Korean Air-Asiana merger yields opportunities for other airlines – part one: European approval


While Korean Air is moving closer to gaining all the regulatory approvals it needs to complete its takeover of its rival Asiana Airlines, the process is also spawning significant opportunities for other airlines, thanks to competition remedies required by overseas regulators.

Korean Air cleared an important hurdle on 13-Feb-2024 when it was granted approval from the European Commission for the proposed merger with Asiana. This followed hard on the heels of a similar approval from the Japanese government on 31-Jan-2024.

The merger has now been given the green light by almost all of the 14 competition authorities in markets served by both Korean Air and Asiana. At the beginning of 2024 there were three key regulators yet to sign off on the deal - those from Japan, the US and the EU.

Now there is just one left - albeit, one of the most important.

Some of the national authorities have exacted a fairly high price to assuage their concerns regarding effects on competition. However, the deal is still very attractive for Korean Air, and will vault it into the top tier of global airlines.

The remedies will see Korean Air transferring slots to the South Korean carrier T'way Air in the European market, and Virgin Atlantic in the UK market. Similar arrangements are likely for Air Premia in the US market.

In some of these cases, Korean Air will also provide aircraft and other resources to the smaller airlines to allow them to start the new routes quickly.

For markets such as Japan and China, slots will be made available by Korean Air if other airlines want to launch services on certain specified routes.

Korean Air has also agreed to sell off the entire Asiana freighter operation after the merger is completed, addressing concerns by some regulators regarding cargo competition.


  • With European approval, Korean Air has gained clearance from 13 of 14 jurisdictions.
  • Korean Air will have to support the LCC T'way Air's entry on four key routes to ensure competition.
  • The major cargo remedy will result in Asiana's freighter division being sold off after the merger.
  • Launching the European routes will mark a major phase in T'way Air's international expansion.
  • T'way Air will be the only Korean LCC offering Europe flights, and the second from Asia-Pacific.

The European Commission is latest to grant approval for Korean Air-Asiana merger - with important caveats

The process of gaining EC approval began in Jan-2021 with a pre-consultation phase, then the merger notification was formally submitted in Jan-2023. After conducting an in-depth review, the European Commission (EC) issued a statement of objections in May-2023.

The concerns expressed by the EC involved the reduction of competition on cargo and passenger services between Europe and South Korea: four passenger routes served by both Korean Air and Asiana were highlighted as being of particular concern.

Solutions offered by Korean Air on the cargo side included the divestment of the Asiana freighter operation. Under this proposal, an advisory firm would be appointed to oversee the sale. A buyer would be selected through a bidding process, Korean Air said.

The EC will need to approve of the selected buyer, and the actual divestment would occur after Korean Air completes the merger with Asiana. The sale would include aircraft, slots, traffic rights, flight crew and other employees, and customer cargo contracts, the EC said.

On the passenger side, Korean Air has agreed to support the entry of another South Korea-based competitor on the four routes in question. T'way Air has been named as the airline that will enter these markets.

These cargo and passenger measures "fully address the competition concerns identified by the Commission," the EC said.

The table below outlines the state of competition in the Europe-South Korea market.

Korean Air and Asiana combined would account for 53.5% of capacity, although the slot carve-outs will reduce this somewhat.

This broad-brush overview also does not reflect the individual markets between major European hubs and South Korea, with capacity share differing widely.

Capacity share in South Korea-Europe market, ranked by weekly seats for the week of 12-Feb-2024

Competition remedies will be a significant boost to T'way Air's international expansion

T'way Air plans to gradually start operations from the second half of this year on the routes from Seoul to Paris, Rome, Barcelona and Frankfurt. Korean Air has committed to "provide comprehensive support" to T'way Air as the airline introduces these flights.

The EC said Korean Air must make "the necessary assets" available to T'way Air to enable it to launch the four routes. These include slots and traffic rights and "access to the required aircraft." Korean Air has committed not to complete the merger until T'way Air is operating the routes, the EC said.

The assets referred to by the EC are likely widebody aircraft that Korean Air would lease to T'way Air.

Gaining four European routes would be a major step change for T'way Air. The airline currently does not operate any flights to Europe, although it is planning to launch service to Zagreb, Croatia in May-2024.

T'way Air primarily flies from Seoul to medium haul destinations in Southeast Asia, Japan and China. However, the airline does have a few longer routes, including one to Bishkek in Kyrgyzstan, and another to Sydney.

The airline operates 23 Boeing 737s, but it also added three Airbus A330s in 2022, which it uses on the Sydney route and some other trunk routes.

Adding the European flights would accelerate the airline's growth trajectory in the international market. For the week of 12-Feb-2024, T'way Air was operating 12% more international capacity than it was in the same month in 2019.

T'way Air international capacity, as measured in weekly seats, from 2019

These moves will also allow T'way Air to dramatically expand its foray into the widebody LCC market, particularly on longer haul routes.

It would become the second Asia-Pacific LCC operating widebodies to Western Europe. Scoot is the other, with its Singapore-Athens-Berlin service using Boeing 787s.

Most Asia-Pacific LCC widebody operations are focused within the Asia-Pacific region - AirAsia X had a foray into European flights, but dropped them in 2012.

South Korea's Air Premia also has flights to Europe, but it is classed as a hybrid, or full service, carrier rather than an LCC.

Part two of this analysis will examine the competition remedies imposed in other markets served by Korean Air and Asiana, including Japan, China and the US.

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