AirAsia joins budget airline boom in Korea

03 August 2010

While low-cost carriers are gearing up to provide affordable air travel for budget-savvy tourists, AirAsia seeks to lead the way by opening up a new route via Seoul.

AirAsia, Asia’s largest low-fare airline, announced at a press conference on Monday its newest international route starting Nov. 1, which will connect Kuala Lumpur and Seoul.

To mark the launch of its latest route, the Malaysian company introduced a promotional round-trip fare of 120,000 won ($102.30) including all taxes and fees, for the travel period from Nov. 1 to Aug. 11, 2011, for those who book tickets on its website between Aug. 4 and Aug. 8.

After the promotional period, travelers will be able to purchase tickets for 25 to 30 percent lower than traditional airlines charge, depending on their purchase date, for the daily operation.

It took more than a year for the airline to earn an approval from the government, noted Azran Osman-Rani, CEO of AirAsia X, AirAsia’s long-haul affiliate.

“Seoul has been our priority market for the long-haul destination since 2007,” he said. “Malaysians have gone crazy about the Korean Wave. We couldn’t wait to launch this route for so long.”

According to an online survey conducted by AirAsia on social networking websites such as Facebook and Twitter, more than 2 million customers picked Seoul as the No. 1 destination they wish the airline to fly to.　

Seoul is the eleventh destination for the Malaysian company followed by cities in Australia, India, Taiwan, China and the U.K.　

AirAsia’s CEO Azran Osman-Rani poses with the Korea Tourism Organization’s president Lee Cham (fourth from right) at a press conference in Seoul on Monday.

Established in 1993, AirAsia was named the world’s best low-cost airline for two years in a row in 2009 and 2010 by Skytrax, a U.K.-based aviation research firm.　

Currently, AirAsia and AirAsia X operate more than 132 domestic and international flights collectively through a fleet of 94 aircraft.

The market for low-fare flights has grown over the past several years with an increasing number of budget carriers flying across Asia Pacific, enabling cost-sensitive customers to enjoy air travel more affordably.

Major players in the Asian sector such as Tiger Air, Thai Air and AirAsia have brought challenges to legacy European and American carriers, offering no-frills service at dramatically reduced prices, with a wide variety of options on in-flight services.

In spite of growing global demand, Korea has not been an easy market for budget carriers during the past few years.

In 2008, Singaporean Tiger Air initially intended to fly from Korea to China, Japan and Russia beginning in August last year, but eventually withdrew the plan after delays in its application process, due to the global economic slowdown and regulatory uncertainties.

Organizations like the Center for Asia Pacific Aviation argued that Korean government protectionism has been a major hurdle for the market, as the Ministry of Land, Transport and Maritime Affairs failed to reject a request brought by national airlines to protect themselves from competition with overseas companies in 2008.

Meanwhile, Yeongnam Air and Hansung Airlines, two Korean low-cost carriers, suspended operations in 2008, citing rising competition and lack of demand.

By Shin Hyon-hee (heeshin@heraldm.com)

TheKoreaHerald