Asiana Union "Strongly Opposes Merger to Defend Hanjin Family's Management Rights"

Opposition to M&A Shattering Asiana Airlines
Won Yuseok, CEO of Asiana Airlines, Accused of Breach of Trust

On the 11th, at the Central Meeting Room of the Korean Confederation of Trade Unions in Jung-gu, Seoul, the Asiana Airlines Pilots Union and the Asiana Airlines Labor Union held a press conference opposing the merger of Korean Air and Asiana Airlines.

The pilot labor union and general employee labor union of Asiana Airlines, which is set to merge with Korean Air, have called for opposition to the merger of the two companies. They argue that Asiana Airlines is being dismantled due to the forced merger pushed forward to defend the management rights of Cho Won-tae, chairman of Hanjin Group, despite Asiana Airlines having sufficient self-sustainability. They also plan to file charges of breach of trust against Asiana Airlines CEO Won Yu-seok, and stated that if Asiana Airlines' cargo pilots are forcibly transferred to Air Incheon, they will collectively resign.

The Asiana Airlines Pilots Union (APU) and the Asiana Airlines Labor Union held a press conference on the 11th at the Central Conference Room of the Korean Confederation of Trade Unions in Jung-gu, Seoul, to make these claims.

Han Ye-taek, senior vice chairman of APU, said, "If Korean Air and Asiana Airlines, which occupy more than 60% of the domestic aviation market, merge, a monopoly will be inevitable, leading to fare increases and weakened competition, which will also degrade service quality." He criticized, "Neither Korean Air, the Korea Development Bank, nor the Ministry of Land, Infrastructure and Transport is taking responsible attitudes to address the problems arising during the merger process."

Kwon Su-jeong, chairwoman of the Asiana Airlines Labor Union, also pointed out, "At the time of the merger, it was emphasized that a 'mega airline' would be created to generate synergy effects, but in reality, the core assets of the national airline, such as slots, were consecutively given away to the UK, China, Turkey, Australia, the European Union (EU), and Japan, and the cargo division was also sold off separately." She criticized, "The Korea Development Bank, which should prioritize the interests of its citizens, and government agencies such as the Ministry of Land, Infrastructure and Transport have consistently turned a blind eye to the foreign countries' tyranny demanding the amputation of limbs and even one lung."

She added, "After the deal with HDC Hyundai Development Company fell through once, the Korea Development Bank provided 800 billion won in indirect support to Hanjin KAL to defend Chairman Cho Won-tae's management rights, while simultaneously mobilizing all means to quickly complete fund recovery as the main creditor bank. Ultimately, this acquisition and merger ended up being solely for defending Chairman Cho Won-tae's management rights."

They also criticized the employment succession uncertainty. Choi Do-sung, chairman of APU, said, "APU tried to discuss employees' employment and treatment related to the merger through Korean Air's union by delivering a document containing their position to the field, but they claimed they never received any official document, let alone a response." He explained, "We also submitted a strong opposition to the EU Commission (EC) against the separate sale of Asiana Airlines' cargo division and received a reply from the person in charge acknowledging it."

In response, Korean Air stated, "Since the corporate merger with Asiana Airlines has not been completed, contact with the union raises legal concerns," and added, "As we have repeatedly declared, there will be no artificial restructuring, and we are negotiating with the highest priority on maintaining employment and working conditions for employees who will be transferred to Air Incheon."

APU has stated that if Asiana Airlines' cargo division is sold to Air Incheon, all members will resign. Chairman Choi said, "B747 and B767 flight crew have submitted resignation letters since the 1st, and pilots of other aircraft types have also started submitting resignation letters," adding, "Since employment is an important issue for the EC, we plan to directly visit and inform them of the current situation."

Meanwhile, the union plans to file charges of breach of trust against Asiana Airlines CEO Won Yu-seok. This is because two A350 aircraft, which were supposed to be introduced to Asiana Airlines this year, were transferred to Korean Air without any compensation, causing losses to the company. Vice chairman Han criticized, "If they had operated the aircraft without handing them over to Korean Air, they could have earned tens of billions of won annually, so transferring them free of charge is a clear act of breach of trust."

Asiana Airlines responded, "The number of A350 aircraft to be introduced was not changed, only the schedule was adjusted, so it is unrelated to management breach," and added, "The introduction of A350 aircraft by Korean Air is based on a contract between Korean Air and Airbus, so we cannot confirm the details."