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Seoul approves business licences for three new carriers

South Korea’s transport ministry has approved business licences for Aero K, Fly Gangwon and Air Premia, allowing them to move forward and apply for air operator’s certificates.

The ministry states that all three carriers met the requirements around executive qualifications, capital and aircraft, to move to the AOC application stage. They now have two years to start operations.

Each carrier will also be required to maintain operations at their base airport for three years before expanding.

Cheongju-based Aero K won approval after its second attempt, having increased its capitalisation to W48 billion ($42.7 million), from W15 billion in 2017.

It plans to operate as a low-cost carrier and have six Airbus A320s in service by 2022, which it will deploy on 11 routes from Cheongju to Vietnam and Japan.

Cirium schedules data shows that the carrier is likely to face tough competition, with Jin Air, Jeju Air and Eastar Jet already operating a number of services from Cheongju International airport to destinations in Japan, Taiwan and China.

The startup had placed orders for eight A320s in 2017, but the rejection of its initial licence application resulted in it reducing that order to three aircraft in mid-2018.

Fly Gangwon plans to launch flights on 25 routes from Yangyang to China, Japan and the Philippines using Boeing 737-800s, with plans for the fleet to grow to nine aircraft by 2022. It has a registered capital of W37.8 billion.

The prospective low-cost carrier has had its licence rejected twice before, with a lack of capital cited as the main concern in both instances. Since its last rejection in 2017, the Gangwon provincial government has reportedly stepped in to provide additional support.

Once it starts operations, the carrier will be a major boost for Yangyang, which Cirium schedules data shows is only served by Air Philip’s thrice-weekly Embraer ERJ-145 services to Kitakyushu.

Meanwhile, hybrid carrier Air Premia recently selected the Boeing 787-9 as the sole type for its fleet. The ministry says it plans to operate seven of the type by 2022 and fly to nine destinations in Vietnam, Canada and the United States.

The ministry adds that awarding the licences will “encourage competition and innovation in our aviation market”.

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