South Korea may be too crowded a market

AirAsia's CEO, Tony Fernandes, was quoted a couple of years ago - while on a trip to South Korea - that the country would be an ideal market for a new low-cost carrier.
He said this because at that time there were only two domestic airlines - both full service carriers - and South Korea has some good short-haul domestic and international routes, ideal for the Boeing 737s and Airbus A320s that low-cost carriers tend to operate.
Today it seems South Korea is no longer an ideal market for a new airline starting out simply because its now too crowded.
The incumbent full-service carriers Korean Air and Asiana Airlines are establishing low-cost carriers of their own.
There are two small regional operators - Han Sung Airlines and Jeju Air - looking to expand.
Plus there are three new airlines starting - Kostar Airlines, Incheon Tiger Yeongnam Air.
I can't see how all these carriers can survice and that can only mean one thing - future consolidation.

Fokker 100 operators to head Down Under

Airlines in Asia Pacific that operate Fokker 100 aircraft will soon have to make the long trek down to Melbourne, Australia if they are to put their pilots through simulator training.
Alteon Training in Singapore has the only Fokker 100 simulator in Asia-Pacific and has just sold it to the Ansett Flight Simulator Centre in Melbourne.
The last day it will be avaliable in Singapore is 5 May, says Alteon Training Singapore director of sales and marketing Chris Bunning.
He says the reason the Fokker 100 simulator is being sold is to make room because later this year Alteon Training Singapore will be adding a Boeing 787 simulator.
But whether there is demand this year for 787 simulator training is highly unlikely considering the first 787 is only due to be delivered late next year.
Its also surprising that Alteon Training has no room in its Singapore centre to house both the 787 and Fokker 100 simulator considering the centre was only built a couple of years ago and it always knew it would be adding 787 simulators later on.
Having the Fokker 100 simulator relocated to Melbourne, supposedly hasn't gone down too well with some of the Fokker 100 operators in the region.
Mandarin Airlines in Taiwan, for example, is understood to be one of the carriers that is not too pleased about having to travel so far for simulator training.
This week I spoke to Kostar Airlines - a new airline in South Korea that plans to launch in August using Fokker 100s - and they told me they were looking to send their pilots to the US or Europe for simulator training rather than travelling Down Under.
The other Fokker 100 operators in Asia Pacific are: Air Niugini (Papua New Guinea), Air Bagan (Myanmar), Aero Mongolia, Alliance Air (Australia), Cosmic Air (Nepal), Mandarin Airlines (Taiwan), Merpati Nusantara (Indonesia), Skywest Airlines (Australia) and Transwisata Prima Aviation (Indonesia).
Another new airline in South Korea called Yeongnam Air and a carrier in Western Australia called Network Aviation Australia also plan to operate Fokker 100s.

South Korea to become crowded airline market

South Korea suddenly looks set to become a very crowded market due to a plethora of new start-ups.

Korean Air and Asiana have traditionally controlled the market and then there are two much smaller carriers - Han Sung Airlines and Jeju Air - which each operate turboprops.

But Singapore's Tiger Airways plans to launch a low-cost carrier called Tiger Incheon in joint venture partnership with the Incheon Municipal Government.

It will start with five Airbus A320s and be based at Seoul Incheon International Airport.

Not to be out done, Korean Air announced last November it plans to launch a low-cost carrier in May called Air Korea.

And earlier this year there was an announcement that Asiana Airlines will have a 46% stake in and will manage Busan International Air, a new airline that plans to launch later this year and is to be based in South Korea's port city of Busan.

And there are also two other start-ups - Yeongnam Air and Kostar Airlines - which both plan to launch this year and use Fokker 100s.

All of these new airlines will be restricted to operating in South Korea's domestic market because the government last November announced that all new airlines will have to wait two years before being permitted to operate internationally.

This means they will be up against South Korea's high-speed trains.

South Korea's new rules are also a major blow to Tiger which had hoped to launch services from South Korea to China and Japan.