Asiana Airlines, which hit a major slump between 2012 and 2015, chalked up 257 billion won in operating profit last year. It is the first time since 2011 that the national flag carrier surpassed 200 billion won in operating profit. The airliner saw the rate of operating profit stand at 4.4 percent, five-year high.
Asiana Airlines President Kim Soo-cheon said, “Asiana Airlines had improved business performances thanks to favorable crude oil prices, foreign exchange rates, market demand, and higher profitability through restructuring. The airliner marked a turning point following a long tunnel,” he added.
President Kim is upbeat, saying Asiana Airlines is predicted to post 300 billion won in operating profit and see the operating profit rate rise to 5.2 percent this year.
The restructuring of the airliner, which began last year, will last until 2018, President Kim said.
The airline industry is faced with an unprecedented crisis due to upheaval caused by the growth momentum of low-cost carriers (LCCs), said Kim, adding that the airliner will set 2017 as a year in which it will mark a milestone in its restructuring drive.
Kim stressed the normalization of management through restructuring at a meeting with reporters at Asiana Airlines headquarters in Oshoe-dong, Seoul, on Feb. 16. He said that the outlook of the LCC industry was not rosy when it was introduced, but the industry has survived significant upheaval throughout the past decade. Starting with the launch of Jeju Air, Korea’s first LCC, in 2004, the industry has been in an expansionary mode with six LCCs in operation. LCCs now lead the airline market, and conventional major airliners are struggling, with Asiana Airlines being in a similar situation, he said.
If airliners are complacent with the conventional mold, he said they will fail. They have to continue to adapt to survive.
Asiana Airlines cut its manpower and costs last year, Kim said. He went on to say that his airliner plans to focus on ramping up competitiveness this year by introducing four A350s. The airliner is to introduce a combined 30 A350s between 2017 and 2025. With the introduction of highly efficient hardware, he said customer satisfaction will go up. Asiana Airlines, established in 1988, marks its 29th anniversary on Feb. 17. “This is the most significant year, and if Asiana Airliners overcomes the process (restructuring), it will grow further next year marking the 30th anniversary.”
President Kim said management conditions for this year are not easy, particularly due to rising crude oil prices and severe foreign exchange fluctuations, so the airliner has no options but to secure a competitive edge not to be swayed by business environment changes.