Merger of Korean Air and Asiana Airlines

Korean Air and Asiana Airlines merger

Company type	Merger
Industry	Airline industry
Founded	November 2020 (2020-11)
Fate	Merger finalized on December 12, 2024; Asiana brand retired by end of 2026
Headquarters	Seoul , South Korea
Area served	South Korea, international
Key people	Korean Air leadership
Products	Passenger and cargo airline services

Merger of Korean Air and Asiana Airlines

In November 2020, the Government of South Korea announced a strategic policy resulting in the consolidation of Asiana Airlines into Korean Air, establishing a leading airline in South Korea. This merger was finalized on December 12, 2024, after receiving clearance from competition regulators worldwide.

Following the merger, on March 11, 2025, Korean Air declared plans to retire the Asiana Airlines brand by the close of 2026. Concurrently, Korean Air introduced a refreshed logo and aircraft livery—the first redesign in 41 years—crafted by the brand consultancy firm Lippincott, reflecting the unification of the two carriers.

Background

On November 16, 2020, South Korea's Ministry of Land, Infrastructure and Transport revealed Korean Air's intention to acquire Asiana Airlines. On the same day, Korean Air's board sanctioned the merger proposal. The state-owned Korea Development Bank committed to lending 800 billion won (approximately US$655.73 million) to Hanjin Group to support the consolidation of both carriers.

Korean Air is a founding member of SkyTeam, whereas Asiana Airlines belongs to Star Alliance. Following regulatory approval and completion of the merger, the unified airline would join SkyTeam. The Ministry plans to consolidate the low-cost subsidiaries—Air Busan, Air Seoul, and Jin Air—into a single low-cost carrier targeting regional airports within South Korea.

Key elements of the merger plan include dissolving Asiana Airlines into Korean Air, thereby creating South Korea's leading airline entity. Meanwhile, Jin Air and Asiana’s low-cost units, Air Busan and Air Seoul, will be merged into an independent low-cost carrier. Additionally, Korean Air’s leadership has announced intentions to integrate Asiana Club loyalty program members into its SKYPASS system.

In March 2021, Korean Air disclosed that the merger timeline would be extended pending clearance from competition authorities. Until then, Asiana Airlines will operate as a subsidiary with its operational and IT systems managed by Korean Air through 2024.

By June 30, 2021, post-merger integration plans received final approval from Korea Development Bank, subject to regulatory consent.

History

In November 2020, the Korean government put forward a proposal to merge Korean Air with Asiana Airlines, aiming to establish a leading national carrier and support the financially troubled Asiana at that time.

The merger required clearance from antitrust regulators in the carriers' significant markets. In 2021, the U.S. Department of Justice, a critical jurisdiction for the airlines, granted conditional approval subject to further submission and evaluation of additional remedies by the airline.

By February 2023, it became clear that the merger's success depended on obtaining authorization from both European Union and United States regulatory bodies. The Korean government expressed skepticism regarding the likelihood of securing approval from these authorities. Consequently, alternative strategies were considered, including potential equity investments from international partners such as the UAE-based Mubadala Investment Company to sustain Asiana's viability.

Reports in May 2023 indicated that the United States Department of Justice was contemplating legal action to block the merger on grounds of anticompetitive concerns. By June 2023, expectations grew that regulatory challenges would likely prevent the consolidation from moving forward.

In August 2023, the Korea Economic Daily revealed that the Korean Development Bank was preparing contingency plans anticipating the failure of the proposed merger. This shift reflected increasing confidence that American and European regulators would oppose the deal. On September 27, 2023, Yonhap News Agency disclosed that Korean Air had revised its application to the European Commission by offering to divest Asiana’s cargo operations and relinquish slots at several EU airports—including Barcelona, Rome, Paris, and Frankfurt—to address competition issues.

As of February 2024, regulatory approval from one crucial market—the United States—remained outstanding. Following a strategic adjustment whereby Korean Air opted to acquire a 63.88% ownership stake in Asiana Airlines rather than pursue a full merger, the U.S. Department of Justice granted approval in December 2024, enabling completion of the acquisition. Additionally, plans to integrate the frequent flyer programs of both airlines are scheduled for submission to the Federal Trade Commission by June 2025 for review.

Regulatory approval timeline

Country	Status	Details
China	Authorized	Received authorization from the Ministry of Commerce on December 26, 2022.
European Union	Authorized	The European Commission initially lodged a formal objection to the planned merger. A revised application was submitted on November 2, 2023, and accepted on November 3. Conditional clearance was granted by the European Commission on February 13, 2024. Final approval was secured on November 28, 2024.
Japan	Authorized	The Fair Trade Commission approved the merger on January 31, 2024.
South Korea	Authorized	The Fair Trade Commission gave conditional approval on December 26, 2023.
United Kingdom	Authorized	The Competition and Markets Authority approved the merger on May 1, 2023.
United States	Authorized	Initially blocked by the Department of Justice due to monopoly concerns on May 22, 2023. Subsequently approved on December 2, 2024, following a revision to acquire a 63.88% ownership stake instead of full control.

China

On December 26, 2022, the Chinese Ministry of Commerce granted its authorization for the merger between Korean Air and Asiana Airlines.

European Union

The European Commission (EC) published the findings of a comprehensive inquiry on March 17, 2023, determining that the merger would diminish competition by consolidating market dominance between Europe and South Korea. The Commission specifically highlighted concerns regarding decreased competition on passenger flights connecting South Korea with France, Germany, Italy, and Spain, as well as reduced rivalry in air cargo services between Europe and South Korea. Due to the failure of the involved companies to submit proposed remedies within the stipulated deadline, the Commission paused its merger review in June 2023.

In response to regulatory concerns, Korean Air unveiled in October 2023 a set of proposed solutions designed to mitigate antitrust issues. These included divesting flight routes to Barcelona, Frankfurt, Paris, and Rome, transferring these routes along with associated airport slots to T'way Air, a South Korean budget airline, and leasing Airbus A330 aircraft complete with flight crews. Additionally, Korean Air planned to sell off Asiana Airlines' cargo operations, a move that received approval from Asiana's board in November 2023.

On November 2, 2023, Korean Air formally resubmitted its merger application to the European Commission incorporating these concessions. Nevertheless, according to reports from Yonhap, the Commission has yet to recommence its assessment due to incomplete information in the submitted documentation.

By January 2024, Reuters indicated that the European Commission was anticipated to grant approval for the merger following the airlines’ remedial offers. Then in February 2024, Korean Air obtained conditional approval from the Commission for unifying South Korea's aviation sector. This endorsement hinges on identifying a suitable buyer for its cargo division and ensuring that assets are accessible to T'way Air to commence operations on routes servicing Barcelona, Frankfurt, Paris, and Rome.

Japan

In November 2023, Japan formally opposed the merger, highlighting concerns over the dominant market share the combined airline would hold on flights between Japan and South Korea, where it would control nearly 70% of the traffic. The objection also referenced the intended consolidation of the three low-cost carrier subsidiaries affiliated with both airlines.

On January 31, 2024, Japan granted approval for the merger. As part of this consent, the merged airline agreed to relinquish slots on seven specific routes if competitors opt to operate on them. These routes include flights between Seoul–Incheon and Fukuoka, Nagoya, Osaka–Kansai, and Sapporo airports, as well as Busan to Osaka and Sapporo, and Fukuoka routes to rival carriers.

South Korea

The Fair Trade Commission (FTC) of South Korea gave conditional approval for the merger on February 22, 2022. This clearance required the new combined airline to divest certain airport slots and transportation rights in designated areas. The FTC determined that the merger would create monopolies on 26 international and 14 domestic routes but deferred enforcement of corrective measures to foreign regulators by granting a ten-year conditional approval subject to these stipulations:

• Implement structural remedies by transferring domestic and international slots and transportation rights for an additional decade.
• Enforce restrictions including airfare price caps and prohibitions against reducing service supply.
• Ensure the maintenance of customer service quality standards.
• Submit a plan for integrating frequent flyer programs within six months and proceed only after FTC approval.

United Kingdom

In November 2022, the Competition and Markets Authority (CMA) of the United Kingdom delayed its evaluation of the merger, expressing concerns related to potential monopolistic dominance. This postponement allowed Korean Air additional time to present a solution addressing these competitive issues. As a proposed remedy, Korean Air suggested transferring rights for seven weekly slots to Virgin Atlantic, enabling the launch of a London–Heathrow to Seoul–Incheon flight service. The merger received formal approval from UK authorities on March 1, 2023.

United States

Reports in May 2023 indicated that the United States Department of Justice (DOJ) was contemplating legal action to prevent the merger on grounds of antitrust concerns. To secure approval, Korean Air offered to transfer certain operations, including aircraft and flight personnel, to Air Premia. However, this proposal was not accepted by the DOJ. Ultimately, in December 2024, the DOJ granted final consent for the merger after Korean Air opted to acquire a 63.88% ownership stake in Asiana Airlines rather than pursuing a complete integration.

Non-essential countries

Beyond key jurisdictions, the companies sought merger clearance from regulators in markets classified as "non-essential."

The Philippines became the first among these non-essential nations to approve the merger in June 2021. Other countries including Australia, Malaysia, Singapore, Taiwan, Thailand, Turkey, and Vietnam have also granted official approval for the merger.

Public response to the proposed merger

In October 2023, labor unions representing Asiana Airlines employees voiced strong opposition to the merger, arguing that the primary objective of the agreement is to "dismantle Asiana Airlines." They further asserted that this consolidation "does not serve the nation's interests nor benefit the public's convenience."

From a U.S. perspective, an industry analyst characterized the merger as a consolidation involving the largest American carrier connected to South Korea (Delta Air Lines) and the two major South Korean airlines. This union effectively reduces competition on routes between the United States and South Korea. It is noteworthy that Delta holds the largest share in Hanjin Group, which owns Korean Air.