Eastar Air "Securing 10 Aircraft This Year... Aiming for Profit Turnaround Next Year"

Eastar Jet Announces 5-Year Business Plan
"Securing 20 Aircraft by 2027... Achieving 800 Billion KRW in Revenue"

"This year, we plan to expand our fleet to a total of 10 aircraft and introduce them on international routes. Next year, we aim to return to profitability."

On the 14th, Jo Joong-seok, CEO of Eastar Jet, announced this goal at a press conference held at the Courtyard Marriott Hotel in Gangseo-gu, Seoul, stating, "By 2027, we will achieve sales of 800 billion KRW."

Eastar Jet reacquired its Air Operator Certificate (AOC) on the 28th of last month. After suspending all flights due to financial difficulties on March 24, 2020, the airline is preparing to resume commercial flights after three years. The press conference was attended by Eastar Jet CEO Jo Joong-seok, Executive Director of Management Yoo Sang-jong, Executive Director of Sales and Operations Lee Kyung-min, and Maintenance Director Lee Jung. CEO Jo presented Eastar Jet’s five-year business plan, which includes fleet and route expansion, recruitment, and safety investments.

Eastar Jet currently operates three aircraft and plans to increase this number to 10 by the end of this year. The current fleet consists of three Boeing 737-800 models. The airline is negotiating with lessors to add two aircraft in the first half and five in the second half of the year. Starting from the seventh aircraft, Eastar Jet plans to introduce the next-generation Boeing 737-8.

Cho Joong-seok, CEO of Eastar Jet, giving a presentation at a meeting held on the 14th at the Courtyard Marriott Hotel in Gangseo-gu, Seoul. Photo by Yoo Hyun-seok

The 737-8 model is Boeing’s next-generation flagship aircraft, operated in 188 countries worldwide. It has a maximum range of 6,570 km, approximately 1,140 km longer than the existing 737-800 in the fleet. With over 15% improved fuel efficiency, it expands options for medium- and short-haul routes and enhances operational efficiency. CEO Jo Joong-seok said, "During VIG Partners’ acquisition of Eastar Jet, the fleet introduction process was proactively advanced," adding, "Operating funds have been injected, and after the AOC issuance, lessors are actively engaging in negotiations."

Eastar Jet also presented route plans aligned with the fleet introduction schedule. Initially, the focus will be on routes between Gimpo and Jeju from regional airports, with international routes to be actively launched after the introduction of the seventh aircraft. The three current aircraft and the fourth to sixth aircraft to be added will be primarily deployed on the Gimpo-Jeju route and Jeju routes from regional airports. The strategy is to prioritize the use of slots at Jeju Airport to expand domestic supply, thereby enhancing convenience for the public and building trust.

International flights are expected to commence in the second half of the year with the introduction of the seventh aircraft, starting with the Gimpo-Songshan route. Following the seventh aircraft, Eastar Jet will review additional fleet acquisitions and market trends to prioritize popular Japanese routes such as Narita, Osaka, and Fukuoka from Incheon, as well as high-demand tourist routes in Southeast Asia including Vietnam and Thailand. For the China routes, considered a strength of Eastar Jet, the airline plans to actively respond while monitoring route recovery trends.

Jo Joong-seok, CEO of Eastar Jet (second from the left), and executives are seen answering questions from reporters at a meeting held on the 14th at the Courtyard Marriott Hotel in Gangseo-gu, Seoul. Photo by Yoo Hyun-seok

CEO Jo emphasized, "We will enter additional routes with high demand while monitoring the pace of fleet introduction and trends in the air travel market," adding, "By increasing public convenience, Eastar Jet will become a good choice for customers."

Eastar Jet also highlighted improvements in its financial structure following the acquisition by VIG. In January, Eastar Jet secured 110 billion KRW in operating funds, escaping capital erosion. The estimated debt ratio as of March this year is around 150%. Most of the debt consists of deferred payment bonds rather than short-term liabilities, reducing repayment burdens. The liquidity ratio is also secured at over 500%, enabling the airline to resume operations from a financially competitive position.

Alongside the introduction of new aircraft models, Eastar Jet is emphasizing investments in safety. Since last year, the airline has invested over 9 billion KRW in safety and control facilities, training equipment such as FTDs, and IT systems to prepare for AOC acquisition and resumption of flights. Last year, Eastar Jet completed the establishment of an integrated safety management system (ESMS) that collects, analyzes, and manages safety information, laying the foundation for more efficient safety management.

Given Eastar Jet’s possession of many experienced safety personnel, the airline plans to strengthen requalification training for flight, cabin, and maintenance staff as the fleet expands. This year, more than 20 billion KRW will be additionally invested in safety-related facilities, equipment, and training, including spare engines and aircraft parts.

Eastar Jet aims to secure 10 aircraft by the end of this year and achieve sales of 146 billion KRW. Starting with a return to profitability in 2024, the airline has set a goal of operating more than 20 aircraft and reaching 800 billion KRW in sales by 2027. In line with the management plan, about 200 additional hires are expected this year, including former employees who left during Eastar Jet’s rehabilitation process. CEO Jo stated, "At the time of introducing the seventh aircraft, we will reach out to those who left during the rehabilitation process," emphasizing, "We will transparently inquire about their willingness to be rehired."

CEO Jo stressed that as Eastar Jet is reborn, it will become an airline that does its best for the public. To this end, the airline plans to offer various services, including basic reservation services, subscription services, and customized travel services. Regarding systems such as basic reservations and customer management, he said, "Eastar Jet owes a debt of gratitude to the public," and added, "We will strive to repay that debt going forward."