November 23, 2024

• 

Korean Air Chair Walter Cho speaks during a groundbreaking ceremony for Korean Air's new engine maintenance plant in Incheon, March 14. (Yonhap)

Korean Air Chair and CEO Walter Cho secured his position as a board member of the national flag carrier and pledged to steer the company toward successful integration with Asiana Airlines this year, marking a leap toward establishing a megacarrier.

Cho received an 85 percent endorsement from participating shareholders during their annual meeting on Thursday.

"Despite the prolonged timeline, the merger between Korean Air and Asiana Airlines will be a substantial driver of long-term growth," Cho said in a written statement to shareholders on Thursday. "The ongoing business review for the acquisition of Asiana Airlines gained approval from Japan in January and the EU in February, with only the US' review pending. Our company is diligently preparing to expedite the review process and ensure a successful integration with Asiana Airlines."

Despite the divestment of Asiana Airlines' cargo freighter business and the transfer of specific European routes on the way to comply with the EU's conditional approval, the industry foresees that the merger will propel the company to the list of the global top 10 air carriers.

Korean Air also aims to resolve concerns over potential route monopolies raised by the US Department of Justice through consultations by June, seeking approval within the year.

Meanwhile, a day prior to the shareholders' meeting, Cho convened a face-to-face town hall gathering where he openly engaged with Korean Air employees and addressed their concerns.

According to industry sources, the meeting was held at the Korean Air headquarters, where approximately 100 employees voluntarily participated and reportedly queried Cho on various aspects of the impending merger.

In response, the chair assured them of the company's commitment to securing favorable outcomes from US regulation authorities, which is regarded the final hurdle in the process.

Cho also emphasized that Korean Air executives would actively integrate with Asiana Airlines post-merger in a manner that respects both companies' cultures, given their historical rivalry.

Following the shareholders meeting Thursday, Korean Air announced that it would sign a significant contract with Airbus for the acquisition of 33 cutting-edge A350 airplanes.

The deal, valued at some $13.7 billion, comprises 27 A350-1000s and six A350-900s, marking a strategic move to bolster the airline's long-term fleet operations while gradually phasing out older Korean Air aircraft.

The A350-1000, the largest variant in the A350 family, offers a seating capacity of up to 410 passengers in its standard three-class configuration.

Leveraging advanced composite materials, the aircraft can achieve up to a 25 percent reduction in fuel consumption and carbon emissions compared to similarly sized predecessors.

With capabilities tailored for long-haul routes such as Incheon-New York, the new aircraft is to bolster Korean Air's operational efficiency and service quality.

Korean Air announced that the procurement of the A350s is part of the airline's commitment to sustainability initiatives and serves as the groundwork for a seamless integration of Asiana Airlines.

In addition to securing 33 A350s, Korean Air has outlined plans to introduce 50 Airbus A321neos, 10 Boeing 787-9s, 20 Boeing 787-10s and 30 Boeing 737-8s.

By Kim Hae-yeon (hykim@heraldcorp.com)
The Korea Herald