New Low Cost Airline - Air Korea - to launch May 2008

Korean Air disclosed details on its low cost carrier (LCC) operation plans through a corporate filing to Korea’s Financial Supervisory Office on Monday.

The new LCC, tentatively named ‘Air Korea’ will begin operation in May 2008. At a board meeting held on Friday, November 23, 2007, Korean Air approved plans to invest 20 billion Korean won (approximately US$ 21.56 million) to establish a separate corporate body for the LCC within December.

Air Korea will use Incheon International Airport as its base airport. Starting May 2008, it will launch routes to destinations in China’s Shandong and Hainan Provinces, which are under the open skies agreement between Korea and China and thus do not limit airlines’ route operations. Air Korea will also open routes to Japan (except Tokyo), Thailand and Malaysia, which are also under open skies agreements. It gradually plans to widen its network to other short-or-mid-distance destinations.

For operation, Air Korea will secure three A300s and two B737s. Aircraft maintenance and operation training will be outsourced to Korean Air, which has nearly 40 years of experience in the fields.

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