South Korean Airlines Expand International Routes to Drive Profit Recovery in Second Half

Rahaman Hadisur
Jul 22
2 min read

Hadisur Rahman, JadeTimes Staff

H. Rahman is a Jadetimes news reporter covering Asia

South Korean airlines are accelerating their international expansion, particularly to China, Japan, and Southeast Asia, as they seek to restore profitability in the second half of the year. The push comes amid a stronger Korean won and easing fuel prices, factors expected to improve margins after a challenging first half.

According to industry data, Korean Air Lines Co., the nation’s largest full-service carrier, has increased its weekly flights to China to 194 this month from 188, reaching about 90% of pre‑pandemic levels. The airline is reviewing plans to add even more services on its China routes in the months ahead. Asiana Airlines Inc., now a Korean Air subsidiary, has also boosted its weekly flights to China by 26 since May.

Low-cost carriers are following the same trajectory. Jeju Air Co. has raised its China services to seven flights a week, while others are venturing into long-haul markets. T’way Air Co. will launch flights to Vancouver next week, becoming the first Korean budget airline to serve Canada, and Air Premia Inc. is adding a route to Honolulu, Hawaii, this month.

The renewed push reflects a strong rebound in outbound travel. According to the Ministry of Land, Infrastructure and Transportation, international passengers from Korea grew 7.1% year-on-year in the first half to 45.83 million, surpassing the previous record of 45.56 million set in 2019.

Travel to China surged 24.3% to 7.81 million, aided by Beijing’s new visa-free policy for short stays.
Travel to Japan rose 9.9% to 13.43 million.

Airlines expect the favorable cost environment to support earnings. A stronger won reduces dollar-denominated expenses such as fuel and aircraft leasing, while easing oil prices lower operating costs. Fuel typically accounts for around 30% of total operating expenses.

Despite record earnings last year, Korean carriers reported weaker results in the first half of this year. All four listed budget airlines—Jeju Air, Jin Air Co., T’way Air, and Air Busan Co. are expected to post operating losses for the second quarter.

Jeju Air’s operating loss is forecast to widen to 40 billion won ($29.1 million), compared with a 5.3 billion won loss a year earlier.
T’way Air is projected to record a 41.5 billion won loss, versus 21.5 billion won last year.

The downturn in air freight, worsened by hefty U.S. tariffs introduced in April, has also weighed on revenue, removing a critical buffer that helped carriers during the pandemic when passenger traffic was weak.

Industry analysts note that international routes are typically more profitable than domestic services, offering higher yields per seat.

“Expanding international routes, typically more profitable than domestic ones, should lift earnings,” an aviation industry official said. “But intense competition could drive fares down and eat into margins.”

As airlines move to capture surging travel demand, the industry is betting that its sharpened focus on international markets particularly lucrative short-haul destinations will help reverse recent losses and propel a stronger performance in the second half of the year.