{"id":2201728,"date":"2023-07-18T18:28:29","date_gmt":"2023-07-18T09:28:29","guid":{"rendered":"https:\/\/koreapro.org\/?p=2201728"},"modified":"2023-07-19T17:31:45","modified_gmt":"2023-07-19T08:31:45","slug":"financial-turbulence-pilots-strike-threatens-asiana-airlines-merger-plans","status":"publish","type":"post","link":"https:\/\/koreapro.org\/2023\/07\/financial-turbulence-pilots-strike-threatens-asiana-airlines-merger-plans\/","title":{"rendered":"Financial turbulence: Pilots\u2019 strike threatens Asiana Airlines\u2019 merger plans"},"content":{"rendered":"
Asiana Airlines, one of South Korea\u2019s leading carriers, is grappling with a <\/span>pilots\u2019 union strike<\/span><\/a> set to begin on July 24, which initially began last month as a work-to-rule protest over wage increases.\u00a0<\/span><\/p>\n With about 100 pilots threatening to go on strike, the unrest has already led to the cancellation of two international and 10 domestic flights, while delaying another 56 flights, presenting significant operational and financial challenges for the airline.<\/span><\/p>\n Asiana\u2019s troubles could impact its <\/span>planned merger<\/span><\/a> with Korean Air, another flagship carrier, which is currently attempting to acquire the airline. The proposition has been met with varying degrees of <\/span>acceptance<\/span><\/a> and <\/span>resistance<\/span><\/a> from international regulatory bodies \u2014 all citing concerns about how the merger will impact competition.<\/span><\/p>\n Korean Air has spent approximately <\/span>$79 million<\/span><\/a> (100 billion won) in legal advisory fees worldwide over the past two years. Hence, the company has a strong incentive to push ahead with its <\/span>$1.4 billion<\/span><\/a> (1.8 trillion won) deal. However, if the deal goes through, Korean Air would also be legally responsible for Asiana\u2019s debts and liabilities, thus giving it an incentive to participate in negotiations on Asiana\u2019s wage disputes.<\/span><\/p>\n FINANCIAL LOSSES<\/b><\/p>\n As the work-to-rule protest escalates into a full-blown strike, flight cancellations and delays will impair Asiana\u2019s reliability in the eyes of its customers and potentially lead to a loss of market share as travelers might opt for more reliable airlines. The direct financial impact is also substantial, with the cost of cancellations, delays and increased maintenance likely eating into the company\u2019s revenue.<\/span><\/p>\n