Air wave

From clothes to hairstyles, from television dramas to music, cosmetics and food, South Korea has helped define the tastes for many Chinese over the past half a decade.

The next Korean wave may come from the sky: Korean Air sees China as its largest overseas market by 2010.

Although China currently only contributes about 10 percent of Korean Air's passenger transportation revenues, the company is confident about the country's huge potential given close Sino-South Korean bilateral economic relations and Seoul's position as a hub for long-haul flights between China and the United States and Europe.

Korean Air, the country's flagship carrier, launched an aggressive advertising campaign in China in mid-September on leading TV channels, newspapers, magazines and websites.

Korean Air first came to China at the end of 1994 and by October of this year had 25 routes connecting to 19 Chinese cities. It plans to increase the number of its destination cities in China to more than 30 by 2010.

Sino-South Korean bilateral trade reached $134.3 billion last year, rising nearly 20 percent over 2005. The nation is now the fifth-largest trading partner for China and its fifth-largest source of foreign investment. China, in turn, is South Korea's biggest investment destination and second-largest export market.

While vying to become a market leader in the Sino-South Korean route, Korean Air is looking beyond commuting between the two neighboring countries. To further expand its customer base, the company is promoting Incheon International Airport as a hub to connect China with the airline's global network serving North America, Europe and Australia.

About 40 percent of Korean Air's passengers currently make flight transfers in Seoul to the US, Europe and Oceania.

"Although there are more and more direct flights connecting China with the US and Europe, these flights still concentrate in large Chinese cities such as Beijing, Shanghai and Guangzhou. Our advantage is that we fly to 19 Chinese mainland cities and cover a wider network in the country to meet the strong market demand," Korean Air says in a statement.

With China Southern Airlines recently becoming a full member of the SkyTeam, of which Korean Air is a founding partner, the Korean company is confident about its wider reach for global travelers heading to China by connecting to the Chinese carrier's vast domestic network.

On November 15 Guangzhou-based China Southern, the country's largest carrier by fleet numbers, joined SkyTeam, one of the world's three airline alliances, which has 11 members including Air France-KLM, Alitalia and Continental Airlines.

Korean Air and China Southern already have a code-sharing partnership on some routes. The two carriers began a frequent flyer mileage program tie-up on November 1 and will swap cabin attendants on some of their China-South Korea routes starting from December 18.

As the sole Asian airline in SkyTeam, Korean Air acted as the sponsor airline for China Southern. Safety requirements, service quality levels, IT system integration, and frequent flyer mileage programs are some of the numerous items that needed to be standardized to become a full member. Since August of 2004, when China Southern first signed on with its intention for SkyTeam membership, Korean Air helped the newcomer through the rigorous process by providing know-how and necessary IT support.

With the addition of China Southern, SkyTeam now serves about 428 million passengers each year through a worldwide system of nearly 16,400 daily flights covering 841 destinations in 162 countries.

Korean Air has $2.58 billion in revenues during the third quarter of this year, an annual increase of 8.1 percent . Its net profit rose 3.9 percent year-on-year to reach $140 million despite skyrocketing aviation fuel prices.

(China Daily 11/26/2007 page6)