Korean Air Seeks to Buy Asiana (Recent News Article)
 

From the Korea Times: https://www.koreatimes.co.kr/www/tec...74_299258.html

I posted this in Korean Air, too, but of course different alliance, different customers, slightly different audience so I think it's ok to post twice.

Now I know here will miss Asiana service and OZ Club etc, but overall I mean the market wouldn't be too damaged by it....or would it? Thoughts?

I really prefer Star Alliance over Skyteam... I hope this doesn't come to pass.

In the short-term, probably not. However, if KE ends up having a near monopoly on international flights (I am not familiar with what's available in the Korean domestic market), I can't imagine it being a good thing for the market.

LAX

I've argued that South Korea needs 2 majors, given ICN's prominence and the strong business climate here. It seems like Korean Air would be too massive without a major divestiture, which then feels like it's pointless except to maybe bailout OZ's shareholders to some degree. I think it would serve the market better to have OZ survive as even a 3rd tier international long haul carrier, because I can't see a Korean Air with 60% of all Korean originated flights being good for customers, corporate or retail. But I am no air business expert, so...grain of salt.

As I mentioned in KE Forum, of course I know in my heart Star Alliance overall is the better alliance, but coming from Atlanta/Southeast I am SkyTeam captive haha

Re: I understand the point of no monopolies, etc. and the Korean government is VERY protective in this regard....and of course shareholders will be pissed

But I just mean logically from a consumer perspective - Asiana didn't really offer much difference from KE IMO and I mean their pricing was exactly the same. Not like they were diversifying much.

Of course there is all their LCC operation that adds to the complexity...

The Korean Herald said Korean is purchasing Asiana: Korean Air to buy Asiana, emerges as world's 10th-largest airline

"Korean Air Lines Co., South Korea's biggest carrier, said Monday that it will buy its smaller local rival Asiana Airlines Inc. in a deal valued at 1.8 trillion won ($1.62 billion) that would create the world's 10th-biggest airline by fleets.

Korean Air plans to buy new shares worth 1.5 trillion won to be sold by Asiana, and buy bonds to be floated by the smaller carrier, the company said in a regulatory filing.

Korean Air, currently the world's 18th largest, will acquire a 30.77 percent stake in Asiana from the debt-laden carrier's creditors led by the Korea Development Bank (KDB)."

Not positive for staying in Star Alliance. Asiana always had good availability for award seats.

From a FFP standpoint, I'm not a fan of this merger. OZ has a better FFP for redemptions, especially with KE's upcoming devaluation next year. *G status is more useful than STE+ status internationally, specifically for lounge access. As someone who travels to Korea quite often to visit family, I always liked how there were two options outside of the US-airlines when I would travel between the US and ICN. So, I would hate to see this no longer be an option.

Hopefully, the SK government rejects this merger since it would give KE a monopoly on long-haul and cargo to/from ICN.

As just OZ maybe not much. Pricing is similar, connections were similar. Service was very good on both in economy, in my experience.

But as *A it's so obviously better, IMHO. And they are going to both raise prices and cut benefits of the FFP if they are the monopoly carrier for Korea. It would be a miracle if they didn't, and I don't believe in miracles.

So even if OZ didn't offer much compared to KE in a world where they both exist, I can't see how (or why, from their point of view) a dominant KE will offer more than what OZ offers now.

I just got my OZ credit card, and was halfway to Diamond. Now I have to find a new airline, again. :(

Price was similar due to competition. Monopoly routes (ICN-ATL/DFW/BOS) are several hundred dollars more expensive than competing routes (ICN-JFK/LAX). We'll see price hike from NY and LA soon now that all routes will become monopoly. KE charges premium over UA or AA many times, so the argument denying monopoly and saying that KE is anyhow competing against foreign airlines is only partially true.

Go to TK.

TK or A3 are the likely choices. Of course it means I have to start over again.

I feel A3 really only works if you're able to squeeze in those 2+4 A3 flights during first year, otherwise, it's no better than other programs is it?