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| Hanjin Group Chairman Cho Won-tae / Courtesy of Korean Air |
By Kim Hyun-bin
Hanjin Group Chairman Cho Won-tae has been reappointed as executive director of Korean Air during the 59th shareholders meeting held at the company's headquarters in Seoul, Friday. He received a majority vote of 82.84 percent despite opposition from the National Pension Service (NPS), which holds 8.52 of the company's shares.
Despite his reappointment, many industry insiders believe Korea Development Bank (KDB) will oversee major decisions made by Korean Air as a main creditor of the Asiana Airlines acquisition, and that Cho will be incapable of making meaningful decisions on his own.
Several key issues were addressed during the meeting including the remaining procedures to acquire the country's second-largest carrier Asiana Airlines.
Chairman Cho did not attend the shareholders meeting but his words of greetings were read by Korean Air CEO Woo Kee-hong.
"In order to overcome the country's aviation crisis and to secure a foundation for long-term growth, we have decided to acquire Asiana Airlines," Cho said. "The acquisition procedures for Asiana Airlines are going smoothly. We have submitted a corporate combination report to each country's competition authorities and we are awaiting the results."
Cho says this year's global aviation industry performance does not look all bright as there is an expected shortage of passengers demand due to COVID-19, and pointed to analysis stating it would be 2024 before the airline industry fully recovers to pre-pandemic levels.
"Most global airlines are suffering massive deficits and are barely holding on," he said. "Korean Air was able to create profit due to increased profitability in its air cargo sector which was able to carry on the losses from the passenger sector."
Korean Air suffered a 40 percent decline in passenger sales in 2020 worth 7.4 trillion won compared to the previous year. However, the country's largest carrier was able to better defend its losses through increased cargo demand, which brought in an additional 238.3 billion won compared to the year before.
