The Ministry of Land, Infrastructure and Transport emphasized on the 16th that it is an inevitable option for overcoming the crisis in the aviation industry caused by Corona 19 in connection with Korean Air's acquisition of Asiana Airlines.
In the reference material distributed that day, the Ministry of Land, Transport and Maritime Affairs made such a statement about the background of turning to the acquisition promotion in the position that it had to maintain the two major airlines (FSC) of Korean Air and Asiana Airlines.
The Ministry of Land, Transport and Maritime Affairs said, "On the premise that Asiana Airlines' normal maintenance is possible, the Ministry of Land, Infrastructure, and Transport was the opinion that two FSC systems are needed to maintain the network of the Korean aviation industry."
“However, the management of Asiana Airlines is very difficult, and the sale to a third party is uncertain.” “With the continuation of Corona 19, the voluntary acquisition of Korean Air, which is in the same industry, is a key to overcoming the crisis and development of the aviation industry. I thought it was an opportunity,” he explained.
Regarding the point that it is necessary to maintain the current creditor management system as there is a possibility that air demand will recover through the development of the Corona 19 vaccine, he said, "It seems that the recovery of the business environment will take a long time."
He added, "Amid the continuing slump in the business environment of the aviation industry, the merger and acquisition (M&A) of both FSCs is inevitable in terms of ensuring that the Korean aviation industry is not insolvent."
Regarding the monopoly of the two companies' M&As and concerns such as an increase in airfare, he said, "It is expected that there will be no rapid fare increase due to competition with foreign airlines and low-cost airlines (LCC)." .
The Ministry of Land, Transport and Maritime Affairs is also considering a plan to increase the number of points in the evaluation item for'Single Route Fare Evaluation' when allocating transportation rights, and to create a new plan to penalize excessive fares when allocating slots.
Regarding the concern about manpower restructuring when the M&A is concluded, he emphasized that M&A will be promoted according to the principle of employment maintenance.
The Ministry of Land, Infrastructure and Transport said, "Under the principle of employment maintenance, this M&A is underway in the direction of expanding consumer options by investing extra manpower to develop new routes and improve the quality of aviation services, to secure a tight flight schedule, and to pioneer unserviced routes." Delivered.
In addition, the Ministry of Land, Infrastructure and Transport believes that, rather than the current situation in which the business environment and employment are unstable due to capital encroachment and M&A failure with HDC Hyundai Development Division, this M&A will help secure employment.
Regarding the point that this M&A will in fact give preferential treatment to Korean Air, "Saneun will participate in this integration work as a direct shareholder, inducing the will of the owner and management for responsible management, and faithfully performing the monitoring role to ensure sound management. "I said.
Some of the industry also pointed out that this M&A may lead to other LCCs such as Jeju Air and T'way Air being out of competition, and that a reorganization of the aviation industry is inevitable.
Regarding this, the Ministry of Land, Infrastructure and Transport added, "If M&A of airlines is voluntarily carried out, we will take a closer look so that smooth results can be obtained in terms of the development of the aviation industry."
(Photo = Yonhap News)