Korean Air President Lee Jong-hee, right, and Incheon Mayor Ahn Sang-soo, pose after signing a contract for cooperation at Ahn’s office, Tuesday. Under the agreement, Korean Air’s budget affiliate, Jin Air, will move its headquarters to the city and Incheon will scrap its plans to establish a regional carrier. / Courtesy of Korean Air |
Agreement Signed to Strengthen Ties With Jin Air
By Kim Rahn
Staff Reporter
Incheon City has scrapped its plan to jointly establish a budget airline with Singapore's Tiger Airways, and has instead, signed an agreement to form cooperative ties with Jin Air, Korean Air's budget affiliate.
The carrier's President Lee Jong-hee and Incheon Mayor Ahn Sang-soo took part in a signing ceremony at Incheon City Hall.
The agreement calls for the two sides to work together to develop the Incheon International Airport as an air traffic and logistics hub for Northeast Asia, according to Korean Air.
Under the pact, Korean Air's budget arm, Jin Air, will relocate its headquarters from Seoul to Incheon. In return for the relocation, the city government will not promote the set-up of an Incheon-based budget carrier, which had been tentatively named Incheon-Tiger Airways.
``Incheon will support only Jin Air, so that the airline can take root in the region and develop,'' a Korean Air official said. It has not been decided what exact support the city will give and whether the city will invest in the carrier.
Incheon and Tiger Airways had been preparing to set up a joint airline since last year. But domestic airlines, both full-service and low-cost, protested the move, claiming the Singaporean airline would virtually control the carrier, infringing on South Korea's aviation sovereignty.
In August, four low cost carriers ― Jin Air, Air Busan, Jeju Air and Yeongnam Air ― jointly filed a petition to request the aviation authorities not to give an operational license to Incheon-Tiger Airways.
Following such opposition, Incheon said it would suspend the establishment. With the cooperation of Jin Air, the city then ended the project.
Korean Air also agreed to cooperate with Incheon on major international events held in the city, including the Global Fair and Festival 2009 and the Asian Games in 2014. It will also help Incheon's other projects designed to make the city a hub of global business and the aviation industry.
rahnita@koreatimes.co.kr
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