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By Jun Ji-hye
Korea's low-cost carrier (LCC) industry is bracing for major changes this year as two newcomers are ready to join the market, while a giant budget airline is set to emerge through a merger between three low-cost carriers.
The two new entrants are Air Premia and Aero K.
According to industry sources, Air Premia is expected to receive its air operator's certificate (AOC) from the Ministry of Land, Infrastructure and Transport and acquire Boeing 787-9 planes next month.
The transport ministry grants an AOC after verifying a carrier's capability to provide safe services. Air Premia received its license to operate air transport services back in March 2019.
The deliveries of Boeing aircraft and other procedures to launch services have been delayed due to the prolonged COVID-19 pandemic, but Air Premia may be able to begin its inaugural service within March as the carrier is in the final stages of receiving its AOC, according to sources.
"We are planning to launch our inaugural service to a Southeast Asian country, and then expand our routes to Los Angeles and Silicon Valley, among others," an Air Premia official said.
Aero K received its AOC last month and is set to begin operations next month, flying a 180-seat Airbus A320 on the Cheongju-Jeju route.
The carrier also plans to operate more international routes after acquiring two more Airbus planes.
Fly Gangwon already began offering flights on the Yangyang-Jeju route in November 2019, and added the Yangyang-Gimpo and Yangyang-Daegu routes later.
Meanwhile, Korean Air's plan to take over Asiana Airlines will bring about a mega merger between the budget carrier brands of the two full-service flyers. Jin Air is a subsidiary of Korean Air, while Air Seoul and Air Busan belong to Asiana.
As of last year, the three LCCs accounted for a combined market share of 44 percent, beating Jeju Air, which is currently the largest budget carrier.
Industry officials noted, however, that the ongoing COVID-19 crisis will remain as a variable in the reshaping of the LCC industry as the continuation of the pandemic could threaten the very survival of LCCs, especially new players.
As the pandemic has caused international travel to plummet, existing LCCs have turned their eyes on domestic routes, intensifying competition in the local budget airline market.
"An intense price-cutting race among LCCs amid the pandemic could make things more difficult for new budget carriers," an official at a Seoul-based budget airline said on condition of anonymity.
