Bloomberg News

Korean Air Plans to Add North America Capacity as A380s Arrive

March 24, 2013

Korean Air Plans to Add North America Capacity as A380s Arrive

Korean Air Lines Co. expects passenger demand to increase 3.9 percent this year as economic growth in the U.S. and Asia, help mask a downturn in European demand. Photographer: Jerome Favre/Bloomberg

Korean Air Lines Co., the country’s biggest carrier, plans to increase flights to the U.S. and Canada this year as it adds two more Airbus SAS A380 superjumbos to its fleet.

The carrier will add nine planes this year to its fleet, enabling more flights to Seattle, Las Vegas, Vancouver and Chicago, Woo Kee Hong, senior vice president of strategy and planning at Korean Air, said in an interview in Seoul on March 22. The company will increase services to Southeast Asia, China and Japan while not adding routes to Europe, Woo said.

Korean Air, which counts Samsung Electronics Co. as its biggest source of revenue, expects passenger demand to increase 3.9 percent this year as economic growth in the U.S. and Asia, help mask a downturn in European demand. Airlines globally will exceed last year’s earnings by about 40 percent in 2013 as travel outlook improves for the industry, the International Air Transport Association said last week.

“We see a lot of potential connecting the U.S. and Asia,” Woo said.

Korean Air plans to add more seats between Atlanta and Seoul in August, by operating the A380 plane for part of its 10 weekly flights, Woo said. The company had 146 planes on its fleet at the end of December, including six A380s and 32 Boeing Co. (BA:US) 777s.

The airline also plans to retire its 747 aircraft as it adds more fuel-efficient planes, Woo said. Carriers, including Singapore Airlines Ltd. and Deutsche Lufthansa AG, are ordering fuel-efficient jets as kerosene costs have jumped 39 percent over the past three years.

Capacity to European cities will remain unchanged because of mounting competition with Middle East carriers, Woo said.

“Flying between Asia and Europe has become extremely competitive,” Woo said. “It’s not only the Middle Eastern carriers, but the airlines in Europe are also offering very competitive fares.”

To contact the reporter on this story: Kyunghee Park in Singapore at kpark3@bloomberg.net

To contact the editor responsible for this story: Anand Krishnamoorthy at anandk@bloomberg.net


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