April 25, 2024

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[THE INVESTOR] Korean Air and Delta Airlines signed an agreement in Seoul on March 29 to jointly operate trans-Pacific routes.

This takes the partnership between the South Korea’s largest air carrier and the world’s largest by market capitalization and asset value to the fullest, sharing costs and revenue, virtually merging the operations on the routes. 

Both carriers are also founding members of Sky Team Alliance and resumed their code sharing agreement on 79 routes in 2016. 

The two offer flights to over 80 cities in Asia and 250 cities in the America, and the venture would offer greater access in both regions, as well as flexible supply of service without further investments. 

Through the tie-up, the two airlines companies could take up about 14 percent of the trans-Pacific market, closing in on the 15 percent of Japan’s All Nippon Airways and United Airlines. Japan Airlines and American Airlines will be pushed to the third spot, according to a report by CAPA Centre for Aviation in January. 

Incheon International Airport could also benefit from this partnership, as Delta, which operates most of its direct flights to and from Northeast Asia out of Narita Airport, is likely to shift its hub to Incheon. Korean Airlines and the Atlanta-based carrier have already decided to introduce a direct flight between Incheon and Atlanta starting in June. 

By Hwang You-mee (glamazon@heraldcorp.com)