Air Premia, the Seoul Incheon-based airline, is reportedly finalizing a lease agreement with Korean Air for four Boeing 787-9 aircraft, a strategic move aimed at bolstering its operations across North America. This development, as exclusively reported by South Korea’s News Tomato, comes amidst regulatory scrutiny from United States antitrust authorities concerning the proposed merger between Korean Air and Asiana Airlines.
The lease deal emerges as a tactical response to address capacity constraints that have limited Air Premia’s ability to expand its service offerings between South Korea and the United States. Currently, Air Premia operates a modest schedule to the U.S., including flights to Honolulu, New York Newark, and Los Angeles International, with plans to initiate service to San Francisco in May. The addition of four 787-9s from Korean Air is poised to significantly enhance Air Premia’s footprint in the lucrative trans-Pacific market.
Korean Air, a dominant player in the South Korea-U.S. aviation market, operates an extensive network of flights to major U.S. destinations. The specifics of how Air Premia will integrate the leased aircraft into its existing routes or if it will take over certain frequencies from Korean Air remain to be clarified. This strategic partnership underscores the airlines’ commitment to maintaining competitive balance and service diversity in the face of regulatory concerns.
The merger between Korean Air and Asiana Airlines has faced scrutiny from U.S. antitrust authorities due to the combined entity’s potential market dominance. Korean Air and Asiana Airlines collectively hold a substantial market share on the South Korea-U.S. route, prompting regulatory suggestions that the merger might be blocked without significant concessions. The lease agreement with Air Premia is seen as a move to alleviate these concerns by redistributing capacity and ensuring competitive dynamics remain intact.
This arrangement with Air Premia mirrors a similar strategy employed by Korean Air in its deal with t’way Air, aimed at addressing European Commission competition concerns. In that agreement, t’way Air agreed to operate widebody services to Europe using A330-200s loaned from Korean Air, further demonstrating the lengths to which airlines are willing to go to secure regulatory approval for consolidation activities.
The impending lease of 787-9 aircraft to Air Premia from Korean Air signifies a critical step in adjusting the competitive landscape of international aviation, ensuring that market dynamics and consumer choices are preserved amidst ongoing industry consolidations. As Air Premia gears up to expand its North American operations, the aviation community watches closely to see how this strategic partnership unfolds and its impact on the broader trans-Pacific travel market.
