By Kim Rahn
Staff Reporter
Battered by soaring fuel costs, airlines are racking their brains to come up with countermeasures.
Korean Air, the nation's largest carrier, spent some 2.65 trillion won on purchasing jet fuel last year, while Asiana, the second largest, spent some 1 trillion won.
If the fuel price rises by $1 per barrel, in the case of Korean Air, it has to pay an additional 29 billion won annually. The price of Mean of Platt's Singapore, a crude oil benchmark, was $110 per barrel at the end of last year, but rose to $130, meaning Korean Air needs to spend 580 billion won more than last year.
What makes matters worse is the fall in the value of the won against the dollar. Airlines buy fuel in dollars and a weaker won raises import costs.
Last year, the local currency was trading at 930 won per dollar. But the won-dollar rate is now hovering around 980-1,000 won. Korean Air has to pay an additional 17 billion won to import fuel per year when the local currency fell by 10 won against the dollar.
As fuel costs are likely to remain high for the time being, carriers have come up with various steps to deal with it.
One of the measures is a fuel surcharge, an extra fee on the ticket price.
The surcharge changes every month according to the previous month's oil price, and the two carriers can decide to raise the charge in April following the fuel price hike this month.
Korean Air's surcharge on the long-range routes to America, Europe, Middle East and Africa will increase from $86 to $122 for a one-way ticket, while that on the short-haul routes to China, Mongolia, Southeast, India, Guam and Japan will rise from $38 to $54.
Asiana will apply the same extra charges, and the surcharge for Saipan will increase from $20 to $28.
Another measure to save fuel costs is reducing the weight of the aircraft, as the heavier a plane is, the more fuel it uses.
Airlines now carry less food, less water, and less magazines and books than before. Among several leaflets and brochures placed in each passenger's seat, Asiana Airlines removed three in 2005. It will also reduce the number of in-flight magazines, some 160, by 20 percent.
Cleaning aircraft engines with water is another option, as removing foreign objects stuck in engines increases fuel efficiency. Korean Air saved 2.3 billion won last year by washing engines.
Airlines also attach a winglet, a small wing, at the end of the big wings. A winglet decreases air resistance at the end of the big wings and thus increases fuel efficiency. Korean Air attached winglets on six planes in 2006 and saved 820 million won per year.