Airlines Fear June Despite Increase in Overseas Travelers (Comprehensive)

April Users Up 261% Year-on-Year... PCR Test Burden and Support Fund Uncertainty

On the 22nd, ahead of the weekend, the domestic terminal in Gangseo-gu, Seoul, is bustling with travelers. With the full lifting of social distancing measures and the return to normal life, demand for domestic and international tourism is increasing. Photo by Moon Honam munonam@

[Asia Economy Reporter Yoo Hyun-seok] Despite the increasing number of overseas travelers, the aviation industry is not smiling. This is because the number of overseas travelers is not rapidly increasing due to burdens such as polymerase chain reaction (PCR) tests, and the extension of disaster support maintenance funds and airport usage fee reductions provided to airlines has not been decided. Airlines insist that support is necessary until air travel demand recovers.

According to Incheon International Airport Corporation on the 11th, the number of passengers using Incheon International Airport last month was 649,750, an increase of 58.2% compared to the previous month and 261.3% compared to April last year. It is the first time since March 2020 that the number of passengers at Incheon Airport exceeded 600,000. It is interpreted that overseas travelers increased after the government announced the exemption from self-quarantine for overseas arrivals who completed vaccination starting in March. The number of passengers at Incheon Airport was 357,228 in January, 318,588 in February, and 410,706 in March.

However, the aviation industry complains that the recovery speed is slow. Compared to 5.78 million passengers in April 2019 before COVID-19, the current level is still low. The industry claims that the PCR tests required for overseas travelers are a burden on the recovery of air travel demand.

The problem lies in June. The extension of benefits such as employment retention support funds and airport usage fee reductions provided to airlines has not been confirmed. Korean Air stopped receiving employment retention support funds in March and has been paying paid leave allowances to employees on its own since last month. As a result, labor costs are estimated to increase by hundreds of billions of won from the second quarter. Low-cost carriers (LCCs) such as Asiana Airlines, which recorded a net loss last year, as well as Jeju Air, Jin Air, and T'way Air, which were in deficit, will receive employment retention support funds until June.

In addition, airlines are currently receiving reductions on Incheon Airport facility usage fees. Currently, Incheon International Airport Corporation is reducing landing fees and parking fees by 20% and 100%, respectively, for airlines using Incheon Airport, and ground handling companies are receiving a 100% reduction in apron usage fees. The amount waived by Incheon Airport Corporation for airlines and ground handling companies last year reached 79.1 billion won. The amount for the first quarter of this year was 9 billion won. This reduction is also valid until June. A representative of Incheon International Airport Corporation explained, "We are still in consultation with the Ministry of Land, Infrastructure and Transport regarding the period after June."

Airlines emphasize that support is necessary until full recovery of air travel demand. Except for some airlines, deficits are expected this year as well, so it is explained as a necessary measure for survival. An airline official said, "Although overseas travelers are increasing, it is still only about 10% compared to before COVID-19," adding, "Since the aviation industry is still in a difficult situation, the extension of support is necessary."

This content was produced with the assistance of AI translation services.