Korea’s Asiana Air
quitting isles

Financial crisis, poor demand cited

By Rob Perez
Star-Bulletin

Citing poor demand, Asiana Airlines is stopping its daily service between Honolulu and Seoul, a move that will cut seating capacity between the two cities by nearly 1,700 weekly.

Local employees at Asiana said the carrier's last Hawaii flight will be Jan. 4. It flies a Boeing 767-300, fit to carry about 240 passengers, on the Seoul-Honolulu route.

The airline said it was stopping its only Hawaii service because few people are using it, largely because of the financial crisis pummeling the Korean economy.

That crisis already has put a significant dent in the number of visitors coming to Hawaii from Korea, according to the Korean Tourism Agents Association of Hawaii.

Last year, roughly 125,000 Korean tourists came to Hawaii, or nearly 350 a day, the association said. So far this month that number has averaged about 20 to 30 a day, said Chong Kuk Kim, president of the association.

Because of the Korean financial crisis, Kim said, the government there is discouraging Koreans from traveling overseas, wanting to boost domestic consumer spending. Combined with the significant devaluation of the Korean won against the dollar, that has significantly affected travel to Hawaii, Kim said.

But he said Korean Air, the No. 1 carrier between Seoul and Honolulu, is sticking with its daily service to Hawaii for now.

Korean Air uses a 747 with a capacity of about 400 passengers on its Hawaii route.

If the Korean crisis worsens, however, Kim worries that Korean Air's service might be reduced.

"My concern is geared more to 1998," he said.

Officials from Korean Air and Asiana Air, the No. 2 carrier in the Seoul-Honolulu market, could not be reached immediately for comment this morning.

A local spokesman for Asiana said the company's 13 Hawaii employees may be out of work when the airline stops its Honolulu service. He said the company hasn't indicated yet what will happen to the workers after Jan. 4.

Before the Korean crisis hit several months ago, local industry officials said the tourism count from Korea was growing. Some officials were estimating a 25 percent increase for 1997.

But since the crisis, the numbers have been dwindling, and Hawaii probably will end up with only about 100,000 visitors from Korea this year, Kim said.

He said Korean Air is partly insulated from the crisis because it has a large customer base in Japan that flies to Honolulu and the U.S. mainland via Seoul.

Asiana Air started flying daily to Honolulu in 1996. It reduced that to five times weekly in October as the Korean financial crisis started affecting demand.

But only last week, the airline resumed the daily flight schedule, the local spokesman said.