The UK’s competition regulator has warned that the acquisition of Asiana Airlines by Korean Air could lead to higher prices for passengers flying between London and Seoul.
Korean Air’s £1.2 billion purchase of rival Asiana was first announced in November 2020 but the deal still needs to be approved by regulators in the UK, European Union, US, Japan and China. Although it has been cleared by competition authorities in Australia.
The UK’s Competition and Markets Authority (CMA) found that Korean Air and Asiana were the only airlines currently offering direct London-Seoul passenger services, and their merger could “risk higher prices and a reduced quality of service for passengers”.
Around 150,000 travellers flew between London and Seoul in 2019 and this level of demand is expected to return on the route in the next few years following an inevitable slump in traffic due to the pandemic.
Colin Raftery, senior mergers director at the CMA, said: “Korean Air and Asiana Airlines are the two main players on the London to Seoul route and the deal risks UK customers and businesses paying over the odds or receiving a lower quality of service.
“Should Korean Air and Asiana Airlines fail to address our concerns, this deal will progress to a more in-depth investigation.”
The two airlines now have until 21 November to submit proposals to address the CMA’s concerns. If these proposals are not deemed sufficient then the CMA can decide to refer the deal for a deeper investigation by 28 November.