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Photo courtesy of Yonhap News |
[Alpha Biz= Kim Jisun] Korean Air will enter an emergency management mode starting next month as jet fuel prices soar and the Korean won weakens sharply against the U.S. dollar בעקבות escalating geopolitical tensions in the Middle East. Budget carriers under the Hanjin Group—including Jin Air, Air Busan, and Air Seoul—have also declared emergency measures, bringing the number of Korean airlines in crisis response mode to six out of 12.
According to industry sources on March 31, Korean Air announced in an internal memo from Vice Chairman Woo Kee-hong that it will implement company-wide emergency management measures beginning in April.
Jin Air also issued a similar notice under CEO Park Byung-ryul, emphasizing the need to “maximize profitability and minimize unnecessary expenditures,” while calling for broader operational restructuring beyond simple cost-cutting.
Air Busan and Air Seoul likewise confirmed that they will adopt emergency management systems starting in April, stressing that safety will remain their top priority despite the cost pressures.
The move comes as jet fuel prices have surged dramatically following the Middle East conflict. According to S&P Global, aviation fuel prices in Asia and Oceania reached 574.47 cents per gallon as of March 30, marking a 157% increase compared to 223.75 cents on February 27.
Fuel costs typically account for around 30% of an airline’s total expenses. The surge in oil prices, combined with a sharp rise in the KRW/USD exchange rate, has significantly worsened cost structures across the industry. Airlines face additional pressure as key expenses—including aircraft leasing and maintenance—are denominated in U.S. dollars.
The wave of emergency declarations began earlier this month, with T’way Air announcing such measures on March 16, followed by Asiana Airlines on March 25. Asiana has also begun reducing flight operations, cutting a total of 14 round-trip flights across four routes to China and Cambodia for April and May.
Industry observers expect the emergency measures to spread further if the geopolitical situation persists.
알파경제 Kim Jisun Reporter(stockmk2020@alphabiz.co.kr)
