Jeju Air Recovers Mid-Short Haul Competitiveness... "Average Load Factor 94%"

Jeju Air announced on the 15th that it is steadily recovering its core competitiveness centered on medium- and short-haul routes.

In the first quarter of this year, Jeju Air operated 10,025 international flights and 6,968 domestic flights, recovering 77% and 110%, respectively, compared to 13,003 international flights and 6,348 domestic flights during the same period in 2019. The average load factor also recorded 94%, surpassing the 91% recorded in the first quarter of 2019.

In particular, Jeju Air’s core route to Japan transported 840,000 passengers out of a total of 3.86 million passengers carried by all Korean carriers in the first quarter of this year, securing the number one position with a 22% market share.

It also secured a competitive edge on Southeast Asian routes. On the Thailand route, it transported 219,000 passengers out of a total of 919,000 passengers carried by all Korean carriers, recording a 24% market share. On the Philippines route, it transported 200,000 passengers out of a total of 700,000 passengers carried by all Korean carriers, achieving 30% market share and ranking second among Korean carriers in both regions.

Jeju Air recorded sales of 422.3 billion KRW and an operating profit of 70.7 billion KRW in the first quarter of this year, marking two consecutive quarters of profit following the fourth quarter of last year, continuing its financial restructuring.

Although there were concerns about the airline industry's performance due to delayed recovery of the China routes earlier this year, Jeju Air was able to achieve two consecutive quarters of profit by flexibly expanding supply on its core domestic, Japan, and Southeast Asian routes.

The flexible operation of supply on Jeju-based domestic routes and Japan and Southeast Asian routes according to the situation in the Chinese market and changes in demand was effective. Jeju Air’s sales from China routes accounted for about 15% of total sales in the first quarter of 2019, but this year, considering the uncertainty of the Chinese market, it lowered its sales targets. This strategy aims to minimize the impact of delayed recovery of China routes.

Based on its excellent performance in the first quarter of this year, Jeju Air plans to focus its capabilities on restoring economies of scale in the second half of the year through fleet expansion and modernization. It plans to discover new routes and enhance cost competitiveness by modernizing its fleet, switching from the currently operated B737-800NG to directly purchasing the B737-8, which improves fuel efficiency and extends flight range.

As the first Korean LCC to directly purchase the B737-8 aircraft, which not only improves fuel efficiency but also offers better cost competitiveness than leasing, it is expected to play a key role in establishing a sustainable profit structure and serve as a major differentiating factor from competitors. A Jeju Air official said, “We will expand consumer choices and enhance company competitiveness through flexible supply expansion and diverse flight schedules to respond flexibly to the market,” adding, “We will continue new challenges to improve passenger convenience, such as discovering new destinations, and further strengthen our market position as a leading airline.”

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