"Seoul Incheon International Airport"

In a move set to reshape the Korean air cargo landscape, Korean Air has named Air Incheon as the preferred bidder for the acquisition of Asiana Airlines’ global cargo freighter business.

The decision was finalized during a board meeting on 17 June 2024. It marks a further significant step towards Korean Air’s complete takeover of Asiana Airlines.

Asiana’s Established Cargo Presence

Asiana Airlines boasts a well-established cargo division, playing a significant role in the Korean air freight industry.

Their freighter network stretches across Asia, North America, and Europe. It caters to a diverse clientele with a range of cargo needs.

The airline utilizes a fleet of modern cargo aircraft, including Boeing 747-400 Freighters and mid-sized Boeing 767 Freighters. These widebody aircraft offer efficient and reliable cargo transportation solutions.

However, the ongoing merger with Korean Air necessitated the divestment of the cargo business. This was necessary to address competition concerns raised by regulatory bodies.

This divestiture presented an opportunity for a new player to emerge as a major force in Korean air cargo.

Air Incheon: Korea’s All-Cargo Airline

Founded in 2012, Air Incheon quickly established itself as Korea’s sole all-cargo airline. Its operations have primarily focused on regional routes within Asia.

The operator is strategically positioned near Incheon International Airport, a major cargo hub in the region.

Air Incheon utilizes a fleet of modern freighter aircraft, including the efficient Boeing 737-800 Freighters, well-suited for shorter regional routes.

A Strategic Acquisition for Air Incheon

The acquisition of Asiana Airlines’ cargo unit presents a strategic opportunity for Air Incheon to significantly expand its reach and capabilities.

Gaining access to Asiana’s extensive long-haul network to the Americas and Europe will allow Air Incheon to cater to a wider range of customers and destinations.

Additionally, incorporating Asiana’s fleet of larger Boeing 747 Freighters will provide Air Incheon with the capacity to handle larger cargo volumes. This means that it will be able to compete more effectively in the long-haul market.

This acquisition is expected to solidify Air Incheon’s position as a dominant player in the Korean air cargo industry, potentially challenging Korean Air’s market share.

The Road Ahead: Negotiations and Regulatory Approval

Korean Air and Air Incheon are expected to finalize contract details in July, paving the way for a framework agreement.

However, the deal hinges on securing approval from the European Commission, which previously expressed concerns about competition in the air cargo market due to the initial merger.

Korean Air has emphasized its commitment to a swift and adaptable negotiation process to finalize the sale and expedite the full acquisition of Asiana Airlines.

The successful completion of this deal will significantly reshape the Korean air cargo landscape, potentially leading to increased competition and improved services for customers.

Industry Implications: A Reshaped Landscape

The acquisition of Asiana’s cargo unit by Air Incheon is likely to have a ripple effect on the Korean air cargo industry.

The emergence of a stronger Air Incheon could potentially lead to increased competition on both regional and long-haul routes.

This competition could benefit customers by driving down prices and potentially leading to improved services and innovation within the industry.

However, there are also concerns about the potential impact on smaller players in the market. The consolidation of resources under Air Incheon could create a dominant force. This potentially makes it more challenging for smaller airlines to compete effectively.

Overall, the acquisition marks a significant development in the Korean air cargo industry. The coming months will be crucial in determining the final outcome and its long-term implications for the various stakeholders involved.

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Australian low-cost airline Jetstar is bolstering international travel from southeast Queensland with this week’s introduction of two new flight routes from Brisbane.

Thursday 1 February saw the inauguration of a new service between Brisbane and Seoul in South Korea, followed by the inaugural flight between Brisbane and Osaka, Japan, today.

These network additions redefine travel options for thousands of passengers from Queensland, offering convenient and affordable direct connections to vibrant Asian destinations.

Boeing 787 Dreamliner

Utilizing its modern fleet of Boeing 787 Dreamliners, Jetstar will operate three return flights weekly between Brisbane and Seoul’s Incheon International Airport, along with four weekly return flights connecting Brisbane and Osaka’s Kansai International Airport.

Notably, the Brisbane to Osaka route marks the introduction of the only direct service between these two dynamic cities, streamlining travel and enhancing accessibility for passengers.

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Economic Implications

The introduction of these new routes signifies more than just expanded travel options; it represents a significant economic opportunity for southeast Queensland.

With projections estimating a combined annual passenger volume of up to 240,000 individuals, these flights are anticipated to inject millions of dollars into the region’s tourism sector annually.

Such growth is a testament to Queensland’s appeal as a premier travel destination and underscores the importance of strategic partnerships in driving economic prosperity.

These key additions to Jetstar’s route network have been made possible through collaborative efforts, including support from Queensland’s Attracting Aviation Investment Fund (AAIF).

This joint initiative between the government and key stakeholders aims to stimulate Queensland’s visitor economy by enhancing air connectivity and promoting tourism development.

The successful partnership between Jetstar and Brisbane Airport further underscores the commitment to expanding travel opportunities and fostering economic growth in the region.

Anticipated Demand

Jetstar Group CEO, Stephanie Tully, expresses confidence in the viability of these new routes, citing strong demand for international travel to and from southeast Queensland.

 With inbound visitation from South Korea and Japan expected to contribute significantly to the region’s economy, these routes offer unprecedented access to diverse cultural experiences and economic opportunities.

Moreover, Queenslanders stand to benefit from over 240,000 low-fare seats across the two routes, empowering them to explore new destinations with unparalleled affordability and convenience.

Stakeholder Perspectives

Gert-Jan de Graaff, CEO of Brisbane Airport, hails the introduction of these new routes as a boon for tourism and job creation in Queensland.

Emphasizing the collaborative efforts between Jetstar and the airport, he highlights the substantial increase in affordable fare options, further enhancing Queensland’s appeal as a global travel hub.

Echoing this sentiment, Queensland Tourism Minister, Michael Healy, underscores the strategic importance of these new services in driving tourist arrivals and economic growth.

With South Korea emerging as a key growth market and Japan representing a significant source of visitor expenditure, these routes are poised to capitalize on burgeoning travel trends and unlock new opportunities for Queensland’s tourism sector.

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Australian low-cost carrier Jetstar has announced a new partnership with Brisbane Airport, which will result in the launch of an additional half a million low-fare seats between Brisbane and international destinations.

This move aims to bring in thousands of tourists to southeast Queensland annually. As part of this deal, Jetstar will begin operating direct flights between Brisbane and Tokyo (Narita), Osaka, and Seoul.

The plan is to take advantage of the airport services that align with Jetstar’s low-cost operating model.

International flight increases from Brisbane

The airline will also increase the frequency of its existing services from Brisbane to Bali and Brisbane to Auckland. Here are the details of the new flights:

Japan:

• Starting from October 31, 2023, there will be five return flights per week between Brisbane and Tokyo (Narita), increasing to a daily service from December 3, 2023.
• From February 2, 2024, there will be four return services per week between Brisbane and Osaka (Kansai).
• Over 380,000 seats will be available each year between Brisbane and the two Japanese destinations.

South Korea:

• From February 1, 2024, there will be three return flights per week between Brisbane and Seoul (Incheon).
• More than 100,000 seats will be offered annually between Brisbane and the South Korean capital.

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Bali:

• From February 1, 2024, the number of weekly return services between Brisbane and Bali (Denpasar) will increase from seven to ten.
• The introduction of Jetstar’s newest aircraft, the Airbus A321neo LR (NEO), has enabled this increased frequency.

New Zealand:

• Starting from October 29, 2023, the number of weekly return services between Brisbane and Auckland will increase from four to daily, adding over 90,000 seats per year.
• From February 1, 2024, the NEO aircraft will also be deployed on this route.

Supported by Queensland investment fund

The services between Brisbane and Osaka, Seoul, and Auckland are supported by Queensland’s Attracting Aviation Investment Fund (AAIF), a joint initiative of the Government and the airport to boost the state’s visitor economy.

To accommodate the new Tokyo (Narita) flight service, Jetstar will cease its operations from the Gold Coast to Tokyo (Narita) starting from October 29, 2023.

This change allows Jetstar to consolidate widebody aircraft flying and related engineering resources in Brisbane, strengthening their operations.

Partnership comments

Jetstar Group CEO, Stephanie Tully, expressed enthusiasm about the new agreement, stating that it will bring thousands of new visitors to Queensland and invigorate the local economy.

She also mentioned that Jetstar’s low fares have a history of encouraging travel, and this expansion will attract more tourists to the sunshine state from Japan, South Korea, and New Zealand.

Tully thanked Brisbane Airport and the Queensland Government for their support through the Attracting Aviation Investment Fund, which facilitates the return of overseas tourists.

Brisbane Airport CEO, Gert-Jan de Graaff, praised the expansion of services and highlighted that it represents the largest increase in low-fare seats for Queenslanders and visitors from key markets.

He also mentioned the airport’s commitment to reducing noise impact, with the introduction of next-generation, quieter, and fuel-efficient aircraft like the Airbus A321neo on these new flights.