Why Did the Minister Target 'Mileage'?

Targeting Airlines After Telecom and Finance
Yoon: "Government-Licensed Monopoly Industries with Public Goods Nature"
Direct Hit on Won Hee-ryong via SNS After Remarks
Korean Air Mileage Reform Likely to Be Delayed

[Asia Economy Reporter Choi Dae-yeol] Korean Air is considering a temporary expansion of the number of seats available for mileage redemption. This move comes as consumer dissatisfaction with the mileage reform plan, which was scheduled to be implemented from April, has grown significantly, and even Won Hee-ryong, Minister of Land, Infrastructure and Transport, has criticized it. It is reported that a supplementary plan will be finalized as early as next week.

According to a summary of aviation industry coverage on the 17th, Korean Air has recently been discussing with the Ministry of Land, Infrastructure and Transport the possibility of postponing the application of the mileage reform plan to the second half of the year and increasing the number of seats available for mileage redemption. It is known that Korean Air is considering operating special charter flights on certain high-demand routes such as New York and Paris for mileage seats. Although the mileage reform plan does not require approval from authorities, the growing interest surrounding the plan has led the operator and the aviation regulatory department to work together to review it.

This measure is in response to continuous dissatisfaction among domestic and international consumers regarding the mileage reform plan originally scheduled to take effect in April. The core of the new system is changing the mileage deduction criteria, which were previously divided by region, to be based on flight distance. Currently, deductions are made based on one domestic and four international regions. Going forward, it will be subdivided into one domestic and ten international regions.

This change will be disadvantageous for long-distance travelers. For example, the Incheon?New York route currently requires 35,000 miles (economy class) until March, but this will increase to 45,000 miles, an increase of 10,000 miles. Prestige class will increase from 62,500 miles to 90,000 miles, and first class from 80,000 miles to 135,000 miles. Korean Air revised its terms of use at the end of 2019 and planned to apply the changes from April the following year, but postponed implementation for three years due to the COVID-19 outbreak.

Won Hee-ryong, Minister of Land, Infrastructure and Transport / Paju = Photo by Hyunmin Kim kimhyun81@

Won Hee-ryong, Minister of Land, Infrastructure and Transport, strongly criticized the reform plan on his social media account the day before. Industry insiders speculated that he might have indirectly expressed dissatisfaction with the ongoing discussions about the re-reform plan. He pointed out, "(Korean Air) achieved record-breaking profits but customers were neglected," and described airline mileage as a so-called "glittering but worthless fruit," meaning it is difficult to accumulate and has limited places to use.

He also threatened to directly intervene. Minister Won said, "As the minister in charge of aviation, I find it difficult to agree with this reform plan," adding, "A rational review of mileage usage standards and genuine improvements are necessary, and I will fulfill the role needed from the public’s perspective."

The government’s pressure on certain industries or companies under the pretext of alleviating public hardships has garnered favorable public opinion. Following the telecommunications and financial sectors, the aviation industry is also a sector requiring government approval. On the 15th, President Yoon Suk-yeol encouraged shared pain by citing that some oligopolistic industries with strong public utility characteristics are making significant profits. Considering recent consumer dissatisfaction, Korean Air and the Ministry of Land, Infrastructure and Transport plan to present a revised reform plan reflecting adjustments as early as next week.

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