[Aircraft Disaster] Gwangju Travel Industry Hit Hard... 20,000 Cancellations in Two Weeks

Sales Plummet, Making Loan Repayment and Staff Retention Difficult
Urgent Need for Government Loan Deferrals and Support for Land Operators
"Closure Date for Muan Airport Must Be Set and Alternatives Proposed"

On the morning of the 5th, officials are inspecting the localizer at the Jeju Air passenger plane accident site at Muan International Airport, Jeollanam-do. Photo by Yonhap News

The travel industry in Gwangju is facing management difficulties as a series of unfavorable events, including the December 29 Jeju Air passenger plane disaster, weakened travel sentiment, and the indefinite closure of Muan International Airport, have led to a surge in cancellations from travelers.

Since most users of Muan International Airport are Gwangju residents, these cancellations have directly impacted the sales of local travel agencies, highlighting the need for targeted support for the travel sector.

According to Gwangju City and the Gwangju Tourism Association on the 21st, as of the 13th, 137 out of 564 travel agencies in Gwangju had reported damages to the association due to the December 29 Jeju Air passenger plane disaster.

The reported damages are related to travel cancellations for trips departing from Muan International Airport in Jeonnam during January and February this year, totaling 1,777 cases (20,701 canceled travelers). With average sales per person estimated at 1.5 to 2 million KRW, the total sales loss is projected to reach 30 billion KRW. The damage is expected to increase further when unreported cancellations are included.

With the sudden plane disaster and the indefinite postponement of Muan International Airport's reopening, the Gwangju travel industry is now struggling to stay afloat.

For example, in Dong-gu, Gwangju, a travel agency run by Mr. A saw over 70 people cancel trips departing from Muan International Airport after the disaster. This figure only includes pre-booked trips that were canceled; Mr. A explained that if ongoing reservations and the overall decline in travel sentiment are considered, the actual damage is even greater.

As a result, Mr. A, whose office typically operated with three to four employees, had to let staff go to save on labor costs. Currently, Mr. A is running all operations alone, with one employee occasionally coming in to work.

With the travel industry facing another downturn after the COVID-19 pandemic, Mr. A appealed for an extension of government loan repayment periods, such as the Tourism Promotion and Development Fund and Special Financial Support for Small Tourism Businesses, which were received during the pandemic.

Mr. A said, "During COVID-19, most local travel agencies received government loans ranging from 50 million to 150 million KRW. Although sales had recently recovered enough to repay about half, the sudden disaster led to mass cancellations, making it impossible to repay the loans right now."

He added, "Normally, travel agencies rely on peak winter season sales to get through to the summer, but with cancellations and the suspension of both individual and group travel during the off-season, the actual damage is far greater than it appears. It's hard enough to hire staff, so at the very least, loan repayment periods need to be extended."

Gwangju's travel industry is emphasizing the need for targeted support tailored to the unique characteristics of the sector, such as classifying the industry as a special disaster sector. They are calling for practical measures, including loan repayment deferrals for each agency, employment retention subsidies, and low-interest loans for charter flight operators departing from Muan Airport.

They also stressed the need for a definite announcement of Muan International Airport's reopening date and alternatives in case of further delays.

Previously, on the 18th, the Ministry of Land, Infrastructure and Transport announced, "To implement follow-up measures after the Jeju Air passenger plane accident, the runway closure period will be extended by three months until 5 a.m. on April 18. The timing of the airport's reopening remains flexible, but we will quickly take the necessary steps to ensure safe and normal airport operations."

Regarding this, Shin Seokhyun, president of the Gwangju Tourism Association, said, "Since most users of Muan International Airport are Gwangju residents, local travel agencies inevitably suffer damages. Although the scale of damage varies by company, current sales make it difficult to manage loan repayments."

He continued, "For land operators running overseas charter flights, not domestic ones, they are also responsible for refunds due to cancellations, so the damage is even greater. The closure date of Muan Airport must be clearly set so that travel agencies can prepare their own travel products and countermeasures."