Korean aviation in flux. Asiana's new CEO comes from LCC Air Busan; AirAsia Korea files application

The Korean market has had few major developments since the launch of a number of low-cost carriers mid last decade. That may change in 2014. Asiana Airlines has named Kim Soo Cheon as its new CEO effective 01-Jan-2014. Mr Kim leads the Kumho Group's flagship business, having served as CEO of part-owned subsidiary Air Busan, an LCC that fought to be recognised and at times appeared to be neglected by Asiana. Mr Kim brought Air Busan to profitability, and at Asiana will have a number of tasks, including bringing the carrier to profitability after it outpaced Korean Air in growth in 2013. Mr Kim will also preside over Asiana's introduction of the A380.

Air Busan may now take on a greater role with Mr Kim now at the top of the airline. This is not a moment too late, as the AirAsia group reportedly filied an application to launch a Korean subsidiary, AirAsia Korea. This would consummate AirAsia's long flirtation with the Korean market, and once again give the LCC group a North Asia subsidiary after it pulled out of AirAsia Japan.

Rival Jetstar already has Jetstar Japan while Tigerair plans to launch a subsidiary in Taiwan. Even VietJet is discussing a Korean venture. AirAsia's entry into Korea will give the market a long-needed adrenalin shot to become more competitive. The short-term would see pressure on Korean LCCs but little on Asiana and Korean Air, although the two would benefit from closer integration and expansion of their LCCs.