit soared +45.2% to +KRW281.4 billion, as operating expenses climbed just +4.6%. "We have continued to deliver impressive results," President Jonghee Lee said. "We are particularly pleased to see the growth in international passenger and cargo margins. For the remainder of 2007, we will continue to expand our market, improve our yield and adopt stringent cost control to create even better value for our shareholders." (KAL) said yield in USA dollars grew +6.8% during the quarter, and international passenger revenue rose +9.8% to KRW1.31 billion, as higher sales, more premium traffic, and the addition of charter flights to holiday resort destinations, boosted turnover. Domestic revenue fell -1.3% year-over-year, but (KAL) said load factor and yield were up. 3rd-quarter cargo revenue increased +6.3% to KRW631 billion.
(KAL) launched daily Seoul Gimpo to Shanghai Hongqiao service.
(KAL) released further details about its new low-cost carrier (LCC), a project it originally said could launch within 3 years, but that now is scheduled to take flight next May. The new carrier, dubbed "Air Korea," will start operations with 3 A300s and 2 737s flying mainly leisure travelers to Japan, China, Thailand and Malaysia. The move is seen in part as a response to the recent Joint Venture (JV) between Singapore-based Tiger Airways (TGR) and Incheon city authorities "Incheon Tiger Airlines" to establish their own low cost carrier (LCC).
November 2007: 777-2B5ER (34211, HL7752), delivery.
December 2007: Sinotrans Air Transportation Development Company and Korean Air (KAL) will expand on their cargo agreement with construction of a new freight station in Tianjin. The joint venture will launch with $14.9 million in capital, of which Sinotrans Air contributed $3 million for a 20% stake while (KAL) invested $7 million for a controlling 47% stake. Other investors are Air Korea, the Hanjin Group and Dongliqu Economic Investment Company. The station will be developed in 2 phases. Construction of the 1st is scheduled to begin in 2008 and be completed in the 2nd half of 2009, with an annual handling capacity of 380,000 tons. There is no timetable for the 2nd phase. Sinotrans and (KAL) are preparing to launch "Grand Star Cargo International Airlines," which is expected to receive (CAAC) approval this month. Sinotrans Air President, Zhang Jianwei noted that "Grand Star" will be based at Tianjin, from where it will launch its inaugural flight to Frankfurt in January.
777-2B5ER (34214, HL7764), delivery.
January 2008: 2007 statistics: 55.35 billion (RPK)s passenger traffic +6.1%; +6% capacity (ASK)s; +.1 load factor for 72.7% LF. SEE ATTACHED COMPARISON CHART TO SELECTED OPERATORS - "KAL-2007-STATS."
(CSA) Czech Airlines will expand its codeshare with Korean Air (KAL) to cover flights from Prague to Bratislava, Zilina, Ostrava, and Budapest, and negotiations are ongoing concerning (KAL) flights to Japan. (KAL) currently puts its code on (CSA) flights to 13 destinations in Western Europe.
Korean Air (KAL) promoted Jay Lee to Managing VP & Regional Director, North & South America.
Airlines throughout the world are contending with antitrust charges made at the end of 2007 by the European Commission (EC), which has accused at least 11 and as many as 25 carriers of "cartel" activity relating to airfreight transport. In addition to British Airways (BAB), Japan Airlines (JAL), Air France (AFA)/(KLM), (SAS) Group, and Cargolux (CLX) (all of which confirmed receipt of statements of objections from the (EC) before Christmas). (ANA), Air New Zealand (ANZ), Air Canada (ACN), Cathay Pacific Airways (CAT), (LAN) and Singapore Airlines (SIA) have admitted to being charged. Carriers charged late last year, have 2 months from the receipt of statements of objections to respond in writing to the (EC) and also have the option of requesting a formal hearing.
When will it end? That's the question airlines throughout the world are asking regarding the multiple investigations into alleged antitrust violations relating to air cargo transport. The probes, conducted cooperatively by the USA Dept of Justice (DOJ), the European Commission (EC), and regulatory agencies in a number of countries, were launched in February 2006 with surprise raids of airline headquarters around the globe, and already have led to the imposition of significant fines against several leading international carriers. Since the alleged wrongdoing (mainly centered on airfreight rates and fuel and security surcharges) involves international carriage of cargo across numerous borders, airlines are not facing merely one, or even just two or three, investigations. British Airways (BAB), for example, already has been assessed fines by the (DOJ) and the UK Office of Fair Trading, and last month was one of at least 11 airlines officially charged by the (EC). Carriers are also targets of a multitude of lawsuits brought by customers claiming to be "victims" of "cartel" activity. In addition, the (DOJ)'s probe in some instances has moved beyond airfreight to uncover improprieties in passenger charges. Potential liability is stretched far and wide, making it impossible for airlines simply to pay a fine or settle a single lawsuit and move on. The good news is that they are not alone. Qantas (QAN) (CEO), Geoff Dixon, whose carrier has agreed to pay a $61 million fine imposed by the (DOJ) relating to cargo rates, says the USA government is investigating as many as 30 airlines. (LAN), one of the companies to receive a formal statement of objections from the (EC) last month, says the Commission (EC) charged 25 carriers with violations.
On the flip side, the bad news for airlines also is that they are not alone. Indeed, the primary allegation made by authorities is that carriers throughout the world repeatedly colluded with each other.
Both (BAB) and Korean Air (KAL) pled guilty last year in a USA federal court to criminal conduct relating to airfreight rates and cargo, plus passenger surcharges, and each paid a $300 million fine. The (DOJ) charged (BAB) "with engaging in a conspiracy to suppress and eliminate competition by fixing the rates charged to customers for international air shipments of cargo" from March 2002 to February 2006. It said (KAL) had been "fixing the rates" on international cargo shipments in coordination with other airlines "from at least January 2000 to February 2006." (BAB), (KAL), and (QAF) all pled guilty to participating improperly in "meetings, conversations and communications" with other airlines to discuss and agree on cargo rates to be charged on key trade lanes and to "levying cargo rates in accordance with agreements reached" during those communications and then engaging in further meetings and communications "to monitor and enforce the agreed-upon rates." The (DOJ) noted that during the nearly four-year period of its wrongdoing, (BAB)'s "fuel surcharge on shipments to and from the United States changed more than 20 times and increased from four cents per kg of cargo shipped to as high as 72 cents per kg."
The (DOJ) has said that Virgin Atlantic Airways (VAA) and Lufthansa (DLH) entered into its "Corporate Leniency Program" and avoided criminal charges and fines by detailing their participation in anticompetitive practices with (BAB) (in (VAA)'s case) and with both (BAB) and (KAL) (in (DLH)'s case). (VAA) and (DLH), though, still are liable for paying restitution "to the USA victims of their conspiracies," the (DOJ) said, and (DLH) has settled a string of lawsuits filed in the USA for a collective $85 million.
Given the wide-ranging nature of the charges against (BAB), (KAL), and (QAN), the (DOJ) likely is far from through with charging airlines. It says its investigation is "ongoing." The (EC), meanwhile, issued charges in late December against carriers "concerning their alleged participation in a cartel in the provision of airfreight services." At least 11 have confirmed receipt; formal replies to the charges are due next month. An airline found guilty or admitting to guilt can be fined up to 10% of its annual revenue. Additionally, the Australian Competition and Consumer Commission is considering issuing formal charges against airlines, and FedEx (FED) revealed last month that it was subpoenaed by the (DOJ) to produce documents and appear before a grand jury in relation to an investigation into potential airfreight forwarding antitrust violations that apparently is a separate probe from the one that nabbed (BAB), (KAL), and (QAN). "We do not believe that we have engaged in any anticompetitive activities," FedEx (FED) said. The widespread, global nature of the investigations raises the question of whether practices that were standard, common procedure in the industry just a few years ago, now are being declared illegal.
Authorities were moved to act in part by shipper complaints of repeated hikes of fuel and security surcharges, that were enacted by cargo-carrying airlines in recent years to mitigate rapidly rising energy prices and the costs of complying with post "9-11" regulations. When one or two airlines announced they were raising such fees, others quickly followed. But isn't that what routinely happens regarding passenger fares? And why would airlines issue press releases detailing the hikes within days of each other, if they were colluding secretly with one another? The (DOJ)'s description of repeated improper "meetings," however, does cast doubt on the argument that carriers merely were responding prudently to competitors and rising costs. Airlines generally have not commented on the issue beyond official legal statements and expressions of their commitment to follow all applicable competition laws.
February 2008: Korean Air (KAL) posted 2007 net income of +KRW11 billion/+$11.7 million, a -97.1% drop from +KRW383 billion earned in the prior year, that it attributed to high fuel costs and the won's weakness. (KAL) said it is hopeful new surcharges aimed at offsetting fuel costs and a surge in demand related to this year's Beijing Olympics, will help it turn around its financial fortunes in 2008. Operating revenue for 2007 rose +9.1% to KRW8.8 trillion, while expenses increased +7.8% to KRW8.18 trillion, producing operating income of +KRW637 billion, up +28% over KRW497 billion the prior year.
Domestic traffic fell -6.5% to 3.49 billion (RPK)s, on a -8.2% lowering of capacity to 4.97 billion (ASK)s, producing a load factor of 70.2% LF, up +1.3 points. Domestic yield increased +5.4% to 17.7 KRW cents. International traffic rose +7.1% to 51.87 billion (RPK)s on a +7.1% lift in capacity to 71.21 billion (ASK)s, producing a load factor of 72.8% LF, down -0.1 point. International yield increased +8% to 8.9 KRW cents. The carrier recorded a -KRW35 billion net loss for the fourth quarter, reversed from a +KRW114 billion profit in the year-ago period.
(KAL) placed a firm order for 3 additional A380s, bringing its commitment to the jumbo jet to 8. The newly ordered airplanes are scheduled to arrive in 2012 to 2013. (KAL) expects its 1st A380 in 2010, when it will introduce the plane on routes to the western USA.
The A380 program now boasts 192 firm orders from 16 customers.
March 2008: Varig (VAR) and Korean Air (KAL) announced a comprehensive interline agreement.
(KAL) will launch 3x-weekly, Los Angeles to Sao Paulo Guarulhos on June 2, aboard a 777-200.
Enigma said (KAL) selected its InService Maintenance Repair & Overhaul (MRO) and Oracle Complex (MRO) solutions to streamline maintenance operations across its fleet of A300, A330, 737, 747 and 777 airplanes. Features include comprehensive airframe, engine and component maintenance data, as well as troubleshooting, repair and reporting capacities.
April 2008: Korean Air (KAL) said that its 1st quarter operating income dropped -87.1% to +KRW19.6 billion/+$19.5 million "owing to the huge pressure from surging fuel costs." "The soaring cost of fuel has become a great challenge for airlines around the world as well as in Korea," President, Jong-Hee Lee said. "[But] the weakening Korean won has boosted Korean exports and inbound cargoes from the USA and Europe to China, and other Asian countries, and we expect this trend will continue. With our strength in the cargo business, we are confident we can grasp these opportunities to maintain the current growth rate for revenue and yield."
Revenue increased +11.5% to KRW2.27 trillion, as international passenger revenue rose +10.1% and cargo revenue grew +17.8%. International passenger yield and cargo yield lifted +8% and +15%, respectively. (KAL) said its yield improvement on international routes was attributable to a rise in premium class revenue, higher fares and fuel surcharges.
Asiana Airlines (AAR) has bought into planned new airline, Busan International Air (BIA), in another sign that South Korea may emerge as a major market for low cost carrier (LCC) operations. Asiana (AAR) paid 23 billion won/$24 million for a 46% stake. Busan International (BIA) is one of several new carriers planned in South Korea. (KAL) plans to establish late this year Air Korea as a new low cost carrier (LCC) subsidiary, while Singapore-based Tiger Airways (TGR) plans to launch next year, an associate airline in South Korea in partnership with the Incheon government.
May 2008: Korean Air (KAL) is on target to begin scheduled operations of its new low-cost subsidiary "Air Korea" by July, VP International Affairs & Alliances, Bang Sun Oh said in Seoul. "(KAL) can't serve the low-cost demand," Bang said. 1st flights with a single airplane will operate between Seoul Gimpo and Jeju. The Low Cost Carrier (LCC)'s fleet eventually will comprise up to 5 airplanes: a mix of A300-600s, and 737-800s. Air Korea will fly only domestically, Bang said. There were indications last fall that (KAL) had designs on an international operation.
"We have all the licenses," Bang said. "There are lots of (LCC)s coming into Korea. If we compete, I'm sure we will win."
Later, (KAL) appointed Jae Kun Kim as (CEO) of its new low-cost carrier "Air Korea" which plans to launch in July with services on the Seoul to Gimpo route using Boeing 737-800s. A (KAL) spokesman in Seoul said Kim previously “was in the sales department of (KAL) and was also a team leader for Southeast Asia route development”. He says the airline is on track to launch in July as planned and its 1st scheduled service will be from Seoul Gimpo to the South Korean island of Jeju. This is the country’s busiest domestic route and Jeju is a popular tourist destination for South Koreans. Air Korea this year will have a fleet of 2 737-800s and 2 A300-600s and all these airplanes will be leased from (KAL).
Early next month (KAL) will have recruited a total of 70 employees, the number required for launch, and by year-end, it will have launched services to more destinations and increased its workforce to 120. Air Korea already has offices at Seoul Gimpo, Busan, and Jeju airports. Air Korea plans to also launch services on the Seoul Gimpo to Busan route. Busan is South Korea’s 2nd largest city.
(KAL) is looking forward to the May 31 SkyTeam (STM) meeting in Istanbul, at which alliance members will consider adding another partner, most likely one from India, Latin America or SE Asia. "Those are the areas we are focused on," he said. (KAL) was instrumental in bringing China Southern Airlines (GUN) into SkyTeam (STM) last November, he said. "We helped them to establish global standards. It improves connections to have a Chinese member carrier."
Incheon International (ICN) completed the 2nd phase of its construction and will open the new facilities next month. Upgrades, which took six years to build at a cost of approximately $4 billion, include a new passenger terminal, a 4,000-m runway, that will accommodate the A380 and an automated passenger transport system. (ICN) now will be capable of handling 50 million passengers and 5 million tonnes of cargo per year.
(KAL) is eyeing opportunities to expand its market share in North America, using Incheon as a gateway hub to China, General Manager North America, Song Bo Young said in Seoul. (KAL) currently serves 23 Chinese destinations, and also will promote Incheon as a gateway from the USA to Vietnam, Malaysia, and Singapore. The proposed merger between Northwest Airlines (NWA) and Delta Air Lines (DAL), which already are codeshare partners with (KAL) through SkyTeam (STM), will strengthen its North American market position, Song said. Last year, North American service added some $800 million to (KAL)'s bottom line. "We think we have enough gateways in the USA," he said. "Now we want to make alliances in each area." He said the carrier soon will announce a codeshare agreement with Alaska Airlines (ASA) that will enable it to expand its presence in the Pacific Northwest and Alaska. "Next year, we expect to increase traffic to Las Vegas and Dallas."
A380s (8 are on order), which are scheduled for delivery beginning in 2010, will be used on flights to New York (JFK) and Los Angeles. (KAL) also is a launch customer for the 787 with 10 firm orders. Last September, it launched a television advertising campaign in the Washington area, that is beginning to pay off in greater name recognition and brand awareness, Song said. This June, it will begin flying to Sao Paulo Guarulhos via (LAX). "We expect a growing economy between Asia and Brazil. We are focusing on that market," he said. (KAL) has a codeshare with (LAN) Airlines and is working on establishing one with a Brazilian carrier. Song said that Mexico likely will be the next destination announcement, but timing is uncertain.
777-2B5ER (34212, HL7765), delivery.
June 2008: Korean Air (KAL) will launch 3x-weekly, Los Angeles to Sao Paulo Guarulhos aboard a 777-200. (KAL) has started a 3x-weekly flight from Munich (Wednesday, Friday, Sunday) to the South Korean capital city of Seoul. The service is with 777-200s, with a capacity of 260 seats. (KAL) already flies daily from Frankfurt with a 747-400 to Seoul. Together with Munich, (KAL) will fly 10x-weekly from Germany to Korea. “With this new non-stop-service between Munich and Seoul, we are responding to a continuously growing demand on this route in both directions. The main reason for choosing Munich as the second German Airport for (KAL) to fly to, is because it is a key dynamic economic region,” comments Yong Soon Park, Managing VP Europe, Middle-East & Africa. The (KAL) flight KE916 which started 1st June, departs from Munich at 8.45 pm and arrives at 2.05 pm the next day in Seoul. The return flight from Seoul (Incheon) to Munich is KE915 departing at 2.25 pm, arriving the same day at 6.55 pm in Munich. All seats of the 777-200 are equipped with (AVOD).
As of June 2008, (KAL) will serve 13 airports in Europe, including Munich, and a 3x-weekly return service to Vienna.
Korean Air (KAL) changed the name of its short-haul domestic Low Cost Carrier (LCC), slated to start operations next month, from "Air Korea" to "Jin Air." (KAL) said the name change is intended to signal the carrier's "practical" approach, also to be signified by employee uniforms comprising jeans, t-shirts and jackets. The (LCC)'s livery will feature a butterfly with blue and purple wings on a bright green background emblazoned on the tails of its 737-800s and A300-600s. The bodies of the airplanes will be painted silver. Jin Air employees will be called Jini, "reminiscent of Aladdin's magical genie."
Air France (AFA)/(KLM), Cathay Pacific Airways (CAT), Martinair (MTH) and the (SAS) Group all reached agreement with the USA Department of Justice (DOJ) to plead guilty in USA court and pay criminal fines "for participating in a multiyear conspiracy to fix prices for air cargo rates," the (DOJ) said. (AFA)/(KLM) will pay a $350 million fine, (CAT) has agreed to pay $60 million, (MTH) $42 million, and (SAS) $52 million, bringing the total imposed by the (DOJ ) during its investigation into air cargo antitrust violations to $1.27 billion. The figure marks the highest amount ever imposed by the antitrust division in one investigation. British Airways (BAB), Korean Air (KAL), Japan Airlines (JAL), and Qantas (QAN) already have pled guilty and paid fines. In addition, a former (QAN) executive will serve 8 months in a USA jail as a result of the investigation.
(AFA)/(KLM) Chairman & (CEO) Jean-Cyril Spinetta said the company has "taken thorough steps across the organization to prevent recurrence." (SAS) President & (CEO) Mats Jansson said there are "various control mechanisms" in place to prevent antitrust violations, adding that it was "very unfortunate and a serious problem that our policies were not fully observed in this case." Cathay (CAT) (CEO) Tony Tyler said that airline "carefully considered all applicable factors and concluded that entering into this agreement at this time presents the best resolution to the investigation," adding that "it transpired that some of our actions relating to shipments from Hong Kong to the USA were in conflict with USA antitrust laws, and we very much regret this."
The (DOJ) said that "the airlines each engaged in a conspiracy to suppress and eliminate competition, by fixing the cargo rates charged to customers for international air shipments. The charged conduct affected billions of dollars of consumer and other goods shipped by these airlines and their competitors." Associate Attorney General, Kevin O'Conner added that the "price-fixing conspiracy undermines our economy and harms the American people who, due to lack of true competition in this area, end up footing the bill." The (DOJ) said its investigation is ongoing. Both Air Canada (ACN) and El Al (ELA), which were not included in the agreements recently announced, said they have made provisions for possible settlements with the (DOJ) regarding cargo antitrust violations. The European Union (EU) and other government agencies throughout the world, also are conducting continuing investigations into alleged anticompetitive airfreight rate practices.
Grandstar Cargo International Airlines (GSC), the (KAL)/Sinotrans joint venture (JV) airfreight carrier based in Tianjin, operated its inaugural flight to Frankfurt using a 747-400F freighter. (KAL) and the Chinese logistics firm first announced plans for the airline in 2006 and gained (CAAC) (CAC) approval in July 2007. It is 51% owned by Sinotrans Air Transportation Development Co, 25% by (KAL), 13% by Hana Capital Co, and 11% by Shinhan Capital Co. "Its business scope covers domestic and international, cargo and mail air transportation, and relevant business, leasing of airplanes for self-use, repair and maintenance of self-used airplanes, airplane charter business, inter-airline agency services, import and export services, and related ground services," (KAL) said in a statement, adding that Grandstar (GSC) "will mainly provide international scheduled and nonscheduled air cargo transportation services."
(GSC) plans to add a second 747-400F and two A300-600Fs to its fleet later this year. It will operate flights to Shanghai and to European cities, and eventually to the USA, (KAL) said. (KAL) Cargo President, Ken Choi has said that the carrier's initial airplanes are from (KAL)'s fleet, but that the (JV) will be expected to secure its own planes by its 2nd year of operation.
July 2008: In September, Korean Air (KAL) will stop seasonal service to St Petersburg, Russia, but start flights to Tel Aviv, Israel (where Korea's many Christians make pilgrimages), and Tashkent, Uzbekistan (a major point on the historic Silk Road).
Korean Air (KAL) and Alaska Airlines (ASA) announced a code share agreement. From August 1, (KAL) passengers will be able to connect to (ASA) from Seattle, Los Angeles, and San Francisco, while (ASA) passengers will be able to connect to (KAL) flights to Asia from those cities. Reciprocal frequent-flier benefits begin September 6.
2 737-800s, (ILF) 8 year leased.
August 2008: The Korean won continues to lose value versus the USA dollar, which is; bad for Korean Air (KAL)’s cost base.
(KAL) currently is taking applications from type rated and non type rated pilots (FC) with similar experience, who are willing to obtain a type rating upon successful interview. The maximum interview age for (KAL) has increased from 56 1/2 years old to 58 years old.
The South Korean government will sell a 49% stake in Incheon International Airport, "which includes a strategic tie-up with a foreign airport operator to secure international competitiveness," according to a statement cited by "Reuters."
Korean Air (KAL) operates 102 passenger airplanes: 31 737NGs; 33 747s; 33 777s; 19 A330s; and 24 747F and A300F freighters.
November 2008: The dramatic collapse in the value of the won was blamed for Korean Air (KAL)'s largest single-quarter loss in 14 years, a -KRW684.1 billion/-$492.8 million third-quarter deficit representing a reversal from a +KRW129.6 billion profit in the year-ago period. The result came on the heels of a -KRW288.9 billion loss in the 2nd quarter, when fuel prices savaged (KAL). The 3rd-quarter loss came despite a +16.4% year-over-year rise in (KAL)'s revenue to KRW2.76 trillion.
The won's decline has made travel for Koreans more expensive, raised the value of any USA dollar-denominated debt and adversely affected the price of jet fuel, despite the recent decline in fuel prices. (KAL) booked a -KRW905.6 billion loss after converting USA dollar and Japanese yen debt into won, according to a company statement cited by press reports from Seoul. The Korean currency has fallen -33% this year. Fuel costs remained high. The carrier spent KRW1.26 trillion during the quarter, up +83% year-over-year. Its operating result swung to a -KRW2.51 billion loss from a +KRW281.4 billion profit in the 3rd quarter of 2007.
Domestic traffic declined -3.1% to 845 million (RPK)s against a -2.4% fall in capacity, dropping load factor -0.5 point to 68.6% LF. Yield decreased -8.5% to KRW192. International (RPK)s were level at 13.91 billion, with loads dipping -0.8 point to 74.2% LF and yield down -14.1% to KRW99.5
Its 9 month loss of -KRW1.3 trillion compared to a +KRW46 billion profit in the 1st 9 months of 2007. Its operating result swung to a -KRW121.9 billion loss from a +KRW508.2 billion profit.
(KAL) said that "given current economic conditions, air travel demand will continue to slow down" in the current quarter, the "Associated Press" reported. On the bright side, it said it will "realize significant benefits" when Koreans become eligible for the USA visa waiver program this week. Director Marketing Americas, John Jackson said the number of Korean visitors to the USA is expected to rise +10% in the 1st year of the program, with (KAL)'s transpacific capacity increasing +5% to +7%.
(KAL) appoints its 1st 2 female captains - - SEE ATTACHED - - "KAL-FC-NOV08."
December 2008: Korean Air (KAL) will increase its 4x-weekly, Incheon to Washington Dulles 777 service to daily, beginning December 11.
January 2009: Korean Air (KAL) will begin upgrading its long-haul premium seating in May when it takes the 1st of 3 777-300ERs slated to be delivered this year. The new airplanes as well as 3 current 777s will be fitted with the new seats by year end and deployed to New York (JFK) and Los Angeles. (KAL)'s entire wide body fleet eventually will feature the new seats, including A380s scheduled to begin delivery next year and 787s. Key components of the upgrade will be replacing 170-degree business-class (C) seats with 180-degree lie-flat seats and enlarging first class (F) In-Flight Entertainment (IFE) monitors to 23 inches.
February 2009: Korean Air (KAL) reported a full-year 2008 net loss of -KRW1.96 trillion/-$1.4 billion, reversed from a net profit of +KRW11.1 billion in 2007, citing the weak won as the biggest contributor to the heavy deficit. (KAL) also said that it is boosting its A380 order from 8 airplanes to 10 and will initiate "more aggressive investment" this year with the aim of achieving a "black ink balance" in 2009 while building "a foundation for future growth." It said it will focus on "increasing overseas travel demand through its Incheon (ICN) hub," acknowledging that demand among South Koreans has waned and transit traffic through (ICN) likely presents the best path to profitability.
(KAL)'s full-year revenue rose +15.9% to KRW10.21 trillion and its operating loss was -KRW99.3 billion, reversed from an operating profit of +KRW636.8 billion in 2007. It posted a 4th-quarter net loss of -KRW659.5 billion, the 2nd straight quarter in which it has recorded a deficit greater than -KRW600 billion. It projected a full-year 2009 operating profit of +KRW600 billion if per-barrel crude oil prices average $75 or less.
The 2 additional A380s ordered will be delivered in May and June 2014, with the first eight on order expected to arrive from 2010 to 2013. The (KAL) board has decided to order an additional 6 A330s. 2 airplanes will be delivered next year, followed by 2 in 2011 and 2 in 2013. This is the 1st commitment commitment for the new 238-tonne increased takeoff weight version with a 7,300-nm range. The A330-200s will feature seating in 3 classes. (KAL) Chairman & (CEO) Yang Ho Cho said the order "is part of our ongoing expansion plan and will enable us to open up new long-haul routes. The latest version of the airplane is an even more attractive option for linking Incheon efficiently and economically with Europe and destinations across the Pacific." (KAL) currently operates 3 A330-200s and 16 A330-300s.
March 2009: Korean Air (KAL), Asiana Airlines (AAR), Singapore Airlines (SIA) and Air Canada (ACN) began rerouting flights that normally pass through North Korean airspace after Pyongyang said it was "compelled to declare that security cannot be guaranteed for South Korean civil airplanes flying through the territorial air of our side." (KAL) and (AAR) began rerouting an estimated 15 daily flights that approach South Korea from the east to new flight paths that take airplanes over Japan, adding an estimated 40 minutes and $2,500 in operational costs to each flight. South Korea's Unification Ministry estimated that 33 flights pass through North Korean airspace daily, 18 of which are operated by non-Korean airlines.
North Korea has allowed commercial flights to pass through its airspace since 1998, after >40 years of prohibiting civil flights. According to JoonAng Daily, South Korean carriers submit flight plans to North Korea for each flight that will pass through its airspace and the nation collects an average of $870 for each. The Unification Ministry said 5,260 flights per year use the route, adding that South Korean carriers annually pay nearly $4 million to Pyongyang for airspace access. North Korea's threat was condemned widely. "The military threat against normal operation of civilian airliners under international aviation protocols is in violation of international norms and is inhumane," South Korea's government said in a statement. "It can never be justified under any circumstance. The South Korean government urges the North to withdraw its military threat as soon as possible." The USA called the threat "a provocation and unacceptable." Tensions are high on the peninsula, with North Korea stating that it plans to conduct missile tests and South Korea and the USA planning to conduct annual military exercises this week that Pyongyang condemns. The USA and South Korea said they plan to carry forward with the exercises that North Korea cited as the reason for its threat against airlines.
April 2009: Korean Air (KAL) will launch daily, Incheon to Shizuoka service on June 4.
May 2009: Hawaiian Airlines (HWI) and Korean Airlines (KAL) will expand their code sharing agreement from June 15 to allow (HWI) to place its code on flights operated by (KAL) between Seoul Incheon (ICN) and Honolulu and between (ICN) and Busan, as well as from (ICN) to destinations in Japan, Malaysia and Thailand. The 2 carriers began a code share relationship in 2007, with (KAL) putting its code on (HWI)'s inter-island and Hawaii to USA mainland flights.
Japan Airlines (JAL) said it will place its code on Korean Air (KAL)'s daily, Incheon to Shizuoka service beginning June 4.
737-8Q8 (37162, HL7785), (ILF) leased and 777-3B5ER (37643, HL-7782), delivery.
June 2009: Uzbekistan Airways (UZB) started all-cargo flights with two A300Fs dry-leased from Korean Air (KAL). The service is based at Navoiy, where the airlines will partner in developing the airport into a logistics hub for central Asia. The freighters will operate to Bangkok, Delhi and Mumbai.
Pratt & Whitney (P&W) and Korean Air (KAL) signed a contract worth approximately $300 million for (PW4170) Advantage 70 engines for six new A330s, plus two spares.
July 2009: Korean Air (KAL) announced that this summer it will add two flight routes to China for nonstop services from Incheon International Airport in Seoul. (KAL) will operate five flights per week between Incheon International Airport, Seoul, and Xi’an, a western city in China by using a 737-800 airplane with 149 passenger seats. Operating every day except Thursdays and Sundays, the flight KE807 will depart Seoul at 9:20 am and will arrive in Xi’an at 11:20 am the same day. The return flight KE808 will depart Xi’an at 12:20 pm and will arrive in Seoul at 4:00 pm the same day.
Another new destination is Mudanjiang, a northeastern city in China. (KAL) will now fly three times per week on Tuesdays, Thursdays and Sundays from June 2, 2009. Also using a 737-800, the outbound flight KE823 will depart Incheon International Airport at 10:00 am and will arrive in Mudanjiang at 11:45 am. The return flight KE824 will depart Mudanjiang for Incheon International Airport at 12:45 am and will arrive at 4:25 pm.
(KAL)’s new services ensure that travelers will be able to reach these regional Chinese cities conveniently. Travelers from the Americas and Europe can check in baggage to their final destination and transit through Incheon International Airport hassle-free. The addition of Xi’an and Mudanjiang to the route network represents that (KAL) is going to serve 30 flight routes to China.
(KAL) Cargo will increase 2x-weekly, Seoul Incheon to Toronto Pearson 747-400F service to 3x-weekly in September.
The South Korean Ministry of Land, Transport & Maritime Affairs said it plans to spend about KRW4 trillion/$3.12 billion to expand Incheon International, enabling it to handle +41% more passengers and +29% more freight by 2015. A second passenger terminal and a new railway line to Seoul will be among the enhancements, according to a statement cited in multiple news reports. Its construction is set to begin in early 2011. Incheon currently has capacity for 44 million passengers and 4.5 million tons of cargo annually.
Canada announced "open skies" agreements with South Korea and New Zealand.
737-8Q8 ((37163, HL7786), (ILF) leased.
September 2009: Hawaiian Airlines (HWI) and Korean Air (KAL) launched an expanded code share arrangement under which (HWI) will place its code on (KAL)'s flights from Incheon to Busan and Honolulu.
(KAL) launched the 2nd phase of its $200 million fleet upgrade and this month will begin installing new seats and an on-demand in-flight entertainment (IFE) system across all classes in its 777s and A330s. Work on 70 airplanes is expected to continue through April 2011. New deliveries will come with the product already installed. By 2014, all 96 of (KAL)'s mid- and long-haul airplanes will feature the upgrades.
(ARINC) said Air China (BEJ), Air Macau (MCU), Asiana Airlines (AAR), Cathay Pacific Airways (CAT), China Southern Airlines (GUN), Dragonair (DRG) and (KAL) signed up to use its AviNet Airport wide-area network service, which is available to carriers using its Muse common-use passenger systems.
(KAL) uses flight crew (FC)-leasing services such as World Airline Services and Rishworth Aviation to acquire its pilots (FC).
October 2009: 777-3B5ER (37136, HL7784), Guggenheim Partners leased.
November 2009: One reason why Japan Airlines (JAL) is losing so much business is because Japanese travelers are flying Korean Air (KAL). Driven by foreign exchange trends, 16% of (KAL)’s passengers now originate in Japan, up from 10% a year ago. By contrast, only 48% now originate in Korea itself, down from 58% in 3rd quarter (Q3) 2008. All told, total transit passengers through its Seoul Incheon base, many of them Japanese, increased +24%. That resulted in a pretty good 4% operating margin for (Q3), compared to a small operating loss last summer. On the other hand, (KAL)’s $229 million net profit was really a -$169m net loss excluding big foreign exchange gains. Interest costs, unfortunately, swelled to $119 million. Compared to last year’s (Q3), revenues fell only -10%. (KAL) was a rare case of an East Asian airline that increased international capacity (ASK)s, while operating expenses fell -15%. That, of course, was driven by fuel, with outlays down -40% despite no change in its consumption volumes. And that drop would have been larger still, had it not been for a weaker local currency (which has incidentally been rising more recently). Foreign exchange volatility, indeed, is proving tremendously influential to (KAL)’s business, not only on its Financial statements but also in its traffic composition. A recovery in East Asian economies may help stabilize things, but it also needs demand to improve in 2 areas where it has outstanding exposure relative to other Asian carriers: cargo markets overall and North America.
(ARINC) renewed its contract with Korean Air (KAL) to continue to provide GLOBALink data and voice communications and AviNet wide-area network service.
Guggenheim Aviation Partners (GUG) took delivery of its 1st 777-300ER, which is slated for lease to (KAL). It is (KAL)'s 1st leasing arrangement with (GUG); the airplane will be its 25th 777.
SEE ATTACHED "KAL-2009-11 GUG 777-300ER."
December 2009: Korean Air (KAL) boosts the 747-8I passenger program with a Memo of Understanding (MOU) for 5 orders worth $1.5 billion at list prices (approximately $800 million purchase price after discounts). (KAL) 's aerospace manufacturing business builds parts of the 747-8's wing structure, including the jet airplane's raked wingtips, its wingtip extensions and the flap track fairing.
SEE ATTACHED "SEATTLE TIMES" AND "AIRLINER WORLD" ARTICLES IN "KAL-2009-12 747-8I ORDER-A."
January 2010: Korean Air (KAL) posted a 2009 net loss of -KRW61.2 billion/-$53.8 million, narrowed considerably from a -KRW1.96 trillion loss in 2008.
(KAL) reported 4th-quarter 2009 net income of +KRW122.3 billion, reversed from a -KRW659.5 billion deficit in the prior-year period and its 3rd straight quarterly profit after 6 consecutive losses stretching from the 2007 4th quarter to the 2009 1st quarter. It did not release full-year 2009 figures, but its annual result is based on quarterly reports throughout the year.
(KAL), which appears to be on the rebound after enduring a severe fiscal downturn, attributed the turnaround to "surging growth of the cargo business and a pickup in the international passenger business." (KAL) is the world's largest cargo carrier among combination airlines (airfreight generates 36.5% of its total revenue) and was hit particularly hard by the precipitous fall in that sector that began in the 2nd half of 2008. Its strong cargo performance in 2009's last 3 months provides further evidence that Asia's economies are rebounding from the recession faster than those in other major regions.
(KAL)'s 4th-quarter revenue was KRW2.58 trillion, which it said "held steady" with its prior-year revenue performance. It noted that "lower fuel prices and a stronger won" led to a -9.9% drop in quarterly expenses to KRW2.42 trillion. Operating income was +KRW154 billion, nearly 7x- greater than a 2008 4th-quarter operating profit of +KRW22.6 billion. 4th-quarter 2009 international passenger traffic increased +11.3% to 13.44 billion (RPK)s on a +6.5% lift in capacity to 18.75 billion (ASK)s.
Cargo revenue rose +22% in the quarter, "becoming the major growth driver in total revenue during the reporting period," (KAL) said. Cargo traffic lifted +15.2% for the three months to 2.41 billion (FTK)s on a +6% increase in capacity to 3.18 billion (ATK)s. "With the turnaround in world cargo demand and the pickup of export volume, (KAL) expects that this business segment will be the growth driver again in 2010 and revenue generated will reach another peak."
March 2010: Korean Airlines (KAL) and Asiana Airlines (AAR) will be subject to fines of KRW10.4 billion/$9.2 million and KRW640 million, respectively, for engaging in anti-competitive practices to hurt smaller Korean carriers, South Korea's Fair Trade Commission (FTC) announced. The announcement came just days after the Australian Competition and Consumer Commission (ACCC) charged (KAL) with air cargo price fixing. The formal penalty notices to the airlines from the (FTC) are still forthcoming, but it issued a statement to media in Seoul detailing antitrust violations by the carriers. According to "JoonAng Daily," the agency charged that (KAL) and (AAR) improperly threatened to withhold peak-season tickets from travel agencies if the firms sold tickets on start-up Low Cost Carriers (LCC)s such as Jeju Air, Hansung Airlines and Yeongnam Air. (KAL), it said, improperly rebated "volume" tickets to travel agencies if (KAL) sales made up >50% of a firm's total sales.
"As a result, low-cost carriers had great difficulty selling tickets for major international routes for Japan, SE Asia and Hawaii and domestic routes to Jeju," the (FTC) stated. "The inability to sell airline tickets through travel agencies caused great difficulty in [the (LCC)s'] operations and made it hard for them to settle into the market. If they fail to safely settle in the market, new companies are likely to collapse."
Meanwhile, (KAL) is facing an April 1 court date in Sydney for allegedly entering "into arrangements or understandings with other international air cargo carriers that had the purpose or effect of fixing the price of a fuel surcharge, a security surcharge and a customs fee that were applied to air cargo" between 2001 and 2006, the (ACCC) said, adding that "the arrangements or understandings were reached in Korea, Indonesia and Hong Kong for surcharges applied to cargo originating in those countries and in Indonesia for a customs fee applied to cargo originating in that country." It said it is "seeking declarations, injunctive relief, pecuniary penalties, and costs." (KAL) is the 12th carrier charged by the (ACCC) for air cargo price fixing.
April 2010: Korean Air (KAL) said it will operate 132 airplanes by year end; it currently has 126 in its fleet.
May 2010: 777-3B5ER (37645, HL8208), delivery. 747-4B5 (26412, HL7465), leased to South Korean government.
June 2010: 777-3B5ER (37646, B-8209), delivery.
August 2010: Korean Air (KAL) added 3x-weekly, nonstop night flights from Hartsfield Atlanta Airport to Seoul Incheon airport (ICN), complementing its daily afternoon service and bringing the number of weekly trips it offers in the market to 10. The new KE Flight 33 departs (ATL) just after midnight on Tuesdays, Thursdays and Saturdays.
Korea’s huge transportation conglomerate, the Hanjin Group that owns Korean Air (KAL), says it is speeding up efforts to create a Central Asia logistics hub for multi-modal freight with the opening of an air cargo terminal at Navoi International Airport in Uzbekistan.
Calling the terminal part of a modern-day "Silk Road," (KAL) President & (COO) Chang Hoon Chi said (KAL) will “spare no effort” to support freight growth at Navoi. To gain pre-occupancy benefits, Hanjin has helped manage the airport for the past 20 months with the government. The Uzbekistan terminal is modeled after (KAL)’s freight center at its home base in Incheon (ICN), Asia’s 2nd-busiest freight hub. The terminal covers 160,382 sq meters (1.7 million sq ft) and is designed to handle 100,000 tons of cargo a year. A 2nd phase anticipates a 500,000-ton capacity.
Construction on the terminal began in December 2008. Hanjin signed a Memo of Understanding (MOU) last May with the Uzbekistan government and Uzbekistan Airways (UZB) to develop an air cargo hub at Navoi Airport and launched 3x-weekly 747-400F (ICN) to Navoi to Milan flights in August. Hanjin announced in late summer it would join the project with the aim of turning Navoi into a multi-modal cargo hub. (KAL) also sees potential passenger opportunities in the country and launched 3x-weekly, 777-200 (ICN) to Tashkent service in September.
“(KAL) will spare no effort in supporting the growth of Navoi into Central Asia’s best logistics hub, expanding global network and practicing aggressive marketing strategies as (KAL) participates in the airport management,” Chi added.
A330-223 (1155, HL8212), delivery.
October 2010: SkyTeam (STM) alliance’s Korean Air (KAL) will soon (in May, to be exact) become airline number 6 to fly the A380. The 1st of 10 units on order will be followed by 3 more from June to August, putting it in the same league with Singapore Airlines (SIA), Qantas (QAN), Emirates (EAD), Air France (AFA)/ (KLM) and Lufthansa (DLH), all respected as quality longhaul premium carriers. (KAL) plans to configure its A380s with just 400 to 450 seats (less than most others) and will use them on routes to the USA (Seoul to Los Angeles will likely be the 1st) and to Europe.
November 2010: Korean Air (KAL) launched daily service to Tokyo Haneda from Seoul Gimpo and Seoul Incheon.
January 2011: SEE ATTACHED "KAL-2011-01-2010 WORLD TOP TRAFFIC."
Korean Air (KAL) reported a 2010 net profit of +KRW468.4 billion/+$418.6 million, reversed from a net loss of -KRW98.9 billion in 2009, marking its 1st profitable year since 2007.
Full-year revenue lifted +22% to KRW11.46 trillion, while expenses heightened +11.7% to KRW10.34 trillion, producing an operating profit of +KRW1.12 trillion, significantly improved over an operating profit of +KRW133.4 billion in 2009. 4th-quarter net income of +KRW69.6 billion was down -18% despite a +12.4% increase in revenue to KRW2.9 trillion. (KAL) noted that 50.5% of revenue generated in the fourth quarter came from international passenger services followed by 33.1% from cargo operations.
4th-quarter international passenger traffic increased +6.5% compared to the prior-year period to 14.32 billion (RPK)s on a +1.6% rise in capacity to 19.05 billion (ASK)s, producing a load factor of 75.1% LF, up +3.4 points. (KAL) noted that quarterly (RPK)s to/from China increased +29% year-over-year. 4th-quarter international passenger yield improved +15.7% to KRW99.7.
4th-quarter domestic passenger traffic increased +7.3% to 665 million (RPK)s on a -4.5% cut in capacity to 1.07 billion (ASK)s, producing a load factor of 62.2% LF, up +3.3 points. Domestic yield was up +2.9% to KRW183.1. 4th-quarter cargo traffic rose +1.7% to 2.45 billion (FTK)s on a +1.8% raising of capacity to 3.24 billion (AFTK)s, leading to a load factor of 75.7% LF, down -0.1 point. Cargo yield heightened +1.1% to KRW360.7.
(KAL) said 40.7% of its 4th-quarter cargo revenue was generated on service to/from North and South America, while 30.8% is attributed to European routes.
(KAL) plans to grow full-year 2011 passenger capacity +7.7% compared to 2010 while airfreight capacity is slated to rise +4.2%.
(KAL) will launch its 1st A380 service in May 2011 with the entire upper deck of the airplane devoted to business class (C) fliers. The configuration is designed to give business (C) fliers “exclusivity like they’re traveling in their own private jet,” according to Senior VP Passenger Business Division, Walter Cho.
Dubbed “prestige class,” the upper deck will have 94 lie-flat sleepers with 74 inch seat pitch and “extra large” seat partitions that offer what Cho says is “normally the comfort and privacy reserved for first-class (F) passengers on other airlines.” The airplanes will have the lowest seat count of any A380 with only 407 seats: 12 first class (F), 94 business class (C) and 301 economy class (Y) seats. Seat pitch in economy (Y) will be almost 36 inches.
(KAL) has ordered 10 A380s with the 1st 5 to be delivered by the end of 2011, and an additional 5 by 2014.
Later, (KAL) released more details of its initial long-haul schedule for the A380, with flights from New York beginning August 2 and Los Angeles October 1. (KAL) previously said its USA flights would begin in August, but is now being more specific about dates and schedules. The A380 will initially fly from New York John F Kennedy International Airport 3x-weekly, and daily from September 1. Los Angeles A380 flights will operate daily immediately.
A spokeswoman for (KAL) says there has been no change to the delivery schedule since its last update in October. (KAL) plans to begin A380 flights on short-haul routes. A380 service will be introduced from Seoul to Tokyo and Hong Kong, starting June 1, and will then be expanded to the Bangkok route in July.
(ARINC) Inc deployed 4 new remote ground stations to enhance coverage of its GLOBALink/VHF data link network for aviation in South Korea. 2 new ground stations were deployed at Cheongju and Yeosu International to begin providing coverage, while 2 auxiliary ground stations were deployed to enhance existing coverage at Gimpo and Incheon International. (ARINC)’s network of 11 GLOBALink/VHF ground stations in South Korea covers most of the country’s major international airports, it said.
1 737-8Q8 (38822, HL8224), 1 A330-223 (1200, HL8227) and 1 A380-861 (039, HL7612), deliveries.
February 2011: Korean Airlines (KAL) uses crew-leasing services such as Total Aviation Services, World Airline Services and Rishworth Aviation for its pilots (FC) recruitment. (KAL) is currently recruiting pilots (FC). Applicants can apply online through each crew leasing firm.
March 2011: Hawaiian Airlines (HWI) and Korean Air (KAL) formed a partnership to allow each carrier’s frequent flier members earn and redeem mileage credits on either carrier. The two airlines operate code share flights, including on Seoul Incheon - Honolulu service, and "plan to continue expanding" the code share relationship, (HWI) said.
(KAL) announced an order for two new 747-8F Freighters. The order value is $639 million at Boeing (TBC) list prices. In December 2009, (KAL) became the first airline to order both the passenger and freighter versions of the 747-8. With this order, (KAL) has five 747-8I Intercontinentals and seven 747-8F Freighters on order. The 747-8F Freighter offers a range of 4,390 nautical miles/8,130 km and a maximum structural payload capacity of 154 tons/140 tonnes. It also offers an additional +4,221 cubic feet/+120 m3 and 16% more revenue cargo volume than the 747-400F Freighter.
(KAL) currently operates a total 27 Boeing freighter airplanes and will become one of two airlines to operate both the 747-8 Freighter and the 777 Freighter.
A (KAL) spokesperson confirmed that (KAL)'s order for 10 787-800s has been converted to an order for 10 787-900s, with deliveries starting in 2016.
May 2011: Korean Air (KAL) took delivery of its first A380. (KAL) is the first Asian carrier to operate a (GP7200)-powered A380.
(KAL), which became the sixth airline to take delivery of the A380, has 10 on order "which should [all] be delivered by 2014," said (KAL) Chairman, Yang Ho Cho. There are currently 20 (GP7200)-powered A380s in service, with 104 on order, according to Engine Alliance. (KAL) is slated to begin operating its A380, which will be the 49th total to enter service, next month. (KAL) will initially operate the airplane from Seoul Incheon to destinations in Asia, first to Tokyo Narita and Bangkok. That will be followed later this year by service to North America (either Los Angeles or New York (JFK)) and Europe (either Paris Charles de Gaulle or Frankfurt).
Typically, A380s seat about 525 passengers in a three-class layout, but (KAL) specified a spacious layout with seating for 407 passengers in three classes. The (KAL) A380 includes special features such as a duty-free showcase area and an upper deck bar and lounge for premium passengers.
(KAL) will take delivery of four more A380s in 2011, one in 2012, two in 2013 and two in 2014.
(KAL) has ordered five A330-200s, which brings (KAL)’s orders for the A330 to 30, of which 23 have already been delivered. The A330s will be powered by Pratt & Whitney (PW4000)s.
June 2011: Korean Air (KAL) has tentatively signed for up to 30 Bombardier CSeries twinjets, the deal for (KAL) giving the program a further lift at the Paris Air Show. (KAL)'s agreement is for 10 CS300 airplanes, with options on another 10 and purchase rights for 10 more.
The airplanes are powered by Pratt & Whitney (PW1000G) geared turbofans. (KAL)'s letter of intent (LOI) is the latest in a string of agreements for the airplane that have helped to ease uncertainty over prospects for the program.
Two 737-9B5ERs (37633, HL8221; 37634, HL8223), and 777-3B5ER (37648, HL8218) deliveries. The 737-9B5ERs were the first to be received with Boeing's Sky Interior and were to be used on the Osaka Kansai and Tokyo Haneda routes later this year.
July 2011: Korean Air (KAL) will operate seasonal, Seoul Incheon - Anchorage charter service between July 26 to August 7.
A 737-900ER and a 777-300ER were delivered to (KAL).
August 2011: Korean Air will operate its first long-haul A380 flight from Seoul Incheon (INC) to New York (JFK), and believes the airplane can help it attract new business passengers. "We hope we can increase our corporate sales with the A380," Managing VP & Head of Passenger Business Division, Keehong Woo told reporters. (KAL) now has two A380s in its fleet; in addition to the newest one, which will be operated on the (ICN) - (JFK) route, it is utilizing one to fly from (ICN) to Tokyo Narita and Hong Kong.
It is slated take delivery of three more A380s this year and will place them in service from (ICN) to Paris Charles de Gaulle, Beijing, and Los Angeles, respectively.
(KAL) has configured the A380 for 407 passengers, the fewest of any of the airlines that have taken delivery of the airplane. It has dedicated the upper deck to 94 business-class (C) seats, an in-flight lounge dubbed the "Celestial Bar" and a "Duty Free Showcase."
Woo noted, "We put all business class (C) in the upper deck. [The upper deck] looks like a business jet. We see that we can make more money [in business class (C)] than in economy (Y). We have more potential to develop business class (C). We think in the big markets, like Los Angeles and New York and big cities in Europe, we can fill up our [A380] business class (C)."
He pointed out that most A380 operators have placed economy (Y) seats in the rear of the upper deck. The main deck of (KAL)'s A380 features 301 economy (Y) seats and 12 first-class (F) suites.
Woo conceded that, in the past, (KAL) has not enjoyed the same reputation for business-class (C) service as some of its rivals. "It takes time [to alter perceptions], but we've changed a lot recently," he said. "We think we are at the level of any other airline, like Cathay [Pacific Airways] (CAT) or Singapore [Airlines] (SIA), in terms of quality of service, quality of product and quality of operations."
(KAL) placed a firm order for two additional 737-900ERs valued at $171.6 million at list prices. Boeing Flight Services said it will partner with (KAL) to provide 737NG training for (KAL) pilots (FC) at (KAL)'s Seoul Incheon flight training facility.
Bombardier said (KAL) converted its Letter of Intent (LOI) for 10 CSeries300 airplanes to firm orders. The (LOI), marking the first CSeries commitment by an Asian airline, was announced in June at the Paris Air Show. The transaction also includes options for 10 CS300s and purchase rights for an additional 10 CS300s. Bombardier has now secured 133 firm CSeries orders.
January 2012: Seoul's Incheon Airport handled 35 million passengers in 2011, +5% from 2010.
Cambridge Communications Limited (CCL) is the largest provider of Flight Crew (FC) for Korean Air (KAL). (CCL) is currently hiring 737NG Captains and First Officers (FC)s, A330 Captains and First Officers, 777 Captains and First Officers, as well as 747 Captains and First Officers. (CCL) is also recruiting Instructor Pilots for the 777, 747 and 767. Applicants can view minimum qualifications, current interview dates and apply online.
Rishworth Aviation is a flight crew (FC) leasing firm recruiting pilots for a large number of client airlines on various airplane types including most Boeing (TBC) and Airbus (EDS) airplanes, ATRs and many more. This month, Rishworth Aviation is recruiting for pilots (FC) for Korean Air - 737NG, A330, 747, 777 Captains and First Officers. Application information and position details are available online at http://www.rishworthaviation.com.
(KAL) also uses other flight crew leasing services such as Total Aviation Services, and World Airline Services to acquire its pilots (FC). (KAL) is actively recruiting pilots (FC) and applicants can apply online through any of the mentioned flight crew leasing firms.
Also, see FltOps.com and FAPA.aero.
February 2012: Seoul Incheon (ICN) Airport is discounting landing fees in an aggressive marketing campaign aimed at attracting new airlines to South Korea’s main international airport. (ICN) is offering a 100% discount on landing fees for new carriers in their first year of operation at the airport, followed by 75% off in the second year and a 50% reduction in year three.
(ICN) executive VP, Young-Geun Lee said that the airport generated $1.1 billion in revenue in 2011. He said that 65% of the airport’s business comes from “non-aviation [sources] like duty-free sales.”
(ICN) opened in 2001 and operates 410,000 flights annually, slated to grow to 530,000 by 2020. Some 70 airlines serve 176 cities from (ICN). “Within three flight hours, we have 61 cities with populations over one million people,” Lee said.
The new T2 terminal is under construction and should be in service in 2017, adding an additional capacity of 18 million passengers at a cost of $4 billion, Lee said. After T2 opens, the next expansion phase will include constructing a fourth and fifth runway.
(ICN) handled about 35 million passengers and 2.5 million tons of cargo in its six cargo terminals last year. It is the world’s second largest international cargo airport after Hong Kong. Lee said that 50% of (ICN)’s cargo volume is in transit. Some 36 wide body freighter parking stands are available. By 2020, 7 million tons of cargo should pass through (ICN), according to Lee.
Vladivostok Airport (VVO) in the Russian Far East will gain "open skies" status in June, Moscow Sheremetyevo Airport (SVO) (CEO), Mikhail Vasilenko said. This will enable new carriers to pick up and drop off passengers and cargo without bilateral agreements. (SVO), which owns a 52.1% share in (VVO), is one of the investors in the $190 million terminal and aerodrome infrastructure renovation set to open in March. The terminal, which will initially accommodate 3.5 million passengers, was revamped for the Asia/Pacific Economic Cooperation (APEC) Summit, taking place September. In the future, terminal capacity could reach 5 million passengers.
According to market experts, the open skies agreement will attract new carriers and more passengers, enabling (VVO) to get a return on its investment. Vasilenko said Korean Air (KAL) and S7 Airlines (SBR) will also launch flights from (VVO) and Khabarovsk to Tokyo. In 2011, (VVO) handled 1.46 million passengers, which Vasilenko expects will increase to 1.85 million in 2012.
Pratt & Whitney (P&W) has won a $200 million order to provide Korean Air (KAL) with 10 (PW4170) Advantage70 engines to power five new A330s.
The Advantage70 is offered both as a new engine and as an upgrade kit for existing (PW4168) engines. It delivers a +2% thrust increase and more than >-1% reduction in fuel consumption.
Korean Air (KAL) celebrated delivery of (KAL)’s first 747-8HTF (37132, HL7609 - - SEE PHOTO - "KAL-747-8HTF - 2012-02") and 777-FB5 (37639, HL8251 - - SEE PHOTO - - "KAL-777-FB5 - 2012-02") Freighters. With the milestone delivery, (KAL) becomes the first airline in the world to operate both the 747-8F and 777F Freighters.
"We are very proud to become the first airline in the world to have the combined strengths of these two freighters in its fleet,” said Yang Ho Cho, Chairman of (KAL). “Our cargo fleet is being improved by these fuel-saving planes. They can help reduce carbon emissions by -17% and this supports our goal to be a responsible citizen of the world.”
Korea’s flagship carrier is the first Boeing (TBC) customer to order both variations of the new 747-8 airplane and is also a key supplier partner on this new airplane program.
The 747-8F Freighter offers a range of 4,390 nautical miles/8,130 km and a maximum structural payload capacity of 148 tons/134 tonnes, while offering an additional 4,221 cubic feet/120 m3 and +16% more revenue cargo volume than the 747-400F Freighter.
The twin-engine 777F Freighter is the most fuel-efficient airplane with leading economic and environmental performance in its category. It has a cargo capacity of 103 metric tons/113 tons with a range of 9,038 kilometers/4,880 nautical miles.
Korean Air (KAL) plans to operate the 747-8HTF Freighter on its transpacific route, with stops in Osaka and Narita, Japan, Los Angeles, and San Francisco. The 777-FB5 Freighter is (KAL)’s first twin-engine freighter and will allow the airline to open into new markets in Europe, including Vienna, Frankfurt, and London.
March 2012: Virgin America (VUS) and Korean Air (KAL) have announced an interline agreement for travel on both carrier networks across North American, Asian and South American routes. From Seoul Incheon, (KAL) passengers will be able to connect at Los Angeles International Airport (LAX), San Francisco International Airport (SFO), Seattle-Tacoma International Airport (SEA) and Las Vegas McCarran International Airport (LAS) to several other Virgin America (VUS) destinations.
May 2012: Korean Air (KAL) launched its second London route from Seoul Incheon to Gatwick. (KAL) will launch 3X-weekly, Seoul Incheon - Nairobi service on June 21.
Under a revision to its route strategy designed to counter the impact of the economic downturn, (KAL) is to switch long-haul airplanes from destinations in the West to short-haul destinations in Asia.
The SkyTeam (STM) Alliance carrier says that the change in approach is a temporary measure during the financial crisis to improve cost efficiency and optimiZe capacity. Earlier this month, (KAL) reported a first-quarter 2012 net loss of won (W) -67 billion/-$58.8 million, down from a net profit of +W271 billion a year before, which it says resulted from a surge in fuel costs.
"We try to keep a balance between long-haul and short-haul, but with this unstable economic situation we need more short-haul flights," says (KAL)'s VP Long-Haul Network, Sang-Beom Lee. He added that under this strategic change during the downturn, some long-haul destinations have seen or will see reductions in frequency, capacity or both.
(KAL) has either moved, or will move, large-capacity airplanes such as its 747-400s from long-haul routes to destinations such as Atlanta, Seattle, Sydney, Toronto, Vancouver, and Vienna. On these routes it will either reduce frequencies or use more fuel-efficient, smaller-capacity airplanes such as its Boeing 777 variants, while (KAL)'s 747-400s will be used to serve short-haul destinations such as Beijing, Osaka, Shanghai and Tokyo. The 777 is also being used on (KAL)'s new route from Seoul Incheon International airport to London Gatwick, which opened in April.
Explaining the surge in demand which necessitated the changes, Sunghoi Song, VP Passenger Sales, said: "Recently, the Japanese are coming a lot to Korea. Before last year's earthquake they flew long-haul flights to the USA or Sydney, but now they are inclined to travel shorter distances."
Korea is also a favorite destination for visitors from China, with visitor numbers last year increasing by +18.4% to more than >2.2 million, according to figures from the Korea Tourism Organization. In addition, Song says: "Koreans have a tendency to travel on shorter flights than on long-haul."
(KAL) is also using one of its five A380s to fly between Seoul and Hong Kong. Lee says that this allows the airplane to be fully utilized after it returns to Korea from Frankfurt, since it began services towards the end of March.
Lee explains that Hong Kong was chosen as a destination for the A380 because high levels of business traffic on the route, suit (KAL)'s A380s, which feature an all business (C)-class configuration upper deck. He adds: "We also had to choose a short-haul destination that was A380 ready - and some airports in Japan and China were not."
(KAL) which will take delivery of the sixth A380 out of the 10 it has on order, says it was considering using the airplane on a route to USA SkyTeam (STM) alliance partner, Delta (DAL)'s Atlanta hub, as well as to Paris for several months in the autumn. Lee says London is being considered as a destination for the A380, including during the Olympics, but says this it is probable that (KAL)'s sixth delivery of the type will be used to fly to Atlanta, to take advantage of the recently opened $1.4 billion Maynard H Jackson Jr International Terminal.
Looking several years into the future, Lee says (KAL) is likely to use the 20 Boeing 787-9s it has on order to develop new markets in Central and South America, as well as secondary cities in North America and perhaps Kenya, where the market is not big enough for a larger airplane.
Russia and Republic of Korea have agreed to remove restrictions on flights between Korean cities and Vladivostok International Airport (VVO). In a memorandum of understanding, the two countries said they would not limit the number of designated airlines and frequency entitlements of both sides.
(VVO) in the Russian Far East will gain "open skies" status in June. Industry experts say the new rules will attract new carriers and more passengers, enabling (VVO) to get a return on its investment. In 2011, the airport handled 1.46 million passengers and this year it expects to handle 1.85 million passengers.
The two sides also discussed the exchange of fifth freedom rights for Russian airlines on Republic of Korea and North America routes and increasing overfly rights on trans-Siberian routes, but deferred a decision until the next round of negotiations.
June 2012: Korean Air (KAL) as a privately owned flag carrier serves 101 cities in 37 countries, together with a dense domestic network linking 14 cities. The airline is also one of the world's leading cargo carriers serving nearly 50 destinations in 25 countries, and operates a full-scale aerospace division, supplying airplane parts to Airbus (EDS), Boeing (TBC), and the USA Air Force (USF).
Employees = 14,700.
(IATA) Code: KE - 180. (ICAO) Code: KAL - (Callsign - KOREANAIR).
Parent organization/shareholders: Others (61.14%); Yang-Ho Cho and family (12.13%); Hanjin (7.82%); Korean Air (KAL) employees (6.22%); National Pension Corporation (3.44%); Kokusai Kogyo (3.21%); Inha University Foundation (2.71%); Jungseok Foundation (1.96%); Hana Bank (1.15%); Oriental Fire & Marine Insurance (0.87%); & Korea Research Foundation for 21C (0.33%).
Airline subsidiaries/shareholdings: Grand Star Cargo International (25%).
Alliances: SkyTeam (STM) Alliance.
Main Base: Seoul Incheon International airport (ICN), and Seoul Kimpo International airport (GMP).
Hubs: Pusan Kimhae International airport (PUS); and Cheju International airport (CJU).
Domestic, scheduled destinations: Busan (PUS); Cheongiu/Daejeon (CJJ); Daegu (TAE); Gunsan (KUV); Gwangju (KWJ); Cheju/Jeju (CJU); Jinju/Sacheon (HIN); Pohang (KPO); Seoul/Gimpo (GMP); Seoul/Incheon (ICN); Ulsan (USN); Wonju/Hoengseong (WJU); Yangyang (YNY); & Yeosu/Suncheon (RSU).
International, scheduled destinations:
Americas: Atlanta, GA (ATL); Chicago O'Hare, IL (ORD); Dallas Fort Worth, TX (DFW); Honolulu, HI (HNL); Las Vegas, NV (LAS); Los Angeles, CA (LAX); New York John F Kennedy, NY (JFK); San Francisco, CA (SFO); Sao Paulo Guarulhos (GRU); Seattle, WA (SEA); Toronto Pearson (YYZ); Vancouver (YVR); & Washington DC Dulles, DC (IAD).
China/Mongolia: Beijing Capital (PEK); Changsha (CSX); Dalian (DLC); Guangzhou (CAN); Hong Kong (HKG); Jinan (TNA); Kunming (KMG); Qingdao (TAO); Sanya (SYX); Shanghai Hongqiao (SHA); Shanghai Pudong (PVG); Shenyang (SHE); Shenzhen (SZX); Tianjin (TSN); Ulaanbaatar (ULN); Urumqi (URC); Weihai (WEH); Wuhan (WUH); Xi'an Xianyang (XIY); Xiamen (XMN); Yanji (YNJ); Yantai (YNT); & Zhengzhou (CGO).
Europe/Middle East/Africa: Amsterdam (AMS); Cairo (CAI); Dubai (DXB); Frankfurt (FRA); Istanbul (IST); London Heathrow (LHR); Madrid (MAD); Moscow Sheremetyevo (SVO); Munich (MUC); Paris Charles de Gaulle (CDG); Prague (PRG); Rome Leonardo da Vinci (FCO); St Petersburg (LED); Vienna (VIE); Vladivostok (VVO); & Zurich (ZRH).
Japan: Akita (AXT); Aomori (AOJ); Fukuoka (FUK); Hakodate (HKD); Kagoshima (KOJ); Komatsu (KMQ); Nagasaki (NGS); Nagoya (NGO); Niigata (KIJ); Oita (OIT); Okayama (OKJ); Osaka Kansai (KIX); Sapporo Chitose (CTS); Tokyo Haneda (HND); & Tokyo Narita (NRT). Oceania: Auckland (AKL); Brisbane (BNE); Melbourne (MEL); Nadi (NAN) - Fiji; & Sydney (SYD).
Southeast Asia/India: Bangkok (BKK); Cebu (CEB); Chiang Mai (CNX); Denpasar Bali (DPS); Hanoi (HAN); Ho Chi Minh City (SGN); Jakarta Soekarno Hatta (CGK); Kathmandu (KTM); Kota Kinabalu (BKI); Kuala Lumpur (KUL); Manila (MNL); Mumbai (BOM); Phnom Penh (PNH); Phuket (HKT); Siem Reap (REP); Singapore (SIN); & Taipei (TPE).
Boeing (TBC) delivered the first new 737-800 NextGen to Air Lease Corporation (ALE) to be operated by Korean Air (KAL) from an order placed during the 2010 Farnborough Airshow.
July 2012: Korean Air (KAL) incurred a -KRW159 billion/-$140 million net loss in the second quarter, reversed from a +KRW21 billion net profit in the year-ago period. Steep foreign exchanges losses and interest expenses helped push (KAL) into the red for the three months ended June 30.
(KAL) did boost second-quarter revenue +11.1% year-over-year to KRW3.27 trillion, while expenses rose +6% to KRW3.14 trillion, producing an operating profit of +KRW129 billion. That was turned around from an operating deficit of -KRW20 billion in the 2011 June quarter, when favorable foreign exchange gains helped (KAL) earn a net profit.
(KAL) said that “Olympic and seasonal demand” in the current quarter may lead to a “gradual” third-quarter recovery. “With stabilized jet fuel prices and exchange rates, (KAL) is expected to see improvement in profitability.”
(KAL) ended the first half with 122 passenger airplanes and 26 freighters in its fleet. It plans to take delivery of one A380, one 737NG and one 747F during the second half of the year.
(KAL) has decided to order two 777-300ERs, valued at $596 million at list prices. A (KAL) spokesman said the airplanes are scheduled for delivery by 2014 and will be deployed on long-haul routes.
(KAL) operates 34 777s, including 10 777-300ERs. With this order, (KAL) has six more 777-300ERs on order.
August 2012: Korean Air (KAL) will launch 4X-weekly, Seoul Incheon - Yangon service on September 13.
Korean Air (KAL) has announced that it has submitted a bid for a 42% stake in airplane manufacturer, Korea Aerospace Industries (KAI) currently put up for sale by government owned Korea Finance Corporation. (KAI) builds its own military airplanes and fighter jets but also is a parts supplier to Airbus Industrie (EDS), Boeing (TBC), Bombardier (BMB) and Embraer (EMB).
Later, Korean Air’s (KE) attempt to buy a stake in Korean Aerospace Industries failed, putting its plans to expand its aerospace business in jeopardy. The stake was valued at KRW1.05 trillion/$926 million.
Korea Finance Corporation, which is overseeing the sale, said (KAL) was the only bidder by closing time. Rules dictate there must be two competing bids. Shareholders will decide whether to hold a second round of bidding after further discussions, "Bloomberg" reported.
(KAL) is keeping its options open to expand into the aerospace sector.
“Currently we are watching the market situation,” the spokesperson said. “Once Korea Aerospace Industries posts a second notice for a bidder, we will consider our position.”
October 2012: Korean Air (KAL) seems to be planning to retire its remaining five A300-600s currently used on domestic and regional routes by the end of January 2013. The airplanes are currently based at Seoul Gimpo (GMP) and used on the largest domestic market from there to Jeju International (CJU), between Jeju and Daegu International (TAE) as well as on international services between Gimpo and Osaka Kansai International (KIX) airports. From the start of the (IATA) winter timetable period from October 28, only two daily services between Gimpo and Osaka Kansai remain in Korean's A300-600R schedule with the last flights currently scheduled to operate on January 31, 2013.
November 2012: Korean Air (KAL) returned to Saudi Arabia on 9 November, as the SkyTeam (STM) Alliance carrier relaunched its route from Seoul Incheon (ICN) to Jeddah (JED) via Riyadh (RUH) after 15 years. Flights on the 8,400 km route will depart with thrice-weekly frequencies and be operated using A330-200s. Ha Man-kee, (KAL)’s Manager Saudi Arabia, said: “We resumed our flights to Saudi Arabia as demand from the construction, housing and power plant markets is growing. More and more Korean construction companies are winning contracts in the country; we therefore expect an increase in the number of passengers.”
January 2013: Korean Air (KAL) said it will introduce nine additional next-generation airplanes to its fleet this year. The airplanes will comprise two A380s, one A330-200, two 777-300ERs, two 737-900ERs, one 747-8F, and one 777F.
(KAL) will take delivery of two A380s in July and October, bringing the number of airplanes to seven out of an order for 10 of the type. The A380s will be mostly used on long-haul flights, including New York and Los Angeles, California.
This month, (KAL) has doubled the A380 frequency between Incheon and New York from seven to 14X a week. It has increased A380 service between Incheon and Los Angeles from seven to 12X weekly.
On February 1, (KAL) will resume the A380 Incheon - Frankfurt service and will begin its A380 Incheon - Atlanta service in August.
(KAL) introduced 30 airplanes during 2011 and 2012; 16 in 2011 and 14 last year. (KAL) plans to take delivery of 53 airplanes (including five 747-8Is, 10 787-9s and 10 Bombardier CS300s) by 2018. It has 148 airplanes in its fleet and plans to have 200 by 2019.
Korean Air ((IATA) Code: KE, based at Seoul Incheon International airport (ICN)) (KAL) plans to launch daily A330-300 service from Seoul Incheon International (ICN) via Tokyo Narita New Tokyo International (NRT) to Honolulu International (HNL) airport on March 31 replacing its current daily A330-200 service from Seoul Incheon International (ICN) via Narita to Los Angeles International (LAX). (KAL) already offers two daily non-stop services between Seoul Incheon and Honolulu with A330-300s and B747-400s and will continue to serve Los Angeles non-stop with three daily services with a mix of A380-800s, 747-400s and 777-300ERs.
February 2013: Korean Air (KAL) has confirmed that it is currently in the process of conducting due diligence on Skyteam (STM) Alliance partner, (CSA) Czech Airlines ((IATA) Code: OK, based at Prague Ruzyne (PRG)). It is one of several parties reportedly interested in taking a 44% minority stake in (CSA) currently up for sale. The two carriers already closely cooperate on the route between Prague and Seoul Incheon International (ICN) currently served by (KAL) four times weekly with (CSA) planning to launch twice weekly service on the route as well from June 1.
March 2013: Korean Air (KAL) inaugurated flights on the route from Seoul Incheon (ICN) to Malé (MLE) on 9 March. Thrice-weekly services are offered on the route and will be carried out with a stopover in Colombo (CMB) in Sri Lanka. (KAL) uses its A330-300s to operate the flights. Competition on the route comes from Mega Maldives Air (MEG), which provides weekly departures on its non-stop service from Malé to Seoul Incheon.
Korean Air (KAL) has submitted a bid to take a 44% stake in (CSA) Czech Airlines, according to multiple reports from Seoul and Prague. (CSA) is owned by several Czech Republic government institutions, but the government has indicated it wants to partially or fully privatize the loss-making carrier. Korean Air (KAL) had been considering making a bid and confirmed to several news outlets that it officially made a multi-million dollar bid.
Czech media reported that Korean Air (KAL) is the only bidder. Qatar Airways (QTA) had also contemplated bidding for a stake in Czech Airlines, but has reportedly declined to do so. Both Korean Air (KAL) and (CSA) Czech Airlines are members of the SkyTeam (STM) Alliance.
March 2013: Korean Air (KAL) added daily from 5X-weekly Seoul Incheon - Seattle, - Dallas, - Toronto for summer season March 31 - October 26. Seoul - Las Vegas will be 4X-weekly, up from 3X.
Korean Air (KAL) is expected to acquire 44% in SkyTeam (STM) Alliance partner, (CSA) Czech Airlines. According to several media reports, the contract should be signed April 9.
No official statements are available on whether (KAL) will pay the reported €2.64 million/$3.4 million for (CSA) and if there is a guarantee to retain employees and not re-sell (CSA) after five-years.
The financially troubled Czech flag carrier has been looking for a potential investor for many years. In December 2012, Qatar Airways (QTA) said it was also considering taking part in the privatization of (CSA). In 2009, the government was unsuccessful in its attempts to privatize the carrier following heavy losses from a failed expansion plan.
(CSA) plans to operate a leased A330-200 this summer from Prague to Seoul Incheon. (KAL) operates 4X-weekly flights on the same route, which could give Prague a more important role as a hub.
South Korea had a record 91.8 million passengers in 2012 which was mainly driven by its international growth. The world’s 15th largest economy in terms of Gross Domestic Product (GDP) and 12th by purchasing power parity, South Korea is home to 50 million people who like to describe their home country’s economic success as “Miracle on the Han River.” But there’s no miracle here: rapid export-fuelled growth first transformed the country into one of the world’s most industrialized, and more recently, helped it weather the global crisis untouched. In fact, South Korea was one of the few developed countries to avoid recession altogether, and is now named as one of the emerging markets in the (MIST) group of countries, along with Mexico, Indonesia and Turkey.
Traffic was up 4.9% in 2012, with Seoul Incheon top for growth. Strong economic performance and the country’s high exposure to international trade have long been the driving forces in the development of South Korean commercial aviation. Average annual growth of +4% over the last decade included strong post-credit crunch traffic development (+15.6% in 2010, +5.2% in 2011, and +7.5% in 2012) and led to the all-time best annual result of 91.8 million passengers last year.
South Korea’s largest airport (at 40% of 2012 traffic), Seoul Incheon, handled 39 million passengers in 2012, achieving an annual rate of growth of +11%, which made it the fastest-growing of the country’s main airports. Notably, Seoul Incheon handles prevailingly international traffic, while the capital’s second facility, Gimpo, commands most of domestic movements in Seoul.
Whereas domestic traffic has been stagnant, international traffic grew by +12% in 2012. South Korea is widely known for its highly advanced rail transportation system, including two high-speed lines operated within the (KTX) project, which has had a negative influence on the country’s domestic air market. A total of 43.8 million people travelled on domestic services in South Korea in 2012, which constitutes a meager +1.1% increase compared to a decade ago: in 2003, 43.3 million flew domestically. In 2012, South Korea’s domestic market grew by a modest +3%.
Contrasting with the domestic market is the international segment, which has more than doubled in size over the last decade, falling short of 48 million by just 40,000 passengers in 2012. Unlike domestic traffic, which suffered more from the (SARS) epidemic, the international market to some extent felt the impact of global downturn with passenger figures falling by up to -5.2% annually in 2008 and 2009. However, the trend was soon reversed, and 2010 saw a staggering growth of +19.5%. While results of similar order might seem difficult to sustain long-term, international traffic to and from South Korea was up almost +12% again in 2012.
China, Japan and the USA are biggest international markets. Analysis of (OAG) Schedules iNet capacity data for April 2013 shows that more than a half of international frequencies are allocated to the two biggest international markets from South Korea (China (29.4%) and Japan (24.4%)). Compared to the same period last year, the Chinese market is the more dynamic one of the two, with seat capacity up +8.9% (vs. +2.2% for Japanese routes).
At a third of the size of the market to China in terms of seats offered in April 2013, the United Sates constitutes the third-largest country market from South Korea. Korean Airlines (KAL) and Asiana Airlines (AAR) serve 13 and nine USA routes, respectively, compared to one each by Delta Air Lines (DAL) and United Airlines (UAL). Germany, which accounts for around 1% of international capacity from South Korea, is the only European country to make it into the top 12 list, while the market from South Korea to the UK, is only the 16th busiest in terms of weekly seats.
The introduction of Samsung Electronics Company's Galaxy S4 smartphone has one clear winner - - (KAL). SEE ATTACHED - - "KAL-2013-03-SAMSUNG S4 SMARTPHONE."
Samsung Electronics may ship about 44 million of the smartphones in the second and third quarters, according to Young Park, an analyst at Woori Investment & Securities Company in Seoul. A 747-8F freighter plane carrying nothing else can hold about 1 million phones.
Moving high-value goods such as a smartphone by air quickly to various markets is important for Samsung to capture market share, when the product has maximum demand. The introduction will likely reverse a two-year decline in freight sales at (KAL), the world’s second-biggest international cargo airline.
“The Galaxy can provide (KAL) with the relief it needs during these difficult times,” said Joo Hae Mee, an analyst at (LIG) Investment & Securities Company with a buy rating on the airline. “While the introduction of one product isn’t enough to make a full recovery, given the dire situation of the cargo industry worldwide, this is positive.”
The global air-freight market shrank -1.5% in 2012 for a second consecutive year and airlines were filling less than half of their cargo planes, according to the International Air Transport Association (IATA). Hurt by the economic slowdown, cargo carriers such as Cathay Pacific Airways (CAT) have turned to high-value items like diamonds because moving low-technology goods is adding little to profits.
Mobile phones are one of the top three products that are moved by air in South Korea, home to Samsung and LG Electronics Inc. Airlines haul about $5 trillion annually of total cargo, accounting for a third of the global trade in terms of value, according to (IATA).
Sending phones by ship on long distances, although cheaper per unit, can be uneconomical because of the high value of inventory in transit at sea. Still, sometimes the sea route is preferred when urgency isn’t at stake. Samsung, which unveiled the Galaxy S4 in New York this month, will first sell the phone initially in three countries by the end of April and reach 155 nations by early May, said Chenny Kim, a company spokeswoman. The phones will be made at factories in South Korea, China, and Vietnam.
Samsung aims to take market share in the $358 billion market from Apple (AAPL)’s iPhone 5, which was introduced last year. Apple’s sales growth last quarter (AAPL) was the slowest in more than two years.
Shares of Korean Air (KAL), which counts Samsung as its biggest customer, dropped -0.2% to 42,150 won in Seoul trading. Samsung fell -2.6% to 1,480,000 won, while the benchmark Kospi Index declined -0.8%.
(KAL) expects the shipment of Samsung’s new Galaxy phone will help increase cargo demand in South Korea, China and other Asian countries, said Kim Jong Cheol, Managing VP of (KAL)’s cargo sales and marketing division.
Volumes are expected to start picking up from early next month for the smartphone as well as materials that goes into making it, Kim said. “The impact of Galaxy S4’s shipment won’t be just short- term and limited to South Korea, because it could also prompt competitors likes Apple, LG and Nokia to push for early release of their products,” Kim said. “There’s a high possibility that this could have positive effect on air cargo demand originating from Asia, including China, within the second quarter.”
(KAL) gets 1.6% of its revenue from Samsung, according to data compiled by "Bloomberg."
(KAL) plans to add one 777F and 747-8F freighters this year, keeping its fleet unchanged at 27. It currently has 23 747s, two 747-8s and two 777s cargo planes.
The nation’s biggest airline posted a profit of 259.6 billion won last year, helped by higher passenger numbers. This year, the company expects cargo traffic to increase +2.1%, while reducing capacity by -1.2%. (KAL) plans to fill 79.1% of its cargo planes, according to its February 1 earnings statement. “(KAL) will benefit most from the rise of Samsung,” said Michael Lee, a Taipei-based analyst with Primasia Securities Company Ltd. “This is a silver lining for (KAL).”
(KAL) has taken delivery of the first 777 built at Boeing (TBC)'s increased production rate of 8.3 per month, or 100 airplanes per year.
April 2013: Korean Air (KAL) started 3X-weekly to Malé - Colombo - Seoul service.
May 2013: Korean Air (KAL) launched daily, Dallas/Fort Worth - Seoul 777 service from 5X-weekly. (KAL) intends to introduce A380 flights to Atlanta in August. (KAL) has a close antitrust-immune relationship with Delta Airlines (DAL), although this did not evolve into a revenue or cost-sharing joint venture. (KAL)'s present Seoul Incheon - Atlanta route is flown with its 777s and is (KAL)'s busiest route by capacity (ASK)s.
Korean Air (KAL) has appointed Jason Kim as UK & Ireland Regional Manager, taking over from James Park, who has returned to (KAL)’s head office in Seoul, Korea. Kim, who is based at the company’s offices in London Piccadilly, has been with (KAL) since 1996 and was previously General Manager for Australia, based in Melbourne. Kim is also former Deputy General Manager from February 2008. He will now be responsible for managing the airline’s UK operations.
Air Lease Corporation (ALE) announced long-term lease agreements with Korean Air (KAL) for two new 777-300ER airplanes, which are scheduled for delivery in November 2014 and May 2015.
The 777-300ERs will be used to support (KAL)’s long-haul, twin-aisle fleet growth. “These two 777-300ERs add to the two new 737-800s already leased by (ALE) to (KAL),” Air Lease Corporation President & (COO), John Plueger said.
(KAL)'s current A380 routes are: Frankfurt, Hong Kong, Los Angeles, and New York (JFK).
June 2013: At the Paris Air Show, Korean Air agreed to purchase 5 747-8 Intercontinental airplanes and 6 777-300ERs, in an order valued at approximately $3.6 billion at current list prices. (GE) Aviation (GEC) said (KAL) has committed to buy 5 (GEnx-2B) powered 747-8Is and 6 (GE90-115B)-powered 777-300ERs. The list price of the engines is valued at more than >$800 million.
(KAL) is the only airline in the world to order both the passenger and freighter versions of the 747-8. SEE ATTACHED - - "KAL-2013-06 - 747-8I 777-300ER ORDER."
737-9B5ER (42174, HL7273) and 777-3B5ER (67651, 8275), deliveries.
July 2013: Korean Air (KAL) expanded its coverage of the Chinese market from Busan (PUS), South Korea’s second-largest city, on July 12th. In addition to Beijing (10 weekly flights), Shanghai Pudong (9) and Qingdao (7), (KAL) now offers four-weekly frequencies on the 1,000 km route to Nanjing (NKG) in eastern China. 737-900s are deployed to fly the new service.
Etihad Airways (EHD) and Korean Air (KAL) have signed a code share agreement, subject to regulatory approval, offering KE codes on (EHD)’s daily services between Seoul and Abu Dhabi. Members of (EHD)’s Guest and Korean Air (KAL)’s SKYPASS loyalty programs will enjoy full benefits in lounge programs including access, priority check-in and excess baggage allowances for top tier program members, earning frequent flyer points on both airlines flights. This agreement will bring to 46 the number of code shares with which (EHD) will be participating.
(KAL) plans to expand its partnership with (EHD) to other destinations in the Middle East and Africa, but has not specified a timeline.
August 2013: According to FAPA.aero, Korean Air (KAL) recruits flight crew (FC) through flight crew leasing companies such as wholly-owned Total Aviation Service and others. (KAL) did send pilot (FC) recruiters to the FAPA.aero Pilot Job Fair in Miami last January.
September 2013: Korean Air (KAL) began A380 3X-weekly, Seoul - Atlanta service on September 1, increasing to daily in October.
Seoul’s Incheon International airport held a groundbreaking ceremony on September 26 to mark the start of construction of its second terminal. The new terminal is part of a won (W) 4.9 trillion/$4.55 billion third-phase wave of construction work, that also includes building a new network of roads and a second transportation center for the airport.
Incheon airport says that the additional terminal will help to raise capacity at the airport from 44 million passengers to 62 million, when it opens in 2017. At that point, it is expected that the existing terminal and aprons will have reached their saturation point.
Last year the airport handled 39 million passengers, an increase of +11%, while total airplane movements increased by +10% to 257,000.
October 2013: Korean Air (KAL) has finalized an order for five Boeing 747-8Is and six 777-300ERs that was announced as a commitment during the Paris Air Show in June. In addition, (KAL) will order one more 787. The combined order is worth $3.9 billion at current list prices. SEE ATTACHED - - "KAL-2013-10 - BOEING ORDERS."
The five 787-8Is will be powered by the (GEnx-2B) engine and the six 777-300ERs will be powered by the (GE90-115B) engine.
With this order (KAL) expands its backlog of 747-8Is and 777-300ERs to 10 each. The order also increases (KAL)’s 787 backlog to 11.
A380-861 (128, HL7622), ex-(F-WWAB), delivery.
December 2013: Czech leisure carrier, Travel Service (TVS) will acquire 34% of (CSA) Czech Airlines from Korean Air (KAL), prompting the departure of Czech Airlines Chairman & President, Philippe Moreels.
Korean Air (KAL) acquired 44% of (CSA) Czech Airlines from Czech Aeroholding in April 2013 and is now planning to buy a further 34%. It will then sell the shares to Travel Service (TVS) to reinforce its European operations. “Working together with Travel Service (TVS), the company wishes to make Vaclav Havel Airport Prague its European hub. The entry of Travel Service (TVS) into (CSA) will provide Korean Air (KAL) with connections to approximately 40 new destinations in Europe to which their passengers will be able to fly after their transfer at Vaclav Havel Airport Prague,” Czech Aeroholding said.
Following the deal, which remains subject to competition clearances, Korean Air (KAL) will continue to hold a 44% stake, followed by Travel Service (TVS) (34%), Czech Aeroholding (19.74%) and Ceska Pojistovna (2.26%). “In this new phase, (CSA) is going to need some new blood and a change in its management style. Therefore, it is logical that all the shareholders will agree on a new company President after the transaction has been completed,” Moreels said, announcing his plan to resign after the deal is cleared.
(CSA) Czech Airlines has been through an intensive four-year restructuring, including two years under Moreels’ leadership.
February 2014: Korean Air (KAL) has posted a net loss for 2013 of -KRW385 billion/-$362.1 million, a year-over-year drop of KRW641 billion from 2012. Full-year revenue fell -4% year-over-year to KRW11.85 trillion. Operating expenses also fell (-2%) to KRW11.87 trillion, resulting in an operating deficit of -KRW18 billion for the year, reversing the company’s operating profit of +KRW229 billion reported for 2012.
The South Korean flag carrier is reporting a fourth-quarter 2013 net loss of -KRW58 billion, a difference of KRW198 million from fourth-quarter net profits in 2012. Fourth-quarter operating revenue slipped -0.3% year-over-year to KRW2.98 trillion; operating expenses were down -1.9% to KRW2.96 trillion, producing an operating profit of +KRW20 billion, reversing an operating loss of -KRW30 billion reported in the fourth quarter of 2012.
Korean Air (KAL)’s full-year international traffic fell -0.4% to 65.9 billion (RPK)s; capacity grew +1.3% to 85.6 billion (ASK)s, producing a load factor of 77% LF, down -1.3 points year-over-year. Yield for (KAL)’s international passengers fell -2.1% year-over-year to $0.093. Cargo demand fell -5.7% year-over-year to 7.8 billion (FTK)s; cargo capacity decreased -6.4% to 10.1 billion (AFTK)s, resulting in a cargo load factor of 77% LF for 2013, a +0.6 point increase year-over-year.
In its fourth-quarter results and 2014 business plan statement, the company said it intends to “increase [passenger] profit by strengthening high class sales and expanding charter flights to new destinations.” The company is targeting an operating profit of +KRW640 billion for 2014.
For cargo, the company expects “to secure new sources of income by developing niche markets for passenger airplane cargo and transporting medicine, medical supplies, agro-fisheries products and direct overseas purchase products.”
Korean Air (KAL) closed out 2013 with a fleet of 121 passenger airplanes and 26 cargo airplanes. Three Airbus A330s, two A380s, one Boeing 747-8F and one 777F are due for delivery in 2014.
In October, (KAL) finalized a previously announced order for five Boeing 747-8Is and six 777-300ERs and added an additional 787 to the order. The combined order is worth $3.9 billion at current list prices.
March 2014: Korean Air (KAL) has deployed its Airbus A380 on the route between Seoul and Paris. The new service, which commenced on March 30, 2014, will see (KAL) operate its 407-seat A380 to the French capital, replacing the 291-seat Boeing 777-300 that previously served to route. This marks a capacity increase of +40%.
(KAL)'s A380 will now depart Seoul's Incheon International Airport at 1:05 pm daily, arriving at Paris Charles de Gaulle Airport at 6:20 pm the same day. The return flight will then leave Paris at 9:00 pm, getting back into Seoul at 2:50 pm the following day.
(KAL)'s A380 has the fewest seats of any operating in the skies today, with just 407 in three classes, including an entire upper deck dedicated to business (C) class. (KAL) currently operates eight A380s, including double daily flights to New York and Los Angeles.
April 2014: Japan Airlines (JAL) and Korean Air (KAL) have expanded their code share agreement to the North Asian region, despite being key players in two different alliances. From April 22, Oneworld (ONW) Alliance member (JAL) and SkyTeam (STM) Alliance’s (KAL) will add around +8 more destinations from the original Seoul to Komatsu, Niigata, and Sapporo routes, and also include flights from Korea’s Busan and Jeju airports.
The new destinations (now available as (JAL)-flagged routes) will be from Aomori, Akita, Haneda, Oita, and Okayama to Incheon International.
In addition, (KAL) flights from Busan to Fukuoka and Sapporo, and from Jeju to Nagoya, will be part of the code share agreement.
May 2014: Korean Air (KAL) has inaugurated its latest service to the USA with the launch on May 2nd of daily flights between Seoul Incheon (ICN) and Houston Intercontinental, Texas (IAH). The 11,340 km route will be operated by a mix of (KAL)’s 777s, and will face no direct competition. Korean Air (KAL) already operates more flights to the USA than any other Asian carrier, with direct services to Atlanta, Chicago, Dallas/Fort Worth, Honolulu, Las Vegas, Los Angeles, New York, San Francisco, Seattle, and Washington DC.
A380-961 (130, HL7627), ex-(F-WWSD) delivery.
July 2014: Korean Air (KAL) will nearly double its flight schedules to several of its main China destinations. On the back of increased business and tourism demand from China, (KAL) will expand its Incheon - Beijing flights from 11x- to 14x-weekly, mainly on late night and early morning slots. (KAL) will also boost flights on the Incheon - Guangzhou route from 4x- to 7x-weekly.
(KAL) is also ramping up services at several other tier-two cities. It will be increasing frequencies from the secondary cities of Yanji to 7x-weekly, Wuhan to 5x-, Shenzhen to daily, and Mudanjiang to 5x weekly. Most new services will be implemented from July; the remainder will begin from the start of August, taking the total flights per week from China to Incheon to around 35, nearly doubling service.
(KAL)’s new routes are being opened on the back of a recent legal dispute between (KAL) and rival Asiana Airlines (AAR) over the allocation of slots by Korea’s Ministry of Transport, Land & Infrastructure (MTLI). (MTLI) recently allocated (AAR) rights to 22 new Chinese-destination slots including to Chengdu and seven other second-tier destinations.
Korean Air (KAL) has introduced the ninth Airbus A380 to its fleet, underscoring its upmarket approach in using Airbus (EDS)’s largest passenger airplane. “This is the most spacious flight to Asia yet,” (KAL) VP Marketing Americas, John Jackson said. He underlined A380-specific factors such as a “sense of openness and freedom in the air,” adding that (KAL)’s premier-class "Kosmo Suites" are designed to “reflect the feel and elegance of a private jet.”
The new A380 makes its first commercial flight July 6 from Seoul Incheon to Hartsfield-Jackson Atlanta International Airport to extend (KAL)’s A380 international routes to Los Angeles, Atlanta, and Paris.
(KAL) has pitched its airplane firmly into the prestige passenger segment with only 407 seats, compared to a potential maximum of some 800 passengers in a single-class airplane. Its cabin layout uses 94C full-flat Prestige Sleeper seats on the upper deck, plus 12F private Kosmo Suites and 301Y economy class seats on the lower deck. This compares to European A380 operators such as AirFrance (AFA) and Lufthansa (DLH), which both offer well over >500 seats on the A380.
However, this emphasis on high load factors is something that has hit carriers such as (AFA), Qantas (QAN) and (DLH), which have all seen a proportion of empty seats on their scheduled flights. However, Asian carriers are marketing the A380’s space and quietness, which seems to be paying off.
Almost half the A380s flying to date (Airbus lists 132 in service as of May) is based with Asian carriers. Singapore Airlines (SIA) has 19, Korean Air (KAL) will take 10, Asiana Airlines (AAR), Thai Airways (TII), and Malaysia Airlines (MAS) will have six each, and China Southern Airlines (GUN) has five.
In most of these cases, the seating plans favor the more open, higher appointment level approach. As (KAL)’s Jackson said, the airline’s intention is to “make in-flight a real attraction. These all help to make the trip not so much about the destination, but also a memorable journey.”
Korean Air (KAL) took delivery of its 10th A380, completing its order for 10.
October 2014: SkyTeam (STM) Alliance member, (CSA) Czech Airlines is working to get financial help from key shareholder, Korean Air (KAL) to overcome its financial struggles. Several media outlets are reporting that, as of September, an estimated $20 million is required.
“There has been a significant shift in negotiations with (KAL),” (CSA) said, adding that (KAL)’s capital contribution is conditional on (CSA)’s execution of measures outlined in its restructuring plan.
In 2013, (CSA) announced a loss of -CZK922 million/-$42.4 million.
Korean Air (KAL) holds a 44% stake in (CSA) and saved the Czech flag carrier from bankruptcy in spring 2013.
According to the statement, (CSA) management has been reviewing (KAL)’s proposal and will present it to Czech Aeroholding management, which is also ready to provide (CSA) with a capital contribution as a private investor.
(CSA) management is convinced this important move will help stabilize the carrier in the immediate future.
Czech Aeroholding, a state-owned company, is in the process of reducing its (CSA) stake to 19.74% from 53.74%.
According to the European Union (EU) rules, non-(EU) carriers must have shares below 50% in European airlines. To be able to help (CSA), Korean (KAL) has announced an agreement with Prague-based, privately owned Travel Service (TSF) to cooperate on (CSA)’s management. Travel Service (TSF) agreed to acquire 34% of (CSA) from Czech Aeroholding. Korean Air (KAL) needs (TSF) and Czech Aeroholding as local partners to retain the Czech carrier’s European status.
It is expecting to obtain regulatory approvals in the coming weeks.
Czech Aeroholding also owns the operator of Prague International Vaclav Havel Airport.
Meanwhile, a planned strike by (CSA) flight attendants (CA) to protest layoffs has been canceled following a compromise agreement between (CSA) management and Cabin Crew Trade Union representatives. In September, (CSA) unveiled plans to lay off about a third of its 230 pilots (FC), nearly half of its 400 cabin crews (CA) and a quarter of its 270 administrative staff.
According to local media reports, the compromise includes layoffs of -135 cabin crew (CA), 65 pilots (FC) and 26 administrative staff.
In addition, (CSA) will put its entire fleet of Airbus A320-200s up for disposal as it continues to fight to find a niche in the market. In the interim, four A320s have been wet leased to Travel Service (TSF) for the summer 2014 season.
November 2014: Korean flag carrier Korean Air (KAL) plunged to a steep net loss in the third quarter, mainly due to unfavorable currency shifts that outweighed gains from lower fuel prices.
December 2014: The European Commission (EC) has approved plans for Czech carrier Travel Service (TVS) to take a 34% shareholding in national carrier (CSA) Czech Airlines.
(CSA) said it welcomed the decision, as it would help stabilize the loss-making company and “enhance its further development.” The largest shareholder in (CSA) is Korean Air Lines (KAL), which has a 44% shareholding. (KAL) announced late last year, that it wanted to exercise options to buy more (CSA) shares, but European Union (EU) regulations do not allow (EU) airlines to be controlled by non-(EU) entities.
To comply with this requirement, (KAL) acquired the shares from Czech government body, Czech Aeroholding and transferred them to Travel Service (TVS). It is this transaction that has been approved by the (EC) and by four Czech organizations that monitor potentially monopolistic deals.
When the transaction’s formalities are completed within the next few weeks, the shareholding structure of (CSA) will be: Korean Air (KAL) 44%, Travel Service (TVS) 34%, Czech Aeroholding 19.74% and eská Pojišovna (a Czech insurance company) 2.26%.
(CSA)( said the link-up with (KAL) has already allowed it to make improvements to its business, including the re-introduction of long-haul flights using an Airbus A330-300 leased from (KAL). This has been stepped up from an initial 2x-weekly to 3x-weekly frequency, with 4x-weekly services due to be introduced from the start of the summer 2015 season.
The Prague - Seoul sector, together with a code sharing arrangement between the two airlines, allows (CSA) to offer onward services to more than >40 Asia-Pacific destinations that it would not be able to serve itself.
February 2015: News Item A-1: Korean Air (KAL) posted a -KRW272 billion/-$247.5 million net loss for the fourth quarter and a -KRW458 deficit for the full year, widened from a -KRW57 billion loss recorded in the year-ago period.
(KAL) has not been able to reap the financial benefits of low fuel prices that other airlines have, as unfavorable exchange rate shifts continue to negate the fuel cost cuts.
(KAL) achieved an operating profit of +KRW153 billion in the quarter due to fuel savings, an improvement from a +KRW18 billion operating profit in 2013. Overall fuel cost was down -13.2%, with a -16.4% drop in unit price more than offsetting a +2.3% consumption increase.
However, non-operating items had a far bigger effect on the net result. Foreign currency losses amounted to -KRW353 billion in the fourth quarter, a dramatic turnaround from a +KRW248 billion gain in the previous year. Exchange rate movements boosted debt costs denominated in USA dollars.
International traffic growth of just +0.4% failed to keep up with a capacity increase of +1.9% in the quarter. The international load factor slipped -1.1% points to 73.8% LF, and yield declined by -7.5%. Demand weakness was also evident in (KAL)’s much smaller domestic operation.
Consolidated revenue fell -1% in the fourth quarter. Ticket sales in Japan were down -25%, partly due to the weaker yen influencing overseas travel. Sales in North America and Europe also declined significantly, although sales in Korea, Southeast Asia and China were up +1% to +2%.
Cargo demand was a bright spot for (KAL), as traffic rose +5.3% on a +3.2% capacity gain. Cargo load factor increased +1.6 points to 80.3% LF, although yield dropped -3.2%.
Meanwhile, (KAL) plans to continue its freighter fleet upgrade with a new order for five Boeing 777F freighters, in addition to one it already has on order. (KAL) also has two 747-8Fs to be delivered. (KAL)’s current cargo fleet consists of 17 747-400Fs, five 747-8Fs and four 777Fs.
News Item A-2: Korean Air (KAL) plans to revise its Italian services from a Seoul - Milan - Rome double-header circuit to direct flights to each city due to increasing traffic on the Asia-Europe sectors and impending competition from regional low-cost carriers (LCC)s.
From the end of February, (KAL) plans to run two separate services (a 3x-weekly Boeing 777-300ER schedule from Seoul Incheon to Rome Fiumicino Airport, and a 3x-weekly Airbus A330-200 flight from Seoul to Milan Malpensa Airport).
(KAL) also plans to increase flight regularity to 4x-weekly to Milan from the end of March along with a capacity upgrade service to a 777-200ER, in addition to boosting overall capacity on the Rome flights later in the year.
(KAL) said the service expansion allows it to tap into the projected growth in Korean tourists traveling internationally. According to (UN) figures, the country posted a +61.7% growth rate for inbound tourism from 2008 to 2012, the highest rate of growth in the world at the time.
Korean Air (KAL) begins 3x-weekly, Incheon - Milan and - Rome services on February 25, with Milan increasing to 4x-weekly in March. The Rome service sees a change of gauge on March 29 to Boeing 747-400s from Boeing 777-300ER airplanes. Milan service will use A330-200s until March 29, when it will begin using 777-200ERs. Also, (KAL) and American Airlines (AAL) have signed a code share agreement. Pending approval, (KAL) will place its code on (AAL) flights between Dallas/Fort Worth and Incheon. The new agreement will allow (KAL) "SKYPASS" members to earn miles when traveling on (AAL)-operated flights between (DFW) and (ICN).
News Item A-3: Korean Air (KAL) is expanding its route network into China with four new services to second-tier cities, buoyed by increasing demand.
The South Korean flag carrier will introduce flights from Incheon to Hefei and Nanning, from tourist center Jeju to Guiyang, and from Daegu to Shenyang. First flights will begin in late March, with the last new schedule slated for mid-June, using Boeing 737-800 airplanes.
According to China’s National Tourism Administration (CNTA), some 5.2 million Chinese will have traveled internationally over the 2015 Chinese New Year holiday (with 15.6% visiting South Korea, making it the No 1 overseas destination for Chinese passengers).
In 2014, more than >6.3 million Chinese visitors traveled to South Korea, reflecting a +46% increase from 2013, according to South Korean government statistics. “This year, the number of tourists continues to grow, due to an easier visa application process for Chinese passport holders, and the depreciation of foreign currencies against the yuan,” the (CNTA) said.
The new Korean Air (KAL) services reflect an increasing interest in China’s second cities as a growing potential market. They follow recent announcements from AirAsia X (ASX) of its sixth China route from Kuala Lumpur International Airport 2 to Chongqing; and from Alitalia (ALI), which recently detailed plans to launch flights from Rome and Milan to Beijing, and Shanghai in the second half. Both airlines will operate several times a week using A330 airplanes.
News Item A-4: INCDT: A taxiing Korean Air (KAL) Airbus A330 hit a parked Bangkok Airways (PGB) ATR72-600 at Yangon International Airport, Myanmar, at the weekend, significantly damaging the parked airplane’s rudder and trim tabs.
The pilot (FC) and crew (CA) of the (KAL) A330 were apparently not aware of the collision and took off as scheduled late that night.
The damage to the wingtip of the A330, flight KAL 472, was not revealed but the airplane, which was carrying 134 passengers and 11 crew ((FC) - (CA)) and bound for Incheon, Korea, received a turn-back call from Myanmar (ATC) some 20 minutes after takeoff.
The airplane turned back when alerted of the collision and potential damage, by (ATC) following a report of the damage to the ATR72-600 by a member of the Yangon Airport ground crew.
The incident follows a ground collision of a Golden Myanmar (GMY) A320 and a Myanmar Airways (BRM) A319 last April, aggravated by restricted apron space at the airport, which has only four gates to handle some 3 million passengers from more than >20 airlines every year.
An expansion of the current facilities is being undertaken alongside a plan to build a new airport to ease congestion at Yangon.
News Item A-5: Korean Air (KAL) has placed an order for five Boeing 777F freighters, valued at more than >$1.5 billion at current list prices.
Boeing (TBC) said the five 777Fs take (KAL)’s outstanding commitment to nearly 40 airplanes, including 12 777-300ERs, 10 747-8Is, 10 787-9s, two 747-8Fs and six 777Fs.
(KAL), which is one of the world’s largest cargo airlines, currently operates an all-Boeing freighter fleet, comprising 17 747-400Fs, five 747-8Fs and four 777Fs. Its passenger fleet also includes Airbus (EDS) airplanes.
According to the Boeing World Air Cargo Forecast, global air freight traffic is forecast to grow at an annual rate of +4.7%, doubling the cargo traffic over the next 20 years.
April 2015: News Item A-1: Korean Air (KAL)is to introduce Airbus A330-300s on Incheon - Sydney, Brisbane, and Singapore services as well as yet unspecified routes in Southeast Asia and Oceania. (KAL) currently operates 18 A330-300s with +3 more due for delivery by the end of 2015.
News Item A-2: Czech airline company Travel Service (TVS) has completed acquisition of a 34% stake in Czech Airlines (CSA), becoming (CSA)’s newest and second largest shareholder. The deal was approved by the European Commission (EC) in December 2014.
As a result of the transaction, Korean Air (KAL) remains the major shareholder, with 44%, followed by Travel Service (TVS) (34%), Czech Aeroholding (19.735%), and Česká Pojišťovna (2.265%).
Czech Airlines (CSA) said it viewed “the entry of Travel Service (TVS) into its management structure as an important step towards enhancing the management principles of a private business entity and an opportunity to continue transforming (CSA) into a modern European air carrier.”
(CSA)'s board of directors remains unchanged, and the restructuring process approved by shareholders in September 2014 continues, with the emphasis on increasing operational efficiency, and changing the company’s business model and routes management.
Travel Service (TVS) was founded in 1997 and operates scheduled and charter flights under the SmartWings (SMW) brand (since 2004) and private business jet services (since 2007).
May 2015: News Item A-1: Korean airlines will face new and more stringent reporting requirements as part of a government drive to increase transparency in transport safety standards.
The move comes after a spate of incidents at Asiana Airlines (AAR), and the sinking of the Sewol ferry (both of which resulted in unfavorable reports on operational and safety systems).
“We expect the revision will force businesses to strengthen safety operations so that people can use their facilities more safely,” a Korean Fair Trade Commission (FTC) spokesperson said.
The new legislation, which will enable the imposition of up to $100 million won/$92,000 per offense, will require the disclosure of safety and certification test results, plus publicly accessible information on the manufacture, maintenance and inspection of any airplanes.
The regulations will also stipulate that airlines will be required to state the methods used for compensation if an accident does happen.
“Consumers can make more informed decisions, if they know what they [will] get with the services,” the (FTC) said.
News Item A-2: "Korean Transport Ministry is Pushing for Aircraft Age Limit" by Jeremy Torr, Air Transport World (ATW), May 22, 2015.
Korea’s Ministry of Land, Infrastructure, & Transport (MLIT) is urging all Korean airplane operators to replace or mothball all airplanes that are more than two decades old.
The (MLIT) said that eight of the country’s carriers had signed a Memo of Understanding (MOU) in which they “voluntarily agreed to replace all their airplanes that are 20 years old or older.”
The move comes following a spate of airplane maintenance issues in the region.
In April, Japan and Korea suspended charter flights from Thailand following an (ICAO) inspection, and two air operator’s certificates (AOCs) in the Philippines were withdrawn recently following a European Aviation Safety Agency (EASA) audit.
To date, Korean Air (KAL), Asiana Airlines (AAR), Air Busan (ABN), Jeju Air (JJA), Jin Air (JIN), Air Incheon, Eastar Jet (EJS), and T’way Air (TWY) have all agreed to the 20-year ruling.
The (MLIT) said the agreement was part of Korea’s “ongoing efforts to improve on airline safety.” The (MLIT) said records indicate that of 264 airplanes in service this month, some 14 are (MLIT)’s new voluntary age limit. These are four Korean Air (KAL) Boeing 747-400s, Air Incheon (ICH) 737-400Fs, and Asiana (AAR) 767-300 and 747-400F cargo airplanes.
Korean Air (KAL)’s average airplane age is 9.89 years; No 2 carrier, Asiana Airlines (AAR), has an average airplane age of 8.47 years, according to the Ministry.
Compared to the USA, Korean fleets are mere toddlers, the (MLIT) said, citing Delta Air Lines (DAL)’s fleet that has 234 airplanes 20+ years old, and American Airlines (AAL)’s fleet, which has 233+ airplanes of that age or more.
Although the (MLIT) noted that “there currently is no limit on the age or lifespan of an airplane,” it said the move would help improve both overall safety and efficiency.
777-385ER (42123, HL8011), Air Lease Corporation (ALE) leased.
June 2015: News Item A-1: China’s Airlines Reroute Flights, Refund Tickets to South Korea after Middle East Respiratory Syndrome (MERS), Alert" by (ATW) Jeremy Torr, June 10, 2015.
Following a Middle East Respiratory Syndrome (MERS) Red Alert warning by the Hong Kong government, warning travelers against flying to Korea, Cathay Pacific Airways (CAT) and its subsidiary, Dragonair (DRG) have committed to refunds or re-routing for all existing tickets to Seoul, Busan and Jeju up to the end of August.
In addition, Taiwan-based China Airlines (CHI), (EVA) Air, TransAsia Airways (FSH), and Mandarin Airways (MDN) are also offering full-refund cancellations in the immediate term for Korean flights.
Korea has reported 95 cases of (MERS), with seven deaths in the country. As a result, the Hong Kong Security Bureau issued an Outbound Travel Alert (OTA), advising passengers to avoid “all non-essential travel” to the country.
In addition, Taiwan and Macau have both advised against unnecessary travel to any destination in South Korea, and are mandating that passengers wear facemasks disembarking from Korea-originating flights.
Since the virus was discovered in 2012 in Saudi Arabia, the (MERS) outbreak has killed more than >300 people in more than >20 countries. First identified in Saudi Arabia where it claimed the lives of more than >100, (MERS) is suspected of being spread by respiratory and direct contact vectors.
Cathay Pacific (CAT) and (DRG) say they are “monitoring the situation closely” and have provided extra facemasks, hand sanitizers and gloves for use on any airplanes traveling to Korea. Both carriers are looking at extra sanitation procedures in addition to routine cleaning on airplanes flying to potential infection areas.
Authorities in South Korea temporarily closed two hospitals amid persistent fears about the Middle East Respiratory Syndrome (MERS) outbreak, which had killed 14 people through June 13th. Twelve new infections also were reported, the Health Ministry said. Nearly 140 people in the nation have been diagnosed with (MERS) since the country reported its first case last month.
News Item A-2: Korean Air (KAL) has signed a Memo of Understanding (MOU) with Airbus (EDS) to acquire up to 50 A321neo aircraft, its first of the type. The agreement, covering 30 aircraft plus 20 options, was announced at the Paris Air Show.
(KAL) has also signed an (MOU) with Boeing for 30 737 MAX airplanes and two additional 777-300ERs, with options on an additional +20 737 MAXs. The agreement is valued at approximately $3.9 billion at current list prices.
(KAL), the Korean flag carrier selected (CFM) (LEAP-1B) engines to power the 30 737 MAX airplanes in an engine order valued at $877 million at USA list prices, including spare engines.
With this commitment, Korean Air (KAL) is poised to become a new 737 MAX customer when this order, which includes MAX 8s and substitution rights for MAX 9s, is finalized. With this commitment, (KAL) will increase the size of its unfilled orders with Boeing to 69 airplanes.
Both commitments reflect (KAL)’s ongoing fleet modernization program.
(KAL) will operate the A321neo with a two-class, full-service layout on regional services, including on longer sectors to selected destinations in Southeast Asia. The A321neos will be fitted with premium amenities, including wider seats in both classes and the latest in-flight entertainment and connectivity systems.
July 2015: News Item A-1: "Singapore’s Changi Airport Signs Up 5 New Airlines for T4" by (ATW) Jeremy Torr, July 13, 2015.
Singapore’s Changi Airport will have five new tenants for its new S$1 billion/$750 million Terminal 4, due to open in the second half of 2017.
The new tenants include three AirAsia subsidiaries (AirAsia Berhad (Malaysia) (ASW), Indonesia AirAsia (AWR) and Thai AirAsia (THA)) as well as flag carriers Korean Air (KAL) and Vietnam Airlines (VIE). They will join lead tenant Cathay Pacific Airways (CAT) as Terminal 4 launch airline customers.
The new terminal is billed as a replacement for the airport’s previous Budget Terminal, but also as an extension of the airport’s full-service provision. It will boost Changi’s overall passenger capacity from 66 million passengers a year to around 75 million in its initial phases, and will eventually have a maximum planned capacity of 16 million passengers.
Changi Airport Group (CAG) said a mix of tenants will occupy the new terminal’s four wide body and 17 narrow body gates; more announcements are on the way.
The terminal will feature new, high-tech processing technology for travelers. This will include a complete self-service check-in facility including automated registration and bag drop, facial recognition immigration clearance, and scanned-in self-service boarding processes.
(CAG) management says the new technologies will eliminate the need for manual verification and lead to shorter queuing times and increased flexibility through usage of the self-service kiosks.
“Passengers can expect to pass through the various touch points more smoothly and stress-free, giving them more time to enjoy the facilities,” (CAG) Executive VP Air Hub & Development, Yam Kum Weng said.
(CAG) speculates the new technologies will also boost long-term growth, which has slowed at Changi over recent quarters. The new systems are billed to bring both time saving and lower operating costs for tenant airlines, with some -40% less processing costs compared to other terminal operations.
However, the lack of direct SkyTrain access to the other Changi terminals has seen local low-cost carriers Scoot (SCT) and Tigerair (TGR) hold back on support for the new facility. Transit passengers will need to take buses from T4 to other departure points, something Scoot (SCT) (CEO), Campbell Wilson was highly critical of last year.
News Item A-2: "Korean Air (KAL) "Nut Rage" Executive, Heather Cho Requests USA Lawsuit to Be Dropped" By Michelle FlorCruz, IBTimes.com July 14, 2015.
The former Korean Air (KAL) Executive VP, who last year was involved in a controversial midflight "nut rage" incident, has requested that a New York court drop charges filed against her by a flight attendant (CA), so she can instead be tried in her home country of South Korea. Heather Cho stands accused of inflicting verbal and physical abuse as well as damaging the flight attendant (CA)'s career.
Cho submitted a request to dismiss the civil suit filed by Kim Do-hee, (KAL)'s junior flight attendant (CA) who was also involved in the "nut rage," to the Supreme Court of the State of New York, the "Korea Times" reported.
The incident occurred last December, when Cho demanded a Seoul-bound plane return to its gate, while it prepared for takeoff at John F Kennedy International Airport in New York City. Cho was outraged that Kim had served her macadamia nuts in a bag instead of on a plate. During her rage, she also forced the flight's Chief Attendant, Park Chang-jin, off the plane.
Cho had already served nearly 5 months behind bars, when she was released in late May by an appeals court in Seoul, which suspended a sentencing given earlier this year of one year in prison for her outburst, "Reuters" reported. Despite her release, Cho still faces continued legal drama.
Cho is claiming that the case in the USA is unnecessary, because she is also being investigated and tried in South Korea. The former executive added that all the documents were written in Korean and a trial in South Korea would be more fair because local laws do not limit compensation. She argued that the only reason why Kim filed the case in the USA as well, was so she could get more compensation. Cho's lawyers said that the investigation involved nearly 8,000 pages of documents that would have to be translated in order for the criminal suit to be pursued in the USA.
Meanwhile, Park plans to file a lawsuit against Cho in the USA, seeking compensation of up to 50 billion won, or roughly US$44 million.
August 2015: News Item A-1: Korean Air (KAL) posted a first-half consolidated net loss of -KRW302 billion/-$267 million, reversed from a +KRW206 billion profit in the year-ago period. Foreign exchange losses totaled -KRW174 billion in the first half, a negative shift of -KRW494 billion year-over-year. Korean currency weakness hit (KAL) particularly hard since 63% of its debt is in USA dollars.
Excluding foreign exchange losses and other special items, (KAL) achieved a first-half operating profit of +KRW187 billion, compared to a +KRW1 billion profit in the first half of 2014.
First-half passenger revenue was affected by the Middle East Respiratory Syndrome (MERS) outbreak in Korea, which caused some travelers to stay away from Korea, prompting (KAL) to temporarily suspend some routes.
Second-quarter international traffic rose +7.6% on a +3.3% capacity gain, with domestic traffic up +9.8% on a +1.8% capacity increase. In both sectors, traffic declined in June as (MERS) began to have an effect. For the quarter, yield was down -17.5% for international and -20.9% for domestic routes.
Second-quarter revenue was down in every region except Europe, where it was flat. The highest second-quarter revenue declines were -9% for North American routes and -8% on Chinese services. In addition to (MERS), lower fuel surcharges also affected revenue. (KAL) expects demand to recover in the third quarter since the (MERS) threat has receded.
As with other Asian carriers, (KAL)’s cargo business was weaker in the second quarter. Cargo traffic was essentially flat despite a +2.9% capacity increase, causing load factor to drop -2.1 points to 77.6% LF. Yield fell -16.4% in the quarter.
As of June 30, (KAL) had 125 passenger airplanes and 28 freighters in its fleet. It expects to add another 13 passenger airplanes in the second half.
News Item A-2: Korean Air ((IATA) Code: KE, based at Seoul Incheon) (KAL) has taken delivery of its first 747-8B5I (40905, HL7630) following its arrival at Seoul Incheon from Everett on August 25. The quadjet is the first of ten on order from Boeing (TBC) of which a further three are scheduled for delivery this year. The remaining six will arrive over the course of 2016 and 2017.
(KAL) plans to initially deploy its 747-8s on flights from Incheon to Frankfurt International, Singapore Changi, and San Francisco, California during the last quarter of the year.
With seven 747-8Fs already in revenue service, (KAL) becomes the first airline in the world to operate both the passenger and freighter versions of the 747-8.
September 2015: News Item A-1: Technology specialist (WIN) is expanding its e-booking system to connect independent forwarders to 16 airlines. (WIN) already connects to over 90 airlines for electronic Air Waybill (e-AWB). The carriers available for e-bookings include British Airways (BAB), Iberia (IBE), Etihad Airways (EHD), (SAS), Singapore Airlines (SIA), Jet Airways (JPL), Swiss (CSR), American Airlines (AAL), Air France (AFA), Finnair (FIN), Korean Air (KAL), (KLM), Lufthansa (DLH), United Airlines (UAL), Emirates (EAD), and Gulf Air (GUL). The all-in-one tool includes the ability for customers to look up flight schedules, create and manage bookings in real-time, transmit (e-AWB) data, and receive full (e-AWB) tracking automatically.
November 2015: News Item A-1: South Korea is expanding its air services agreements (ASAs) with key international destinations, including India and Austria.
The new agreement with India raises allocations from 6x-weekly to 19x-weekly for carriers between the 2 countries, and also includes a relaxation of code share restrictions between operators in the 2 countries.
The Austria - Korea agreement is more wide-ranging and completely removes any restrictions on flight numbers for direct services between the 2 countries. The previous ASA saw only 4x-weekly flight schedules, with Korean Air (KAL) taking the majority (3x-weekly) between Korea’s Incheon International and Austria’s Vienna International.
This open agreement with Austria is only the second of its type for Korea; it has a similar unrestricted numbers (ASA) with Spanish operators as part of its push into European markets.
Both moves are likely to see an increase in operators on both route sectors. Korean Air (KAL) currently flies 3x-weekly to Mumbai from Incheon and Air India (AIN)/(IND) has a 4x-weekly service from New Delhi to Incheon, but the increased flight options will likely see other key destinations such as Chennai and Bangalore added to schedules, a spokesperson for Korea’s Ministry of Land, Infrastructure & Transport (MLIT) said.
(MLIT) also said it had signed extended (ASA)s with countries including Zimbabwe and Mongolia for direct flight permissions in 2016, and was talking to Brunei, Switzerland, Azerbaijan, Singapore, and Finland to add to existing (ASA) provisions.
News Item A-2: "Boeing, Korean Air Finalize Order for 30 737 MAXs, 2 777-300ERs" By www.aviationnews.eu Rob Vogelaar, November 5, 2015.
Boeing (TBC) and Korean Air (KAL) finalized (KAL)’s order of 30 737 MAXs and +2 additional 777-300ER (Extended Range) jetliners valued at nearly $4 billion at current list prices. (KAL) also has options for additional 737 MAXs as part of the order, which was previously announced as a commitment during the Paris Air Show in June.
With this order for up to 52 Boeing airplanes, (KAL) becomes Boeing’s newest 737 MAX customer and now has 62 firm Boeing airplane orders on backlog. As part of this order for 737 MAX airplanes, (KAL) also adds another 2 777-300ERs as it continues to modernize its long-haul wide body fleet.
(KAL) currently operates a fleet of 91 Boeing passenger airplanes that consist of 737, 747 and 777 models. (KAL) also operates an all-Boeing cargo fleet of 28 747-400F, 747-8F and 777F Freighters.
Korean Air (KAL)’s Aerospace Division is a key Boeing (TBC) partner on both the 747-8 and 787 programs, supplying the distinctive raked wing-tips for each model. They are also 1 of 2 suppliers producing the new 737 MAX Advanced Technology (AT) Winglet.
The 737 MAX incorporates the latest technology (CFM) International (LEAP-1B) engines, Advanced Technology winglets and other improvements to deliver the highest efficiency, reliability and passenger comfort in the single-aisle market. Beginning in 2017, the new single-aisle airplane will deliver -20% lower fuel use than the 1st Next-Generation 737s and the lowest operating costs in its class (-8% per seat less than its nearest competitor. With broad market acceptance, the 737 MAX has 2,929 orders from 60 customers worldwide.
The 777-300ER is one of the most fuel and cost-efficient airplanes in its class as well as the most reliable twin-aisle airplanes in the world. It also has the highest cargo capability of any passenger airplane in service. The 777-300ER will receive further improvements in 2016 designed to reduce fuel use by -2%. The flagship of the world’s elite airlines, the 777-300ER carries 396 passengers in a standard 2-class configuration up to 7,370 nautical miles/13,650 km, on non-stop routes. (KAL) has configured its 777-300ER with a seating capacity of 277 passengers in a 3-class configuration.
(KAL), with a fleet of 166 airplanes, is one of the world’s top 20 airlines, and operates >430 flights per day to 128 cities in 45 countries. It is a founding member of the SkyTeam (STM) alliance, which together with its 20 members, offers its 612 million annual passengers a worldwide system of >16,000 daily flights covering 1,052 destinations in 177 countries.
News Item A-3: "Korean Air (KAL) Finalizes Order for 30 A321neos" by www.aviationnews.eu Rob Vogelaar, November 6, 2015.
Korean Air (KAL) has signed a contract with Airbus covering a firm order for 30 A321neo aircraft plus 20 options, becoming a new customer for the best-selling single aisle A320 Family. The purchase agreement finalizes a commitment announced earlier this year and was signed in Seoul by Walter Cho Won Tae, (KAL) Executive VP and Fabrice Brégier Airbus President & (CEO).
The order comes as Airbus (EDS) and (KAL) celebrate 40 Years of Airbus operations at the airline, which began in October 1975 when (KAL)’s 1st A300B4 entered service on the Seoul - Fukuoka route. Since that time, (KAL) has continuously operated Airbus wide body aircraft, including various versions of the A300, the A330 and the double-deck A380.
(KAL) placed its 1st order, for the original A300B4 in September 1974, becoming just the 4th airline in the world and the 1st from outside Europe to sign an aircraft purchase agreement with Airbus. Today, the A380 is the flagship of (KAL)’s long haul fleet, while the mid-size A330 is operated by the airline on services across the Asia-Pacific region, as well as on selected routes to Europe.
January 2016: News Item A-1: Korean Air (KAL) has become the 5th carrier to offer flights between Busan (PUS) and Taipei Taoyuan (TPE). On January 25, (KAL) began daily flights on the 1,344 km route using its 737-800s. Competition on the route is considerable with China Airlines (CHI) (14x-weekly flights), Air Busan (ABN) (10x-weekly flights), Jeju Air (JJA) (daily flights) and V Air (VAX) (4x-weekly flights) already offering the equivalent of 5x-daily flights between the 2 airports. (KAL) already serves Taipei with double-daily flights from Seoul Incheon using its wide body fleet.
News Item A-2: "Korean Air, Asiana Struggle to Retain Pilots" by Korea Times Lee Hyo-sik, January 11, 2016.
Korean Air (KAL) and Asiana Airlines (AAR) are struggling to retain their pilots (FC), who are being tempted by higher salaries and better incentives offered by Chinese rivals.
The increasing exodus of local pilots (FC) could pose a threat to aviation safety at the country’s 2 flagship carriers, with a growing number of airplanes being flown by inexperienced aviators.
Korean Air (KAL) and Asiana Airlines (AAR) say there isn’t much they can do about the growing exodus, because they are not in a position to improve working conditions for pilots (FC) amid worsening bottom lines.
“China’s aviation market has been expanding at a swift pace over the past few years,” said an airline industry analyst, on condition of anonymity. “This means that Chinese carriers need more pilots (FC) capable of flying commercial jets, but there aren’t many experienced aviators in the world’s 2nd-largest economy.”
The shortage of seasoned Chinese pilots (FC) has forced mainland carriers to recruit foreign pilots (FC), and those flying with (KAL)r and (AAR) have become their main target.
“A pilot (FC) with 15 years of flight experience at Korean Air (KAL) receives about 150 million won a year. But many Chinese carriers reportedly offer 2x- as much, on top of free housing and education subsidies for their children,” the analyst said. “Lured by fat paychecks and attractive benefits, an increasing number of Korean pilots (FC) have moved to China.”
Given that it normally takes many years to train a pilot (FC), Chinese airlines will likely accelerate the recruiting of experienced Korean pilots in the coming years amid the mainland’s rapidly expanding aviation market.
In 2015, a total of 46 Korean Air (KAL) pilots (FC) quit to work for Chinese carriers, up from 2 in 2014 and 7 in 2013, according to airline industry data.
61 pilots (FC) quit Asiana Airlines (AAR) last year to move to carriers based in China and other foreign countries, up from 31 in 2014 and 28 in 2013.
The flagship carriers have also seen an increasing number of junior pilots (FC) move to low-cost carriers (LCC).
“Pilots (FC) at budget carriers get paid less than those at flagship carriers, but they can become captains (FC) within 4 years, while it takes about 10 years at Korean Air (KAL) and Asiana Airlines (AAR),” the analyst said. “When they become captains (FC), they can move to foreign carriers and receive more pay. So to advance their careers more quickly, some junior pilots (FC) prefer to work at budget airlines.”
Desperate to fill the void (KAL), headed by President, Chi Chang-hoon, has been taking all possible measures to retain pilots (FC) but to no avail. To fill the void, (KAL) has hired more foreign pilots (FC), in addition to retired Air Force pilots and those graduating from training schools at home and abroad.
The company recruited a total of 77 non-Korean aviators last year, up from 50 in 2014.
“We are not the only carrier hit by the pilot (FC) exodus. All major carriers around the world are grappling with the same problem,” a (KAL) spokesman said. “We are recruiting experienced and talented pilots (FC) through various channels to replace those who are leaving. We are doing everything we can to maintain an ample number of qualified aviators.”
(KAL) has been recruiting personnel who have completed the “Airline Pilot Program” at Korea Aerospace University in Goyang, Gyeonggi Province.
February 2016: "Korean Air (KAL) Swings to Profit in (4Q) 2015" by
(ATW) Adrian Schofield, February 3, 2016.
Korean Air (KAL) reported a (4Q) 2015 net profit of +92 billion won/+$76 million, reversed from a net loss of -272 billion won in the year-ago period, although the improved result was heavily skewed by gains related to exchange rate movements.
Operating profit declined -2% year-on-year to 150 billion won. Operating costs for the quarter were down -1.5%, despite a -28.2% drop in fuel spending. The largest cost increase was in the maintenance category, due to engine work for Boeing 777-300ER being concentrated in the fourth quarter.
Domestic passenger load factor rose +8.5 points to 75.2% LF, and international load factor increased +2.5 points to 76.3% LF. A +10% rise in international passengers was attributed to a +24% increase in Korean outbound travel, offsetting a -3% drop in passengers from overseas.
The cargo market continued to show weakness in the quarter. A -4.9% traffic decline outweighed a -1.8% decrease in capacity. Yields were also down significantly.
Korean Air (KAL) plans to take delivery of 16 Boeing airplanes this year to support its plans to increase capacity and meet profit growth projections.
In a presentation released with its 4th-quarter earnings, (KAL) said it will receive 3 Boeing 747-8I Intercontinentals, 2 777-300ERs, and 2 737s that will be operated by low cost carrier (LCC) subsidiary, Jin Air (JIN). All of these deliveries are scheduled for delivery through June. In the 2nd half of the year, (KAL) expects to receive 5 freighter aircraft, comprising 4 777Fs and a 747-8F freighter.
(KAL) will add these to its current fleet of 133 passenger and 28 cargo airplanes. It did not provide details of fleet retirements for this year. (KAL) intends to boost its passenger capacity by +4.1% and its cargo capacity by +2.3% in 2016.
(KAL) forecasts its revenue will rise +6% and its operating profit +28% this year. It expects better performance as the market rebounds from the Middle East Respiratory Syndrome (MERS) scare in 2015 and Korean outbound tourism rises.
March 2016: Korean Air (KAL) has won the 4x-weekly frequencies for flights to Iran that are being allocated by the South Korean government. Rival Asiana (AAR) had also sought these frequencies. (KAL) said it is considering introducing cargo flights to Iran first, although nothing has been confirmed yet. (KAL) was also awarded seven additional frequencies to India. It currently operates three weekly flights from Seoul to Mumbai.
April 2016: Korean Air (KLA) begins 7x-weekly, Incheon - Okinawa on May 5.
May 2016: News Item A-1: INCDT: A Korean Air (KAL) Boeing 777-300 experienced an engine fire and aborted takeoff from Tokyo Haneda International Airport on May 27.
The 302 passengers and 17 crew members ((FC) & CA)) on flight KE2708 bound for Seoul’s Gimpo Airport in Korea were evacuated by emergency chute from the airplane.
Unconfirmed reports in local media cite several passengers as suffering minor injuries during the evacuation.
All traffic was immediately suspended at the airport, but operations resumed shortly after the fire was extinguished by emergency response vehicles.
A (KAL) spokesperson told (AFP) the engine no 1 (left hand wing) caught fire, but was extinguished shortly after the takeoff was aborted at around 1600 hrs local time.
Local media reported the incident disrupted at least 200 flights, causing delays and cancellations for some 50,000 passengers.
News Item A-2: 747-8B5 (60408, HL7638) and 777-3B5ER (60375, HL8041) deliveries.
June 2016: Korean Air Chairman & (CEO) Yang Ho Cho has been re-elected to the (IATA) Board of Governors and the Strategy & Policy Committee, each for a 3-year term.
July 2016: See video on (KAL) 747-8I Business Class from Seoul:
August 2016: 747-4B5ER (26413, HL7466), ferried to Marana for storage and sold to Boeing (TBC) and re-registered N635BC. 777-FB5 (62693, HL8043), ex-(N5514K) delivery.
October 2016: Korean Air (KAL) achieved a net profit of +KRW428 billion/+$378 million for the 3rd quarter, but that followed a period of losses, including a 2nd-quarter net loss of -KRW251 billion and a 2015 3rd-quarter loss of -KRW510 billion.
Preliminary figures show an operating profit of +KRW447.6 billion, which would surpass the 3rd quarter of 2010 as (KAL)’s best-ever quarterly result. The 3rd-quarter 2016 operating profit was +35% higher year-on-year, and (KAL)’s revenue increased +4.7% to over >KRW3 trillion.
While full details are scheduled to be released in November, (KAL) confirms that passenger traffic was up +14% in the quarter, with an increase of +27% on China routes.
(KAL), the South Korean flag carrier revealed it has lost -KRW825 billion related to its support of sister company, Hanjin Shipping over the 1st 3 quarters of this year. However, (KAL) said it will not provide further financial support to Hanjin as the shipping company is under court receivership.
Separately, (KAL) said it will launch 5x-weekly Seoul - New Delhi Airbus A330-200 service on December 1. New Delhi will be (KAL)’s 2nd Indian destination after Mumbai.
December 2016: Korean Air (KAL) has issued a schedule of anticipated flight cancellations through January 10, 2017, because of strike action by its unionized pilots (FC). The pilots (FC) are seeking a significant salary increase.
(KAL) said the impact on operations is minimal; the majority of domestic and international flights are running normally, as is mandated by government law. Flights that are affected include some to the Middle East and Japan and some domestic flights.
January 2017: 747-4B5 (28335, HL7473) ferried to San Bernardino, California, USA and withdrawn from use.
February 2017: News Item A-1: Korean Air (KAL) reported a consolidated net loss of -KRW642 billion/-$565 million in the 4th quarter of 2016, reversed from a profit of +KRW132 billion in the same period a year earlier. The full-year 2016 loss was -KRW557 billion, slightly better than the -KRW563 billion loss in 2015. (KAL) recorded an operating profit of +KRW178 billion for the 4th quarter, with foreign currency-related losses and interest costs the main reason for the net loss.
News Item A-2: Korean Air (KAL) has taken delivery of its 1st Boeing 787-9 (34810, /17 HL8081), making it the 1st airline in Korea to operate the type.
See photo - "KAL-787-9 - 1st 2017-02.jpg."
March 2017: Delta Air Lines (DAL) and Korean Air (KAL) have signed a memorandum of understanding to form an antitrust-immunized transpacific joint venture (JV).
The 2 SkyTeam (STM) alliance members (DAL) and (KAL) intend “to create a fully integrated transpacific joint venture (JV) arrangement, with both airlines sharing the costs and revenues on flights and coordinating schedules for seamless, convenient connections,” (DAL) and (KAL) said in a joint statement. The carriers’ combined network reaches 290 destinations in the Americas and >80 in Asia. The (JV) will enable (DAL) and (KAL) passengers to earn reciprocal frequent flyer benefits.
The carriers had indicated they were exploring an expanded partnership in September 2016 when (DAL) announced plans to launch daily Boeing 777-200LR flights between Atlanta and Seoul Incheon from June 3, 2017, and expand code sharing with (KAL), which already operates daily Seoul Incheon - Atlanta 777-300ER flights. “This agreement deepens our longstanding partnership with (KAL) and will provide the global access and seamless service our customers demand,” (DAL) (CEO) Ed Bastian said March 29.
“This joint venture will benefit our customers by providing more convenient connection schedules and widen their opportunities in earning [frequent flyer benefits],” (KAL) Chairman & (CEO) Yang Ho Cho said. Once the final (JV) agreement is signed, “(DAL) and (KAL) will work together to implement all aspects of the enhanced cooperation, including expanded code sharing, frequent flyer programs and joint growth in the transpacific market, with co-location at key hubs [enabling] seamless passenger and baggage transit experience,” the airlines said.
The (JV) will need to gain regulatory approval, including antitrust immunity from the USA Department of Transportation (DOT).
May 2017: 747-8B5 (60410, HL7643), ex-(N5509S) delivery.
July 2017: Korean Airlines (KAL) took delivery of a Boeing 747-8I and a 787-9.
August 2017: After receiving its 3rd Boeing 787-9 in July, Korean Air (KAL) launched 3x-weekly service between Incheon - Madrid and 4x-weekly service between Incheon - Beijing in early August.
With the Madrid route, (KAL) looks to build on the +18% year-over-year (YOY) increase in European passenger revenue (KAL) saw in the 2nd quarter. The Beijing route, however, flies in the face of declines in China passenger revenue (down -26% (YOY)) and China traffic (down -27% (YOY)).
In the 2017 2nd quarter, (KAL) reported a -KRW200 billion net loss /-US$174.9 million, narrowed somewhat from a -KRW251 billion net loss in the year-ago quarter. A deepening of net foreign currency related losses and interest expenses cut in to (KAL)'s (2Q) +KRW173 billion operating profit by KRW419 billion during the quarter. (KAL) reported KRW2.9 trillion in revenue for the quarter, up +3.1% (YOY) and operating expenses of KRW2.7 trillion, up +2.8% (YOY), The KRW 173 operating profit was a +8.5% increase over (2Q) 2016.
Korean Air (KAL)'s (2Q) passenger traffic increased +2.7% (YOY) to 19.2 billion (RPK)s; Capacity grew +1.1% to 24.1 billion (ASK)s. Overall load factor for the quarter was 79.5% LF, up +1.3 points (YOY). (KAL)'s cargo traffic increased +2.6% (YOY) to 2.1 billion (FTK)s and a freight load factor of 77.9% LF, up +1.3 points (YOY).
Travelers from China, which up until March of this year counted for 47.2% of all foreign visitors to South Korea, dropped precipitously after China announced a ban on March 2 of all group travel to South Korea in protest of South Korea's decision to deploy the USA military's Terminal High Altitude Area Defense (THAAD) missile system on its territory. By June, China's share of foreigner travel to South Korea had dropped to 25.7%. In general, travel to South Korea during the 1st half of 2017 is down -16.7%, according to (KTO), the country's tourism organization.
For (KAL) itself, 2nd quarter traffic was on the rise from Europe (up +14%), SE Asia (+11%) and Oceania (up +4%) but declined from Japan (down -6%) in addition to the China drop. (KAL) said it plans to add alternative routes in the 3rd quarter "to absorb demand from the (THAAD) impact" but did not elaborate what the new routes will be. (KAL) indicated it will expand frequency on its routes between Incheon and Barcelona, San Francisco, Vienna, Bangkok, Ulaanbaatar, and Urumqi while also reducing frequency on its Incheon - Moscow route.
In late June, (KAL) and Delta Air Lines (DAL) finalized their anti-trust immunized transpacific joint venture (JV) to share costs and revenue on flights between the USA and South Korea. In June, (DAL) started daily Atlanta - Seoul Incheon Boeing 777-200LR flights. (KAL) already operates 777-300ER flights between Seoul Incheon and Atlanta, Georgia.
As of June 30, (KAL)'s fleet totaled 131 passenger aircraft and 30 cargo aircraft. In July (KAL) took delivery of a Boeing 747-8I and a 787-9. The next deliveries, scheduled for September, will be a 787-9 and (KAL)'s 1st of 10 Bombardier CS300s. The remainder of the year will see deliveries of the 2nd CS300 and a 777FB5 freighter in October, 2 CS300s in November, and a 787-9 and another CS300 in December.
September 2017: 747-8i (HL7642) 1st passenger service Seoul to Sydney.
October 2017: Korean Air (KAL) is confident it will receive its 1st Bombardier (BMB) CSeries aircraft by the end of this year or early 2018, after its timetable was affected by program delays. (KAL) was to have received its 1st CS300 this month, (KAL) President Walter Cho said at the Association of Asia Pacific Airlines annual assembly. However, deliveries have been delayed because of issues with Pratt & Whitney (PRW) (GTF) engines. Korean (KAL) was previously expecting to receive 4 CS300s.
January 2017: The opening of a new terminal complex at Seoul’s Incheon International Airport is expected to dramatically improve Korean Air (KAL)’s connections with prospective partner Delta Air Lines (DAL) and other SkyTeam (STM) Alliance members. Incheon’s Terminal 2 (T2) opened for service on January 18, with (KAL) moving out of the existing Terminal 1 and into the new facility along with (DAL), Air France (AFA) and (KLM).
The departure lobby at Terminal 2 of Incheon International Airport, has opened 3 weeks before the opening of the Pyeongchang Olympics in South Korea (see photo).
February 2018: News Item A-1: Korean Air (KAL) reported a +KRW479 billion/+$440 million net profit for the 4th quarter of 2017, reversed from a net loss of -KRW672 billion in the year-ago period. The (4Q) profit was boosted by major currency exchange rate gains. Gains related to exchange rate movements totaled KRW608 billion, compared to a loss of -KRW884 billion last year. 4th-quarter revenue increased +5.1%, outstripping a +3.4% gain in operating costs.
News Item A-2: "Incheon Airport Terminal 2 Cuts Connection Times, Improves Facilities. Incheon’s New Terminal Enables its Airline Tenants to be More Competitive" by Adrian Schofield, ATWOnline, February 23, 2018.
Korean Air (KAL) is taking major steps to strengthen its connecting capabilities this year, moving into a new terminal at its Seoul hub and seeking tighter links with USA partner Delta Air Lines (DAL). International transit flows are particularly important in the Asia-Pacific region because of its surging air travel demand. Asia’s airlines are fighting hard to win a greater share of this traffic, causing competition to intensify among the major connecting hubs inside and outside the region.
March 2018: "Korea Gives Go Ahead for Korean - Delta Joint Venture (JV)" by Adrian Schofield (ATW) Plus, March 29, 2018.
South Korean authorities have approved a joint venture (JV) between Korean Air (KAL) and Delta Air Lines (DAL), clearing the way for an expanded partnership of the 2 SkyTeam (STM) alliance carriers, but approval comes with some restrictions. The 2 carriers gained permission from the USA Department of Transportation in November and were waiting for clearance from Korea’s Ministry of Land, Infrastructure and Transport (MLIT).
June 2018: News Item A-1: Delta Air Lines (DAL) expanded its transpacific partnership with Korean Air (KAL) on June 14 as (DAL) announced a new nonstop route between Seattle-Tacoma International (SEA) and Osaka, Japan’s Kansai International (KIX) starting in 2019.
(DAL) will code share the flight with (KAL) as part of the joint venture (JV) partnership launched between the airlines in May. (DAL) plans to fly the route with a Boeing 767-300ER equipped with 25 lie-flat seats in Delta One, 29 “comfort plus” seats and 171 main cabin seats.
Concurrent with the Osaka route announcement, (DAL) said it had “made the difficult business decision” to end its nonstop Seattle to Hong Kong flights, with the last flight out of Hong Kong set for October 4. (DAL) service between the 2 cities will continue, but will be offered via Seoul-Incheon (ICN) on Korean Air (KAL).
The new Osaka route follows on (DAL)’s plan to launch nonstop flights in 2019 between Minneapolis/St Paul International (MSP) and (ICN); as with Osaka, specific schedules will be released later. The (MSP) to (ICN) flights will take advantage of the (DAL) - (KAL) (JV), as the 2 SkyTeam (STM) alliance founding member airlines are co-located in the newly opened Terminal 2 at (ICN). The new Minneapolis route complements 3 existing USA to Seoul nonstop routes (Seattle, Detroit and Atlanta). (DAL) said it will utilize a “newly refreshed” Boeing 777-200ER on the (MSP) to (ICN) route, with 28 Delta One suites including a full height door, 48 premium select cabin seats and 220 main cabin seats.
(DAL) - (KAL) code sharing ramped up following the (JV) partnership announcement. According to (DAL), 132 (DAL)-operated flights from Seattle, Atlanta, Las Vegas, New York, San Francisco, Honolulu, Chicago and Dallas were coded with (KAL) flight numbers in May, adding to 164 existing (KAL) code share markets on (DAL) in North America from (DAL) hubs in Atlanta, Los Angeles and New York (JFK).
In June so far, 66 additional markets from Detroit, Portland, Seattle and Atlanta have become North American code shares, and (KAL)’s code was added to 5 (DAL)-operated flights from Japan to the same USA airports. The new additions expand on 36 existing code share routes with Asia.
News Item A-2: "Korean Air Chief Appears for Questioning over Suspected Tax Evasion" by Joyce Lee, "Reuters" June 28, 2018.
Korean Air Lines (KAL) Chairman Cho Yang-ho appeared on June 28 at the prosecutor's office for questioning over allegations of tax evasion and other financial crimes, as South Korea's family-owned conglomerates face growing scrutiny. "I will tell the prosecutors everything," 69-year-old Cho Yang-ho said before entering the prosecutors' office in Seoul, as protesters called for his arrest.
An angry outburst at a business meeting by Cho's youngest daughter, Cho Hyun-min, sparked public outrage at alleged abuse of power by South Korean family-owned conglomerates, or "chaebols," leading to investigations of several of his family members.
South Korea's President Moon Jae-in has pledged to curb the excessive power of chaebols and improve their governance following a corruption scandal involving his impeached predecessor and the Chief of Samsung Electronics.
"It seems that the government is using the Korean Air (KAL) controversy to tame major chaebols like Samsung and Hyundai," said Park Ju-gun, Head of Corporate Analysis firm (CEO).
Cho is facing charges of tax evasion, breach of trust and embezzlement, a prosecution official said.
Korean Air Lines (KAL) declined to comment.
The junior Cho was under a storm of public criticism for allegedly throwing a drink at a business meeting attendee. She is the younger sister of Heather Cho, who was jailed in 2014 for demanding a Korean Air Lines (KAL) plane return to its gate at a New York airport due to the way she was served nuts in first (F) class.
The Chairman has publicly apologized and had his daughters step down from their positions at (KAL) and its affiliates, while he also quit his position as (CEO) at budget affiliate Jin Air.
Shares of Korean Air (KAL) fell -2.7%, and Jin Air was down -1.6% compared to a 0.9% fall in the broader market as of 0055 (GMT). (KAL) shares have fallen -21% since April when the controversy 1st erupted, while Jin Air has tumbled -21%t, lagging the wider market's 4% fall.
August 2018: "Korean Air Widens (2Q) Net Loss on Higher Costs, Foreign Exchange Losses" by Adrian Schofield (ATW) Plus, August 15, 2018.
Higher fuel costs and deeper foreign exchange losses offset rising revenue for Korean Air (KAL), sending (KAL) deeper into the red for the 2nd quarter. (KAL), the South Korea flag carrier reported a consolidated net loss of -KRW305 billion/-$268.8 million in the quarter, compared to a loss of -KRW200 billion in the same period in 2017.
However, (KAL) achieved an operating profit of +KRW67 billion in the 2nd quarter, down from a +KRW173 billion operating profit a year earlier.
January 2019: Korean Air (KAL) in a recent schedule update filed operational airplane changes, as (KAL) introduces Boeing 787-9 Dreamliner airplanes on the Seoul Incheon (ICN) to Moscow Sheremetyevo (SVO) route. From March 31st, 2019, the 787-9 will operate this route instead of an A330. Operational frequency is 5x-weekly, 7x-weekly from June 01, 2019 to September 30th, 2019.
The (KAL) 787-9 replaces the A330 from March 31st 2019 (daily from June 1st, to September 30th, 2019).
KE923 ICN1320 to 1650SVO 789 x24
KE924 SVO1855 to 0940+1ICN 789 x24
Click below for photos:
KAL-737 MAX - 2015-11-A.jpg
KAL-737 MAX - 2015-11.jpg
KAL-737-900 - 2015-08.jpg
KAL-747-400-WORLD CUP SOCCER
KAL-747-8 HL7643 2018-06.jpg
KAL-747-8B5 40907 2018-05.jpg
KAL-747-8F - HL7629-2017-09-28.jpg
KAL-747-8HTF - 2012-02
KAL-747-8I - 2015-07.jpg
KAL-777 Rainbow 2018-10.jpg
KAL-777-300ER - 2013-01
KAL-777-3B5ER HL7203 2018-10.jpg
KAL-777-FB5 - 2012-02
KAL-787-9 - 1st 2017-02.jpg
KAL-A321neo - 2015-06.jpg
KAL-A380-861 - 2012-05
KAL-Bombardier CS300 - 2017-10.jpg
5/2 ORDERS 737-700/-900:
1 737-7B5 BBJ (CFM56-7B27) (2997-37660, /09 HL8222), 2010-07. WITH WINGLETS. EXECUTIVE. (VIP).
2 737-8BK (CFM56-7B) (3794-39447, /11 HL8240; 3852-38129, /11 HL8241), (TCI) LEASED, EX-(N1786B). WITH WINGLETS. 12C, 180Y.
1 737-8GQ (CFM56-7B26) (2119-35790, /06 HL7757, 2006-12 - SEE PHOTO), (AWW) LEASED. WITH WINGLETS. 12C, 156Y.
1 737-8GQ (CFM56-7B26) (2150-35791, /06 HL7758), (AWW) LEASED. WITH WINGLETS. 8C, 156Y.
1 737-800 (CFM56-7B), (ALE) LEASED 2012-06.
7 737-8Q8 (CFM56-7B26) (2906-37162, /09 HL-7785; 2955-37163, /09 HL7786; 3704-38822, /11 HL8224; 3895-38824, /12 HL8242; 3927-38825, /12 HL8243; 3943-38826, /92 HL8244; 38227, /12 HL8245), (ILF) 8 YEAR LEASED. WITH WINGLETS. 12C, 150Y.
8 737-86N (CFM56-7B24) (460-30230, /99 HL7555; 482-28615, /00 HL7556; 562-28622, /00 HL7557; 590-28625, /00 HL7558; 611-28626, /00 HL7559; 756-28636, /01 HL7563; 765-28638, /01 HL7564; 878-28647, /01 HL7567), (GEF) LEASED, 12C, 150Y.
7 737-8B5 (CFM56-7B24) (622-29981, /00 HL7560; 663-29982, /00 HL7561; 678-29983, /00 HL7562; 848-29984, /01 HL7565; 852-29985, /01 HL7566; 891-29986, /01 HL7568; HL7757* - SEE PHOTO, 2006-11), * WITH WINGLETS. 12C, 150Y.
22 +1/1 ORDER 737-9B5ER (CFM56-7B24) (999-29987, /01 HL7569; 1026-29988, /01 HL7599; 1082-29989, /01 HL7704; 1162-29990, /02 HL7705; 1188-29991, /02 HL7706; 1190-29992, /02 HL7707; 1208-29993, /02 HL7708; 1320-29994, /03 HL7716; 1332-29995, /03 HL7717; 1338-29996, /03 HL7718; 1416-29997, /03 HL7719; 1494-29998, /04 HL7724; 1512-29999, /04 HL7725; 1536-30000, /04 HL7727; 1729-30001, /05 HL7726; 1620-30002, /04 HL7728; 3645-37633, /11 HL8221; 3681-37634, /11 HL8223; 42174, HL7273, 2013-06). 1 +5 WET-LEASED TO (OKA) 2005-03. 8C, 180Y; & 12C, 147Y.
30/20 ORDERS 737 MAX 8 (LEAP-1B) (WITH SUBSTITUTION RIGHTS FOR 737 MAX 9), ADVANCED TECHNOLOGY WINGLETS:
0 747-2B5B (JT9D-7A) (363-21772, /79 HL-7443), WFU. 12F, 24C, 342Y.
2 747-2B5F (SCD) (JT9D-7R4G2) (718-24195, /88 HL7405; 720-24196, /88 HL7408; 454-22481, /80 HL7452 ST (TBC) 2004-02; 520-22486, /81 HL7459, 2004-03). 24195; 24196; LEASED TO CARGO 360 (C36) 2005-06. FREIGHTER.
0 747-200F, (TLS) WET-LEASED 2003-01. RETURNED. FREIGHTER.
0 747-230F (168-20373, /72, HL7441, EX-(DLH), SOLD TO (TBC) 2000-05) (20652 SOLD TO (TBC) 2000-10). 20373 SCRAPPED. 22485 RETURNED TO (UT) FINANCE 2002-07.
0 747-3B5 (JT9D-7R4G2) (611-22489, /85 HL7469), WFU. 30C, 421Y.
3 +7 ORDERS 747-3B5BCF (PW4056) (24199, HL7606; 748-24200, HL7412, 2007-01), CONVERTED TO FREIGHTER, FREIGHTER.
1 747-3B5F (JT9D-7R4G2) (713-24194, /88 HL7470), WICHITA FREIGHTER CONVERSION. LEASED TO CARGO 360 (C36) 2005-06. FREIGHTER.
11 747-4B5ER (PW4056) (1155-26407, /98 HL7402; 1284-26412, /01 HL7465); 26413, HL7466; (24600 PARTED OUT 1999-08 & USED AS A RESTAURANT IN POHANG). 24199 3 YEAR LEASED TO (AIN) 2002-11. 24621 LEASED TO (AIN) 2003-12. 10 TO BE CONVERTED TO SF (INCLUDING 24199, HL7606 - SEE BELOW). 26392; FERRIED TO XIAMEN FOR FREIGHTER CONVERSION. 37645; LEASED TO SOUTH KOREAN GOVERNMENT 2010-5. 26412; 5 YEAR LEASED TO KOREAN GOVERNMENT 2010-03. 26413 FERRIED TO MARANA FOR STORAGE & SOLD TO BOEING (TBC). 10F, 61C, 262Y.
4 747-4B5F (SCD) (PW4056) (454-22481, /80 HL7452; 1323-32808, /03 HL7437). (1286-26413, /01 HL7466; 1291-27073, /01 HL7467) (1295-26414, /01 HL7400; 1316-32809, /02 HL7434), (ILF) 10 YEAR LEASED. FREIGHTER.
9 747-4B5ERF (PW4056) (1329-33515, /03 HL7438; 1338-33516, /03 HL7439; 1340-33517; 1347-33945, /04 HL7600; 1350-33946, /04 HL7601; 1365-34301, HL7602, 2005-10; 1368-34302, HL7603, 2006-01; 1375-35525, HL7605, 2005-06; 1375-35526). FREIGHTER.
0 747-400F (CF6-80C2), (TLS) WET-LEASED, 1999-08, 2000-02. FREIGHTER.
10 ORDERS 747-400SF (PW4000), PAX FOR CONVERSION TO SF. FREIGHTER.
10 747-8B5I (GEnx-2B) (HL-7494, 2018-05; 40905, HL7630; HL7631; 40907, /15 HL7632; HL7637; 60408, HL7638, 2016-06; HL7642, 2017-09; 60410, HL7643, 2017-05; HL7644), 660 PASSENGER.
7 747-8HTF (GEnx-2B) (1425-37132, HL7609, 2012-02 - - SEE PHOTO - "KAL-747-8HTF - 2012-02;" 1426-37133, /13 HL7610; HL7629; HL7639), KOREAN AIR CARGO OPERATIONS. FREIGHTER.
17 +1/5 ORDER 777-2B5ER (PW4090) (59-27945, /97 HL7530; 62-27946, /97 HL7531; 148-27947, /98 HL7526; 305-28444, /00 HL7574; 309-28445, /01 HL7575; 356-27949, /01 HL7598; 411-27951, /02 HL7714; 416-28372, /02 HL7715; 29174, HL7732 NTU; 452-33727, /03; 520-34206, /05 HL7733; 528-34207, /05 HL7734; 584-34208, /06 HL7743; 585-34208, HL7744, 2006-08; 633-34209, /07 HL7751; 657-34210, HL7751, 2007-08; 682-34211, /07 HL7752; 711-34212, /08 HL7765; 730-34213, /08 HL7766; 684-34214, /07 HL7764), 34208; LEASED TO (JIN) 2015-07. 180 MINUTES (ETOPS). 8F, 28C, 212Y.
2 +4 ORDERS 777-FB5 (989-37639, HL8251, 2012-02 - - SEE PHOTO - - "KAL-777-FB5 - 2012-02;" 62693, HL8043, 2016-08; 2017-10), KOREAN AIR CARGO OPERATIONS. FREIGHTER.
2 777-300ER, (ALE) LEASED.
4 +4 ORDERS 777-3B5 (PW4098) (162-29371, /99 HL7532; 178-27948, /99 HL7533; 120-27950, /98 HL7534; 288-27952, /00 HL7573). 8F, 35C, 301Y.
24 777-3B5ER (GE90-115BL2) (HL7203 - SEE PHOTO; 785-37643, /09 HL7782; 806-37644, /09 HL7783; 867-37645, /10 HL8208; 875-37646, /10 B-8209; 882-40377, /10 HL8210; 933-37647, /11 HL8216; 938-37648, /11 HL8217; 976-37649, /11 HL8218; 37650, HL8250; 37651, HL8275; 42123, HL8011, 2015-05; 60375, HL8041, 2016-06), 8F, 56C, 227Y.
1 777-3B5ER (GE90-115BL2) (823-37136, /09 HL7784), GUGGENHEIM PARTNERS (GUG) LEASED 2009-10.
7 +4/10 ORDERS 787-900 DREAMLINER (GEnx-64B) (HL7206; 34810, /17 HL8081, (1ST 2017-02) - SEE PHOTO "KAL-787-9 - 1ST 2017-02.jpg;" 549-34811, /17 HL8082 (CHARLESTON #163) 2017-02; 2017-07; 2017-12), 270 PAX.
0 MD-11F (PW4458) (456-48407, /91 HL7371; 457-48408, /91 HL7372; 495-48410, /92 HL7374; 516-48523, /92 HL7375), (GEH) LEASED 5 YEARS 2000-04. 48408 RETURNED 2005-01. 48523 RETURNED, LEASED TO (WLD) 2005-05. 48410; CRASHED & W/O 2009-11 OPERATING FOR AVIENT (AVE). 48410; RETURNED (AWW) & LEASED TO AVIENT (AVE). FREIGHTER.
0 MD-82 (JT8D-217C) (49374; 49416; 49417; 49418; 49419; 53148), 53147 RETURNED (GEF) 1999-06, 49373 LEASED TO (IMX) 2000-07, 49374 RETURNED (GEF) 2000-09. 49417 RETURNED (GEF) 2001-03; 8 2001-04. LAST 3 RETURNED BOEING 2002-12. 164Y.
0 MD-83 (JT8D-219) (53485 PARTED OUT 1999-08). 160Y
0 A300B4-2C (CF6-50C2) (3 IN STORAGE), 4 SOLD.
2 A300F4-203 (CF6-50C2) (277; 292), 5 YEAR LEASED TO (MHK) 2000-01.
0 A300B4-622 (PW4158) (417, /87 HL7291) SOLD TO (FED), (657; 658; EX-(GIA), 659, TO (AFR) 2000-12). 365 RETURNED TO MITSUI 2002-01. 24C, 242Y.
0 A300B4-622R (PW4158) (582, /90 HL7295; 609, /91 HL7297; 627, /92 HL7239; 631, /92 HL7240; 662, /92 HL7241; 685, /93 HL7242; 692, /93 HL7343; 717, /93 HL7399; 722, /93 HL7344; 731, /94 HL7345); (530 EX-(GUN) (611; 613; RTND 1999-12) (358; 361; 388; 471; RETURNED 2002-02 FOR (FED), 554 SOLD TO (QTA); 477 SOLD TO (INL) 2000-12; 560 SOLD TO (QTA). 479 RETURNED TO LESSOR 2001-01. 361 SOLD TO (INL) 2002-08, 614 SOLD TO (QTA) 2002-08. 717; 722; RETURNED. RETIRED. 24C, 252Y.
2 A300-600F, CONVERTED TO FREIGHTER BY (EADS) (EDS) (EFW) IN DRESDEN. FREIGHTER.
4 A320, (TSF) LEASED FOR 2014 SUMMER SEASON.
30/20 ORDERS A321neo:
11 ORDERS A330 (PW4000):
8 A330-223 (PW4170A) (222, /98 HL7538; 226, /98 HL7539; 258, /99 HL7552; 1133, /10 HL8211; 1155, /10 HL8212; 1200, /11 HL8227; 1203, /11 HL8228). 6F, 24C, 196Y.
5 A330-300 (PW4168), 6F, 22C, 252Y.
5 A330-322 (PW4168) (162, /97 HL7550; 172, /97 HL7551; 206, /98 1133, /10 HL8211; 219, /98 HL7525; 241, /98 HL7540), 6F, 22C, 252Y.
6 A330-323 (PW4168A) (256, /99 HL7554; 267, /99 HL7553; 338, /00 HL7584; 350, /00 HL7585; 351, /00 HL7586; 368, /00 HL7587), 6F, 22C, 252Y.
5 A330-323 (PW4168A) (425, /01 HL7701; 428, /01 HL7702; 484, /02 HL7709; 490, /02 HL7710; 550, /03 HL7720), 6F, 22C, 252Y.
1 +1 ORDER A340-300.
10 A380-861 (GP7270) (35, /11 HL7611; 39, /11 HL7612; 59, /11 HL7613; 68, /11 HL7614; 75, /11 HL7615; 128, /13 HL7622; 130, /13 HL7627, 2014-06), 12F, 94C, 301Y.
10/10/10 ORDERS BOMBARDIER CS300HE (PW1521G):
0 F 100 (TAY 650-15), 2 TO (TTR) 1999-04, 2 TO AIR GREECE 1999-05. 11378 ST (IRB) 2003-09; 11388, 2003-10; 11504; & 11513; 2004-06. 11522 SOLD TO (IRB) 2004-10. 11523 SOLD TO (IRB) 2005-01. 109Y.
1 FALCON 50.
4 CITATION ULTRA (JT15D-5D).
1 GULFSTREAM G-IV) (TAY 611-8) (1188, /92 HL7222), EXECUTIVE. 19F.
Click below for photos:
KAL-1-YANG HO CHO-2006-02
KAL-1-YANG HO CHO-CHMN
KAL-2-LEE JOONG HEE - PRES
KAL-3-KEN CHOI-PRES CARGO
YANG-HO CHO , CHAIRMAN & CHIEF EXECUTIVE OFFICER (CEO) (SON OF PREVIOUS CHAIRMAN), (KAL) & HANJIN GROUP (1999-04).
Yang-Ho Cho is the Chairman & Chief Executive Officer (CEO) of Korean Air (KAL), 1 of Asia's largest airlines and the world’s largest commercial airline cargo carrier. Mr Cho was named Chairman & (CEO) of (KAL) in April 1999, having served as President & (CEO) since 1992. Prior to that, he was Executive VP & (COO) of (KAL). Mr Cho began working for (KAL) as a Manager in the Americas Regional Headquarters in 1974. He worked his way up in the company ranks by continually adding various departments to his overall responsibilities (including Maintenance, Marketing, Purchasing, Information Systems, and Corporate Planning).
After receiving a bachelor's degree in Industrial Engineering from Inha University (Incheon, Korea) in 1975, Mr Cho received an MBA from the University of Southern California (USC) in 1979, and a doctoral degree in Business Administration from Inha University in 1988. In 1998, he received an honorary Doctorate degree in Aviation Business Administration from Embry Riddle Aeronautical University, Florida.
Mr Cho is also Chairman of the parent Hanjin Group (1 of the world's largest transportation conglomerates). He was named to this post in February 2003, after having served as the Group's Vice Chairman since 1996. He is also the Director of various subsidiary companies including Korea Airport Service (KAS), and (HIST). In addition to his corporate responsibilities, Mr Cho was elected Vice-Chairman of The Federation of Korean Industries (FKI) in 1996, and has held the title of honorary Consulate-General to Ireland in the Republic of Korea since 1995. He was named Chairman of the Korea-French High Level Businessmen's Club in October 2000, and has also served on the Board of Governors for the International Air Transport Association (IATA) (ITA) since elected in May 2001. In June 2016, Mr Cho was re-elected to the (IATA) Board of Governors and the Strategy & Policy Committee, each for a 3-year term at the 72nd (IATA) (AGM) in Dublin, Ireland.
He also has served as Chairman of the Korea Defense Industry Association since 2004. He has been on the (USC) Board of Trustees since 1997. He is Chairman of the board of trustees at Inha and Hankuk Aviation universities.
Mr Cho's commitment of serving the public with transportation has been widely recognized. In 2004, he received the title of "Commandeur" in the Legion D'Honneur, the highest civilian honor awarded in France. In 2005, Mr Cho was awarded the title of Mongol's Polaris, the highest civilian honor granted by the government of Mongolia.
Mr Cho is married, and has 1 son and 2 daughters.
SHIM YI-TAEK, VICE-CHAIRMAN (2004-03).
WALTER CHO, PRESIDENT (KAL).
CHANG HOON CHI, PRESIDENT & CHIEF OPERATIONS OFFICER (COO) (KAL).
KEN CHOI, PRESIDENT, CARGO BUSINESS DIVISION (2004-03).
JAE KUN KIM, PRESIDENT AIR KOREA (2008-05).
HARRY DAVID GREENBERG, (CEO), EX-(DAL), EXECUTIVE VP OPERATIONS (2000-07).
SOO BU LEE CHO, EXECUTIVE VP HANJIN HEAVY INDUSTRIES (1998-01).
Y H KIM, EXECUTIVE VP & PRESIDENT PASSENGER BUSINESS DIVISION (2004-03).
YUNG HO KIM, PRESIDENT PASSENGER BUSINESS DIVISION.
WON YOUNG LEE, PRESIDENT HANJIN CORPORATION (2004-03).
SANG MOOK SUH, PRESIDENT AEROSPACE BUSINESS DIVISION.
KWANG SA LEE, SENIOR VP MAINTENANCE & ENGINEERING (SELMPKE)
KYUNG HWAN CHANG, SENIOR VP CORPORATE STRATEGY.
JO YUN HWANG, MANAGING VP & CHIEF FINANCIAL OFFICER (CFO).
KEEHONG WOO, MANAGING VP & HEAD PASSENGER DIVISION.
S W LEE, MANAGING VP, MAINTENANCE CONTROL & LINE/BASE MAINTENANCE.
M S IM, MANAGING VP, KIMHAE HEAVY MAINTENANCE.
BYUNG SUN LEE, MANAGING VP KOREA AERO TECHNIAL INSTITUTE
(email@example.com) (SELMAKE) (1999-05).
W S JANG, MANAGING VP KIMPO MAINTENANCE CENTER (INCHEON) (2000-04).
Y K PARK, MANAGING VP (NDT) LABORATORY (SEL00SKE) (1999-02).
W S JANG, MANAGING VP KIMPO MAINTENANCE CENTER (2002-01).
JAY LEE, MANAGING VP & REGIONAL DIRECTOR, NORTH & SOUTH AMERICA (2008-01).
YONG SOON PARK, MANAGING VP EUROPE, MIDDLE EAST, & AFRICA.
M G KIM, VP SAFETY & SECURITY (2001-03).
LEE SANG-BEOM, VP LONG HAUL NETWORK.
SONG SUNGHOI, VP PASSENGER SALES.
JOHN JACKSON, VP PASSENGER MARKETING & SALES, THE AMERICAS.
John is responsible for passenger business in the Americas, including business development, e-commerce, advertising & public relations, loyalty & credit card programs, pricing, call center, network planning and pricing.
He has extensive international experience in North/South America, Asia, and Europe. He is a dual national of Ireland and the USA.
JUNG WOONG PARK, VP KIMHAE MAINTENANCE CENTER (PUSAN) 1997-05),
S N KIM, VP QUALITY ASSURANCE (firstname.lastname@example.org) (PUSMHKE) (2002-01).
Y S KANG, VP PUSAN HEAVY MAINTENANCE CENTER (PUSMHKE).
S H LEE, VP MAINTENANCE FACILITY TASK FORCE (1997-05).
J H LEE, VP KIMPO MAINTENANCE CENTER (2002-01).
H J CHO, VP MAINTENANCE PLANNING (1999-02).
K S LEE, VP POWERPLANT (email@example.com).(firstname.lastname@example.org) (2001-03).
DEREK HAN, VP CARGO - AMERICAS.
BANG SUN OH, VP INTERNATIONAL AFFAIRS & ALLIANCES.
E H BAN, GENERAL MANAGER LINE MAINTENANCE DEPT 5 (1997-05).
C I LEE, GENERAL MANAGER QUALITY ASSURANCE (QA).
CHANG HO CHAE, GENERAL MANAGER QUALITY ASSURANCE (QA) & MAINTENANCE SAFETY.
S T KIM, GENERAL MANAGER KIMPO MAINTENANCE CENTER (2000-06).
J B PARK, GENERAL MANAGER AIRCRAFT SYSTEM KIMHAE MAINTENANCE CENTER (1998-03).
K H OH, GENERAL MANAGER BASE MAINTENANCE (KIMPO) (1998-01).
C K JUNG, GENERAL MANAGER KIMPO MAINTENANCE CONTROL (1999-10).
J S LEE, GENERAL MANAGER ENGINEERING DEPT (POWERPLANT ENGINEERING) (email@example.com) (SELMAKE) (2001-02).
J H CHO, GENERAL MANAGER INCHEON PRODUCTION ENGINEERING (2001-03).
SONG BO YOUNG, GENERAL MANAGER NORTH AMERICA.
JOHN JACKSON, NORTH AMERICAN MARKETING DIRECTOR.
S W LEE, MANAGER PRODUCTION ENGINEERING TEAM (KIMPO)
(FORMAL: firstname.lastname@example.org) (PERSONAL: email@example.com).
JASON KIM, UK & REGIONAL MANAGER (BASED IN LONDON PICCADILLY) (2013-05).