By Jane Han
Staff Reporter
There is good news for frequent travelers to the Middle East, as Abu Dhabi-based Etihad Airways will be another option on top of the long-running this-or-that choice between Korean Air and the Emirates Airlines.
The development was made possible through Thursday's South Korea-United Arab Emirates (UAE) aviation talks, but domestic flag carriers who are stepping up the offensive against the latest decision are in no mood to welcome the newbie.
The country's No. 1 carrier Korean Air and No. 2 Asiana Airlines argue that the Korean government failed to bring back home any favorable conditions for local companies from negotiations.
``The government is supposed to speak up for its national flag carriers and stand on their side, but the outcome of the talks demonstrates that none of that happened,'' said Lim Jae-won, a Korean Air spokesman.
He claims that the airline industry has been sacrificed for another alternative purpose, such as beefing up bilateral ties with the oil-rich nation, which can potentially reward various construction and energy projects to South Korean firms.
``The aviation talks were basically a channel to give a concession to the other side, for something later in return,'' said Lim.
Through the one-day meeting in Abu Dhabi, government authorities from both sides agreed to allow the UAE state-owned Etihad Airways to launch flights between Incheon and Abu Dhabi, the second-biggest city in the UAE.
Etihad is likely to offer cheaper prices because it receives fuel subsidies and tax breaks from the UAE government.
Four flights will be allowed per week immediately, while an additional three will be permitted starting from 2012, according to the Ministry of Land, Transport and Maritime Affairs, which was in charge of the latest deal.
The service expansion will bring the number of Middle Eastern carriers with UAE-bound flights to 14, more than four times that of Korean Air's three trips per week. Asiana Airlines currently does not operate direct flights to the UAE.
According to Korean Air's internal estimate, the expected financial damage to be generated from Etihad's market entrance totals almost 70 billion won per year. It claims that significant losses will not only come from routes to the Middle East, but also connecting flights to Europe.
Domestic carriers are being urged to quickly snap up ways to compete against Etihad Airways since it is already losing ground against its foreign competitors on price and scheduling convenience.
Despite Emirates Airlines' higher frequency, its occupancy rate for the Dubai-Incheon routes hover at the 80-percent level, while that of Korean Air stands at less than 60 percent, according to industry data.