Korean Air (KE, Seoul Incheon) has denied reports that the United States Department of Justice (DOJ) may require the carrier to surrender slots at certain US airports in exchange for approving its merger application with Asiana Airlines (OZ, Seoul Incheon), according to the Korean-language newspaper Viewers. Reportedly, the DOJ wants to see US carriers snag a bigger slice of the market on the US-South Korea country pair.
"It is not true," a spokesperson told the outlet. "The US Department of Justice, which is the competition authority, has not requested the transfer of slots or reduction of operations on specific routes between Korea and the US."
Earlier reports had suggested the DOJ had or would ask Korean Air to handover some slots at certain US airports to US carriers. The two Korean airlines dominate the country pair and there are concerns that dominance may grow after a merger. According to ch-aviation capacities data, Korean Air flies to Atlanta Hartsfield Jackson, Boston, Chicago O'Hare, Dallas/Fort Worth, Honolulu, Las Vegas Harry Reid, Los Angeles International, New York JFK, San Francisco, Seattle Tacoma International, and Washington Dulles. Measured by available weekly seats, it commands a 43.06% market share, while its merger target Asiana has a 24.53% market share. Korean's Skyteam partner, Delta Air Lines, is in third place with a 15.11% market share. Assuming no changes, the merged entity and Delta would enjoy an 82.7% market share.
United Airlines, which has a fifth-placed market share of 5.35%, has opposed the planned merger but is potentially one of the beneficiaries if slots are surrendered. United currently flies to Seoul Incheon to San Francisco. Last month, Korean Air CEO Cho Won-tae said he expected a decision from the DOJ by October.
According to Korean Air, unlike the Korea - European Union routes, the Korea - US country pair is already liberalised and promotes the entry of new competitors, with slots readily available at airports like Los Angeles and San Francisco, and any slot availability at Seoul Incheon a matter for local authorities, not the DOJ.
