Although Korean Air showed unexpected performance last year even in the aftermath of Corona 19, the low-cost airline (LCC) had its worst year.



LCCs such as Asiana Airlines, Jeju Air, and T'way Air are expected to announce their annual results before and after the Lunar New Year holidays.



Jeju Air is expected to announce its results on the 8th and the rest of the airlines on the 16th.



Korean Air, the number one large airline in Korea (FSC), released a relatively good report last year with sales of KRW 7.45 trillion and operating profit of KRW 238.3 billion.



Compared to the previous year, sales decreased by 40% and operating profit decreased by 17%, but it is evaluated that the company made a profit by making a'alone surplus' amid the marching losses of global airlines.



On the other hand, Jin Air, which announced its results on the same day, recorded the largest deficit since its foundation in 2008.



Jin Air recorded sales of 271.8 billion won and operating loss of 184.7 billion won last year.



Compared to the previous year, sales decreased by 70.1% and operating losses increased by 278%.



The situation of other LCCs ahead of their earnings announcement is expected to be the same as Jin Air.



According to the results of compile the forecasts of five securities companies that Yonhap Infomax released a report within the last month, Jeju Air's consensus on operating losses last year (average forecast) was KRW 288.8 billion.



The sales are estimated to be 385.7 billion won, a 72% decrease from the previous year.



Although it is not an LCC, Asiana Airlines is not expected to come out of the deficit swamp.



Eugene Investment & Securities forecasts that Asiana Airlines will generate KRW 4.318 trillion in sales and KRW 227.2 billion in operating losses last year.



Sales decreased by 42% and operating loss by 48% compared to the previous year.



Korean Air's'alone surplus' amid the coronavirus crisis is due to offsetting the decline in passenger demand by expanding cargo transportation.



Korean Air's passenger sales decreased by 74% from the previous year (7,676.7 billion won) to KRW 2.5.2 trillion, but cargo sales rose by 66% from KRW 2.5575 billion in 2019 to KRW 4.25 trillion. Increased.



It is analyzed that the increase in cargo sales was driven by the introduction of idle passenger planes for cargo transportation and the increase in the utilization rate of 23 cargo planes.



On the other hand, LCCs, which relied on passenger transportation for most of their sales, did not find a breakthrough in response to the decrease in passenger demand caused by Corona 19.



As domestic LCCs do not have separate cargo planes, they have increased incidental cargo sales by transporting cargo through the'belly' (cargo compartment under the passenger plane).



According to the Ministry of Land, Infrastructure and Transport's aviation portal, last year's LCC cargo was 3381 tons with Jeju Air, 29,000 tons with Jin Air, and 24,000,533 tons with T'way Air.



Compared with Jeju Air's 10,820 tons, Jin Air's 8,225 tons, and T'way Air's 58,755 tons in 2019, cargo traffic has been reduced by more than half due to the decrease in passenger flight operations.



Jin Air converted a passenger plane into a freighter, and Jeju Air and T'way Air started'in-flight transportation', which loads cargo on the cabin seats. However, due to irregular routes, cargo sales performance was poor.



The problem is that this year, the situation has not changed significantly from last year, and there is no other exit strategy.



The specialty of vaccine transportation following this year's corona vaccination will not be of great help to LCCs, which have poor professional transportation capabilities such as cold chain (refrigerated distribution).



The International Air Transport Association predicts that this year's passenger demand will remain at 50% of 2019.



Travel demand is not expected to recover until 2022, when autoimmunity is formed by the spread of the vaccine.



(Photo = Yonhap News)