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LAXintl
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Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Fri Nov 22, 2019 7:05 pm

Korean Air new chairman Cho Won-tae stated the carrier may sell non-core assets to focus on the air transportation, aircraft parts manufacturing, hotel and resort businesses.

"It is hard for us to keep our mainstay businesses in good condition due to unfavorable business conditions. We expect the economy to deteriorate further next year due to the ongoing U.S.-China trade war and lower travel demand to Japan amid a bilateral trade dispute," Cho said. He also picked the weakening won against the dollar as another headache for the country's biggest full-service carrier in 2020.

In the January-September period, Korean Air's net losses deepened to 709.48 billion won (USD $607 million) from 57.49 billion won a year earlier.

Korean Air is considering forming a joint venture with a foreign company that is similar to the one with the U.S. carrier for business synergy, the chairman said.


Korean Air to focus on mainstay business: chairman
https://en.yna.co.kr/view/AEN20191120003100320

=

Based on the chairman's comments, units potentially available for sale include catering, retail division, military support, and various aerospace-related enterprises, and property holdings

On the JV suppose it could be something similar to the Delta one with AFKL with focus on Europe.
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mercure1
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Fri Nov 22, 2019 7:24 pm

What happened in Korea with both KE and OZ being in trouble all of a sudden?
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TWA85
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Fri Nov 22, 2019 7:24 pm

What about JVs with multiple carriers around the world? AF/KL in Europe, MU in China, EY in West Asia, and CI, GA, and VN in Southeast Asia.
 
MIflyer12
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Fri Nov 22, 2019 7:26 pm

LAXintl wrote:
Korean Air new chairman Cho Won-tae stated the carrier may sell non-core assets to focus on the air transportation, aircraft parts manufacturing, hotel and resort businesses.


He wants to call that focused, does he? Imagine if Boeing or Airbus built aircraft, ran a carrier, and managed Hilton Hotels simultaneously.
 
zakuivcustom
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Fri Nov 22, 2019 7:26 pm

The double trade wars (One directly with Japan, the other indirectly getting affected by the US-China one) is just not helping the South Korean economy. In terms of aviation, heavy competitions certainly doesn't help, either.

Will be interesting to see where KE and OZ goes from here. The whole South Korean aviation industry is in a quagmire right now.

EDIT:
mercure1 wrote:
What happened in Korea with both KE and OZ being in trouble all of a sudden?


See above...South Korean economy is not exactly doing well.

MIflyer12 wrote:
He wants to call that focused, does he? Imagine if Boeing or Airbus built aircraft, ran a carrier, and managed Hilton Hotels simultaneously.


It's VERY typical in South Korea, though. Chaebol (Large conglomerate) still dominate the South Korean business scene and often formed monopoly/duopoly in many sectors.
Last edited by zakuivcustom on Fri Nov 22, 2019 7:40 pm, edited 1 time in total.
 
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UPlog
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Fri Nov 22, 2019 7:34 pm

KE also needs to update things such as its premium cabins, IFE and technology to become more competitive.

For such a hyper technology-focused country, KE seems to be stuck a decade or two behind.
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x1234
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Fri Nov 22, 2019 7:43 pm

KE STILL doesn't have the gold standard of business class (1-2-1, more space per customer) while the AFKL + DL planes have the new suites. Also in-flight wifi and price is accordingly.
 
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Fri Nov 22, 2019 9:05 pm

MIflyer12 wrote:
LAXintl wrote:
Korean Air new chairman Cho Won-tae stated the carrier may sell non-core assets to focus on the air transportation, aircraft parts manufacturing, hotel and resort businesses.


He wants to call that focused, does he? Imagine if Boeing or Airbus built aircraft, ran a carrier, and managed Hilton Hotels simultaneously.

Boeing use to own United if I remember correctly and didn’t Hugh’s aircraft own TWA?
 
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Fri Nov 22, 2019 9:38 pm

Phoenix757767 wrote:
MIflyer12 wrote:
LAXintl wrote:
Korean Air new chairman Cho Won-tae stated the carrier may sell non-core assets to focus on the air transportation, aircraft parts manufacturing, hotel and resort businesses.


He wants to call that focused, does he? Imagine if Boeing or Airbus built aircraft, ran a carrier, and managed Hilton Hotels simultaneously.

Boeing use to own United if I remember correctly and didn’t Hugh’s aircraft own TWA?


TWA was own by Howard Hughes (who also owned the namesake Hughes Aircraft), but they were separate entity.

While reading up TWA's history (on, well, Wikipedia...so it may not be 100% accurate), though, TWA also used to own Hilton (International?) Hotels and Century 21 Realty, among other investments. For that, they were definitely similar to KE conglomerate right now.
 
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Fri Nov 22, 2019 10:23 pm

zakuivcustom wrote:
Phoenix757767 wrote:
MIflyer12 wrote:

He wants to call that focused, does he? Imagine if Boeing or Airbus built aircraft, ran a carrier, and managed Hilton Hotels simultaneously.

Boeing use to own United if I remember correctly and didn’t Hugh’s aircraft own TWA?


TWA was own by Howard Hughes (who also owned the namesake Hughes Aircraft), but they were separate entity.

While reading up TWA's history (on, well, Wikipedia...so it may not be 100% accurate), though, TWA also used to own Hilton (International?) Hotels and Century 21 Realty, among other investments. For that, they were definitely similar to KE conglomerate right now.


UAL in the 1980s , when it was known as the Allegis Corp, is the most famous attempt at a travel conglomerate in the US. They owned UA, Hertz, and the Westin and Hilton hotel chains. It is also a cautionary tale because Allegis failed miserably.
 
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Fri Nov 22, 2019 10:51 pm

usflyer msp wrote:

UAL in the 1980s , when it was known as the Allegis Corp, is the most famous attempt at a travel conglomerate in the US. They owned UA, Hertz, and the Westin and Hilton hotel chains. It is also a cautionary tale because Allegis failed miserably.


Just a quick note: they owned Hilton International, not Hilton. (The two Hiltons have since merged.) But Allegis was a disaster, as you said.
 
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Fri Nov 22, 2019 11:58 pm

x1234 wrote:
KE STILL doesn't have the gold standard of business class (1-2-1, more space per customer) while the AFKL + DL planes have the new suites. Also in-flight wifi and price is accordingly.

To be fair to KE, DL is the only fully flat, all aisle access airline in that list. AF and KL are still upgrading their fleets. Also, I thought the 380 on KE was full flat with all aisle access?
 
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sat Nov 23, 2019 1:48 am

Aside from Korean Air and Jin Air, other enterprises in the Hanjin Group include Inha and Korea Aerospace Universities, an in-house catering unit, and the Wilshire Grand Center in Los Angeles. I have to imagine that the Wilshire Grand and Inha University would be likely entities to be sold. Hanjin Group's marine shipping division collapsed spectacularly in 2016 and was liquidated in 2017.
 
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sat Nov 23, 2019 2:27 am

WS has mentioned numerous times that they are seeking a JV with Korean. This could be the impetus of talks between the two.
 
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UPlog
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sat Nov 23, 2019 2:43 am

aemoreira1981 wrote:
Aside from Korean Air and Jin Air, other enterprises in the Hanjin Group include Inha and Korea Aerospace Universities, an in-house catering unit, and the Wilshire Grand Center in Los Angeles. I have to imagine that the Wilshire Grand and Inha University would be likely entities to be sold. Hanjin Group's marine shipping division collapsed spectacularly in 2016 and was liquidated in 2017.


KAL owns more hotels than just the marque hotel in L.A.

They also have properties domestically in Korea including resort in Jeju, and property in Seoul plus managing franchises such as Hyatt properties.
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sat Nov 23, 2019 3:55 am

delimit wrote:
x1234 wrote:
KE STILL doesn't have the gold standard of business class (1-2-1, more space per customer) while the AFKL + DL planes have the new suites. Also in-flight wifi and price is accordingly.

To be fair to KE, DL is the only fully flat, all aisle access airline in that list. AF and KL are still upgrading their fleets. Also, I thought the 380 on KE was full flat with all aisle access?


x1234 is incorrect. I just flew KE BOS-ICN-SIN in J on their 798 and 77W and both planes were 1-2-1 with the fabulous apex suite. MUCH better than anything AF, KL or DL offers. Now their soft product was horrible. They need to drastically improve bedding, catering and entertainment immediately.
 
DeltaPSCFlyer
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sat Nov 23, 2019 3:59 am

Good news/bad news for DL....wonder what this might mean, given the recent 20% stake purchase in LATAM...might we see DL increase their investment in KE?
 
ITSTours
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sat Nov 23, 2019 4:56 am

UPlog wrote:
aemoreira1981 wrote:
Aside from Korean Air and Jin Air, other enterprises in the Hanjin Group include Inha and Korea Aerospace Universities, an in-house catering unit, and the Wilshire Grand Center in Los Angeles. I have to imagine that the Wilshire Grand and Inha University would be likely entities to be sold. Hanjin Group's marine shipping division collapsed spectacularly in 2016 and was liquidated in 2017.


KAL owns more hotels than just the marque hotel in L.A.

They also have properties domestically in Korea including resort in Jeju, and property in Seoul plus managing franchises such as Hyatt properties.


And Heather Cho the Nut Rage wants to lead the hotel business!
KE may spinoff hotel business but they will not sell them.
 
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sat Nov 23, 2019 4:59 am

delimit wrote:
x1234 wrote:
KE STILL doesn't have the gold standard of business class (1-2-1, more space per customer) while the AFKL + DL planes have the new suites. Also in-flight wifi and price is accordingly.

To be fair to KE, DL is the only fully flat, all aisle access airline in that list. AF and KL are still upgrading their fleets. Also, I thought the 380 on KE was full flat with all aisle access?


New 77Ws, all 748s, some newer A333s: Apex suites
A380: 2-2-2 fully flat, no all aisle access
 
clrd4t8koff
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sat Nov 23, 2019 5:02 am

ITSTours wrote:
delimit wrote:
x1234 wrote:
KE STILL doesn't have the gold standard of business class (1-2-1, more space per customer) while the AFKL + DL planes have the new suites. Also in-flight wifi and price is accordingly.

To be fair to KE, DL is the only fully flat, all aisle access airline in that list. AF and KL are still upgrading their fleets. Also, I thought the 380 on KE was full flat with all aisle access?


New 77Ws, all 748s, some newer A333s: Apex suites
A380: 2-2-2 fully flat, no all aisle access


All KE 789’s also are 1-2-1 in J
 
ITSTours
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sat Nov 23, 2019 5:13 am

clrd4t8koff wrote:
ITSTours wrote:
delimit wrote:
To be fair to KE, DL is the only fully flat, all aisle access airline in that list. AF and KL are still upgrading their fleets. Also, I thought the 380 on KE was full flat with all aisle access?


New 77Ws, all 748s, some newer A333s: Apex suites
A380: 2-2-2 fully flat, no all aisle access


All KE 789’s also are 1-2-1 in J


Welp I missed it. It is Apex Suites so technically 2-2-2 but it's all aisle access.
 
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sat Nov 23, 2019 10:06 am

KE needs to change their seating configuration mentality.

They plan to reduce F. Great. They should completely get rid of it if they can. And on some aircraft, F was never adequately differentiated from J. Being the same seat...

KE needs to move away from the Apex J seat. Arguably one of the best J products available, if not the absolute best. However, Apex J is very space consuming. It takes more space than an equivalent number of reverse herringbone or staggered seats. Even JL shifted away from the Apex J on later deliveries.

As for Y, KE should go to the industry standard 31-32 inch pitch instead of 33-34 inches. In some cases, this simple change could allow them to add another row or two to their aircraft, positively improving CASK.

And streamline your damn fleet KE, for heaven's sake!

KE has been too out of touch with market reality for too long...
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ITSTours
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sat Nov 23, 2019 2:52 pm

MoKa777 wrote:
KE needs to change their seating configuration mentality.

They plan to reduce F. Great. They should completely get rid of it if they can. And on some aircraft, F was never adequately differentiated from J. Being the same seat...

KE needs to move away from the Apex J seat. Arguably one of the best J products available, if not the absolute best. However, Apex J is very space consuming. It takes more space than an equivalent number of reverse herringbone or staggered seats. Even JL shifted away from the Apex J on later deliveries.

As for Y, KE should go to the industry standard 31-32 inch pitch instead of 33-34 inches. In some cases, this simple change could allow them to add another row or two to their aircraft, positively improving CASK.

And streamline your damn fleet KE, for heaven's sake!

KE has been too out of touch with market reality for too long...


The CEO literally says that he is a tall guy so they maintain the wider legroom. Welp I am not a tall guy but thanks I guess?
 
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thekorean
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sat Nov 23, 2019 2:57 pm

Wonder when KE will sit down with AF/KLM to start talking JV. Haven’t heard a peep there.
 
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sat Nov 23, 2019 3:23 pm

thekorean wrote:
Wonder when KE will sit down with AF/KLM to start talking JV. Haven’t heard a peep there.


Cho Won Tae recently had an interview where he said there is a "constraint" for doing JV with Europe.
https://n.news.naver.com/article/001/0011224270 (Article in Korean, but you are thekorean so...)

I assume that to be the lack of open skies with France and the Netherlands.
 
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sat Nov 23, 2019 5:07 pm

There is clearly enormous untapped potential for KE to form closer commercial relationships focusing on JVs with AF/KL, VS, WS, AM and now LATAM. KE needs to sell off the noncore assets and focus on being a great airline in all respects, including demonstrating the ability to be consistently profitable.
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sat Nov 23, 2019 6:04 pm

This shouldn't be a surprise. In Europe, ULCCs kill short haul yield but legacies can continue to make money on the long haul stuff. In Asia, ULCCs kill the short haul yield and CN3 kill the long haul yield. KE is not the only full service carrier in trouble in Asia. ICN is not going to be as large of a business market as Tokyo or HK or Singapore or even Shanghai. And it's costs are higher than CN3. Hard to see this turning around. Lol, why would KE want to form JV with WS, Latam and AM? Not everything is about DL.
 
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sat Nov 23, 2019 6:57 pm

I haven't flown KE in four or five years but I was very underwhelmed with their business class lounges, including Incheon. I found it to be rather crowded, and their liquor assortment was limited to whatever distillery advertises in their in-flight magazine. No gin or bourbon, really? Has this since been rectified? Compared with lounges by CX, NH, or JL I was rather disappointed. I did however enjoy their on board service in J.
 
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sat Nov 23, 2019 7:01 pm

MoKa777 wrote:
KE needs to change their seating configuration mentality.

They plan to reduce F. Great. They should completely get rid of it if they can. And on some aircraft, F was never adequately differentiated from J. Being the same seat...

KE needs to move away from the Apex J seat. Arguably one of the best J products available, if not the absolute best. However, Apex J is very space consuming. It takes more space than an equivalent number of reverse herringbone or staggered seats. Even JL shifted away from the Apex J on later deliveries.

As for Y, KE should go to the industry standard 31-32 inch pitch instead of 33-34 inches. In some cases, this simple change could allow them to add another row or two to their aircraft, positively improving CASK.

And streamline your damn fleet KE, for heaven's sake!

KE has been too out of touch with market reality for too long...


In that area on a legacy carrier, 32-34" pitch is actually standard. JL and NH are both 34" in Y (although NH seats are only 17" wide) long-haul, and OZ is also 33" in Y long-haul. Air China, China Airlines, China Eastern, and Cathay are all at least 32" in Y. That said, only the A388s, B77Ws, and B748s should have F, and a W cabin should also be introduced, and I'd argue to go 3-4-3 in Y on all (CI, NH, and MU have, CA has a subfleet of such, CX is going that way, and the rest should...I could live easily with 32-34"/17". (F)/J/W/Y+/Y is the way to go.
 
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LAXintl
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Sun Nov 24, 2019 11:03 pm

Received a copy of KE "Vision 2023" development plan

Some highlights:

Goal: Global Leading Airline

Passenger Business Strategy

Network Enhancement
o Optimize fleet operation and frequency on route demand
o Expand South East Asia routes
o Leverage joint-venture/partnerships to capture greater Europe/US-Asia premium demand

Operation Efficiency Improvement
o Modernize fleet with high efficiency models
o Launch O&D Revenue Management System for improved yield management
o Increase IT service infrastructure & personnel training

Service Quality Improvement
o Provide personalized oriented premium services
o Integrate social media for customer interaction
o Utilize accumulated big data for customized marketing


Cargo Business Strategy

Customer Service
o Increase customer satisfaction with fast & safe transport
o Improve customer convenience with iCargo system
o Strengthen support for global customers (Samsung, Apple, Amazon)
o Increase focus on e-commerce merchandise, medical goods, fresh products, telecom equipment

Network
o Utilize high fuel efficient new fleet (B777F, B747-8F)
o Maximize integration of passenger fleet belly space
o Expand network through foreign airline collaborations (KE/DL JV, UPS, FEDEX)
o Increase capacity in high growth markets like Vietnam, India, Latin America

Aerospace Strategy

o Increase new manufacturing business
o Expand Process Automation - cost competitiveness improvement
o Develop Specialized Technology - Stealth, Hybrid-Engine, etc
o Increase Aircraft Modification Projects
o Collaborate with other global vendors

Catering / Duty Free Sales Strategy

o Secure Market Leadership & Capability in Flight Catering
o Enhance global competitiveness with catering quality & safety upgrade
o Increase passenger & airline customer satisfaction with new menu or product development
o Analyze big data & market trend to develop customer preferred products
o Focus on sales of high margin product for profit increase
o Enhance targeted marketing programs and incentives to drive customer demand increases


Top passenger markets by revenue
1. Americas
2. Southeast Asia
3. China
4. Europe
5. Japan
6. Domestic
7. Oceania

Top cargo markets by revenue
1. Americas
2. Europe
3. South East Asia
4. China
5. Japan
6. Oceania
7. Domestic
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Mon Nov 25, 2019 2:41 am

Let see if this Vision 2023 delivers.

I always find it interesting companies come up with these type of manifestos to only see then fail as the competitive landscape changes so fast making many targets meaningless or half measures.

Thanks for posting.
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Antarius
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Mon Nov 25, 2019 3:28 am

delimit wrote:
x1234 wrote:
KE STILL doesn't have the gold standard of business class (1-2-1, more space per customer) while the AFKL + DL planes have the new suites. Also in-flight wifi and price is accordingly.

To be fair to KE, DL is the only fully flat, all aisle access airline in that list. AF and KL are still upgrading their fleets. Also, I thought the 380 on KE was full flat with all aisle access?


It also depends on the market. AF is based in paris, which is a major diversified city with tons of demand. Similar to how BA has made record profits with a 8 across J. Seoul is a major city as well, but air traffic yields are more business dependent. While South Korea has a lot of Tourists, the vast majority are from nearby places like Japan, China etc. which dont generate the same yield premium as longhaul premium classes.

As a result, between the economy slowdown, serious competition from LCC carriers (which have a catchment overlap with most of South Korea's non business demand and lots of their business demand as well) and a non-differentiating product at the upper level, KE has some serious issues.
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Mon Nov 25, 2019 3:45 am

I believe a JV with VN will also help KE in trying to compete against LCC(s) to and from Vietnam. KE currently flies to 5 different cities in Vietnam (including second tier cities like Da Lat and Nha Trang) and given the huge amount of business and leisure traffic volumes between the two countries, this can work.
 
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Mon Nov 25, 2019 8:57 pm

aemoreira1981 wrote:
Aside from Korean Air and Jin Air, other enterprises in the Hanjin Group include Inha and Korea Aerospace Universities, an in-house catering unit, and the Wilshire Grand Center in Los Angeles. I have to imagine that the Wilshire Grand and Inha University would be likely entities to be sold. Hanjin Group's marine shipping division collapsed spectacularly in 2016 and was liquidated in 2017.


They also spend quite a bit on "cultural" sponsorships. I recall seeing the KE logo all over the British Museum recently; they've partnered with the Louvre as well. I wonder if these are areas that can be cut back on.
No not that TSA.
 
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Mon Nov 25, 2019 9:04 pm

zakuivcustom wrote:
Phoenix757767 wrote:
MIflyer12 wrote:

He wants to call that focused, does he? Imagine if Boeing or Airbus built aircraft, ran a carrier, and managed Hilton Hotels simultaneously.

Boeing use to own United if I remember correctly and didn’t Hugh’s aircraft own TWA?


TWA was own by Howard Hughes (who also owned the namesake Hughes Aircraft), but they were separate entity.

While reading up TWA's history (on, well, Wikipedia...so it may not be 100% accurate), though, TWA also used to own Hilton (International?) Hotels and Century 21 Realty, among other investments. For that, they were definitely similar to KE co

You are correct. In the mid 1970's TWA owned kCanteen Corp, Hilton International, and Century 21, and by the 1990's, they even owned the Travel Channel cable TV network. Hughes owned Hughes Tool, and purchased aircraft through that entity which was then leased to TWA (that's how they got their Convair 880 fleet in 1959).

Pan Am also owned their own hotels (Intercontinental), and United owned Western International (now Westin). And Continental had their own hotels in Micronesia in connection with their interest in Air Micronesia. American also owned a hotel operation, as did Braniff. It was not at all uncommon in the U.S. back in the day.
 
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Mon Nov 25, 2019 9:39 pm

MIflyer12 wrote:
LAXintl wrote:
Korean Air new chairman Cho Won-tae stated the carrier may sell non-core assets to focus on the air transportation, aircraft parts manufacturing, hotel and resort businesses.


He wants to call that focused, does he? Imagine if Boeing or Airbus built aircraft, ran a carrier, and managed Hilton Hotels simultaneously.


Exactly. Although selling aircraft parts and running hotels are likely two areas that deliver more dependable profits than the airline industry, they really don't leverage KE's core competency of running an airline. They could use the proceeds from selling their peripheral business to pay down debt or fund their operating losses. Finding yourself in a potentially tight cash situation is tough when you have a lot of valuable assets that could be sold.
 
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Thu Nov 28, 2019 2:06 am

zakuivcustom wrote:
Phoenix757767 wrote:
MIflyer12 wrote:

He wants to call that focused, does he? Imagine if Boeing or Airbus built aircraft, ran a carrier, and managed Hilton Hotels simultaneously.

Boeing use to own United if I remember correctly and didn’t Hugh’s aircraft own TWA?


TWA was own by Howard Hughes (who also owned the namesake Hughes Aircraft), but they were separate entity.

While reading up TWA's history (on, well, Wikipedia...so it may not be 100% accurate), though, TWA also used to own Hilton (International?) Hotels and Century 21 Realty, among other investments. For that, they were definitely similar to KE conglomerate right now.


they also owned Canteen corp who specialized in Vending machined for snack foods, As a matter of fact? It was canteen Corp that heaped TWA with all of their Debt and spun them off to flounder, Then? They themselves floundered. /the Senior management at UNITED under then CEO Richard Ferris sought to do the same Thing to United when they came up with the "Allegis scheme" It lasted about 72 hours before the Pilots sought a takeover of UAL Inc and Ferris, Jim Hartigan and a bunch of other folks got shown the door!
 
strfyr51
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Thu Nov 28, 2019 2:16 am

'this is nothing NEW,, United once owned the Westin Hotel chain, Hertz 'car rental, Mauna Loa Macadamia Nuts, Air Wisconsin and a bunch of other enterprises under the UAL Inc banner which was rumored to include refineries they still own an Oil/ Jet fuel trading business under the UAL Inc banner.
 
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lightsaber
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Thu Nov 28, 2019 8:53 pm

usdcaguy wrote:
MIflyer12 wrote:
LAXintl wrote:
Korean Air new chairman Cho Won-tae stated the carrier may sell non-core assets to focus on the air transportation, aircraft parts manufacturing, hotel and resort businesses.


He wants to call that focused, does he? Imagine if Boeing or Airbus built aircraft, ran a carrier, and managed Hilton Hotels simultaneously.


Exactly. Although selling aircraft parts and running hotels are likely two areas that deliver more dependable profits than the airline industry, they really don't leverage KE's core competency of running an airline. They could use the proceeds from selling their peripheral business to pay down debt or fund their operating losses. Finding yourself in a potentially tight cash situation is tough when you have a lot of valuable assets that could be sold.

PanAm sold the stable income to save the airline. This isn't a good sign.

Lightsaber
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mercure1
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Fri Dec 06, 2019 6:09 pm

KE VP of Network talks about growth, though it will be limited by lack of available slots at ICN. Basically no new movements available between 8am-10pm so the development of the hub further will be limited until 2023 when 4th runway comes online.

Expansion targets are Southeast Asia and Southern Europe and Mediterranean area. Also more China growth provided air service agreement allows.


https://www.routesonline.com/news/29/br ... rs-growth/
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ITSTours
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Mon Dec 23, 2019 8:30 am

Meanwhile, Heather Cho the Nut Rage accused the current CEO and her brother Walter Cho for not following the deceased father's will: cooperation between the siblings.

https://www.reuters.com/article/us-kore ... SKBN1YR0JO

The stock of Hanjin KAL, Korean Air's parent company, soared 20% today.
 
Noshow
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Mon Dec 23, 2019 10:26 am

I have flown both Korean (A380 and 747-8) and Asiana (A380) in both Economy and Business and I was very impressed with their cabin, service and catering. They are far above european legacies for sure.
 
zakuivcustom
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Mon Dec 23, 2019 2:29 pm

ITSTours wrote:
Meanwhile, Heather Cho the Nut Rage accused the current CEO and her brother Walter Cho for not following the deceased father's will: cooperation between the siblings.

https://www.reuters.com/article/us-kore ... SKBN1YR0JO

The stock of Hanjin KAL, Korean Air's parent company, soared 20% today.


I wonder whether this will turn into some sort of K-drama like stories sooner or later :).

Noshow wrote:
I have flown both Korean (A380 and 747-8) and Asiana (A380) in both Economy and Business and I was very impressed with their cabin, service and catering. They are far above european legacies for sure.


KE's problem has nothing to do with their service anyway. The competition is fierce especially for regional routes thanks to the (what I consider) excessive amount of LCCs in South Korea, then there's the Japan situation where demands plummeted (although it can partially be offset by the improved relation between SK and PRC). AFAIK nobody is really making money in the aviation sector in South Korea anyway.
 
SeoulIncheon
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Mon Dec 23, 2019 3:27 pm

lightsaber wrote:
usdcaguy wrote:
MIflyer12 wrote:

He wants to call that focused, does he? Imagine if Boeing or Airbus built aircraft, ran a carrier, and managed Hilton Hotels simultaneously.


Exactly. Although selling aircraft parts and running hotels are likely two areas that deliver more dependable profits than the airline industry, they really don't leverage KE's core competency of running an airline. They could use the proceeds from selling their peripheral business to pay down debt or fund their operating losses. Finding yourself in a potentially tight cash situation is tough when you have a lot of valuable assets that could be sold.

PanAm sold the stable income to save the airline. This isn't a good sign.

Lightsaber


Actually, hotels have not been a stable source of profit for KAL or the parent, Hanjin KAL... it was close to being a stable source of loss and now faces even more fierce competition from rival conglomerates who have more experience running hotels. Aircraft parts business is a little bit different story though - and it gave KAL some leveraging power over Airbus/Boeing.
 
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mercure1
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Wed Apr 29, 2020 5:38 pm

Korean Air considering sale of subsidiaries of the carrier — in-flight meal service, mileage program and maintenance operations which could fetch an estimated US$2.4 billion.

http://www.koreaninvestors.com/?p=8137
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jfk777
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Wed Apr 29, 2020 9:40 pm

mercure1 wrote:
Korean Air considering sale of subsidiaries of the carrier — in-flight meal service, mileage program and maintenance operations which could fetch an estimated US$2.4 billion.

http://www.koreaninvestors.com/?p=8137


Let the dismemberment of Korean Air begin, these type of things never end well. Why would they still own a catering operation ?
 
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Polot
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Thu Apr 30, 2020 12:44 am

jfk777 wrote:
mercure1 wrote:
Korean Air considering sale of subsidiaries of the carrier — in-flight meal service, mileage program and maintenance operations which could fetch an estimated US$2.4 billion.

http://www.koreaninvestors.com/?p=8137


Let the dismemberment of Korean Air begin, these type of things never end well. Why would they still own a catering operation ?

Because large diverse chaebols (conglomerates) are common and expected in South Korea.
 
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mercure1
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Thu May 14, 2020 4:03 am

Just raised W2.2 trillion (USD $1.8 billion) in fresh capital from a new share issue and in government aid.

Korean Air raises $1.8 billion from new shares and government aid
https://www.flightglobal.com/airlines/k ... 64.article
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Antaras
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Thu May 14, 2020 10:35 am

Found an interesting article from ch-av showed that VN wanted a JV with CI or KE.
However it is covered by a paywall.
https://www.ch-aviation.com/portal/news/83706-vietnam-airlines-eyes-jv-with-china-airlines-korean-air
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Coexstud
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Re: Korean Air Chairman: business conditions poor, looking to divest assets, form more JVs

Thu May 14, 2020 1:29 pm

TWA85 wrote:
What about JVs with multiple carriers around the world? AF/KL in Europe, MU in China, EY in West Asia, and CI, GA, and VN in Southeast Asia.

Asia in trouble look at all carriers.

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