Date : 2023-01-11
Incheon International Airport unlocked all of restrictions due to COVID-19 in 2 years and 2 months. President Kim Kyung-wook, who is entering his 2nd year at Incheon Airport, heralded the great transformation of Incheon Airport. President Kim believes that the "post-corona" period will be a new opportunity for Incheon Airport to establish itself as the No. 1 hub airport in Northeast Asia.

However, the regulations on the operation of aircraft have been lifted, due to the worst time in the past 2 years, there are many problems that need to be crossed in and out of normal operation. The deficit that has accumulated as customers plummet to 1/10th, the restoration of interrupted routes and the resumption of duty-free store operations are the challenges for now. Internally, the conflict of employees who have been affected by "national crisis" in the process of switching from irregular to full-time employment must also be healed.
In time for the post-coronavirus period, a strategy was also put in place to increase the airport's competitiveness. It is promoting the development of a large-scale economic project centered on the airport. "All airports around the world are now resuming operations," said Kim Kyung-wook, president of Incheon Airport "and if we don't become competitive on a different level than before, it will be difficult for us to survive the competition.
Money Today met with President Kim Kyung-wook at the Incheon International Airport Building in Incheon City on June 7th. following is a question-and-answer with President Kim.
International flights, which had been restricted from May 8th, have been lifted entirely. Are the preparations for the normalization of airport operations has finished??
Even if aviation regulations such as flight numbers and time limits have been lifted entirely, it will still take time to fully normalize. From the airline's route application, to the government's flight permit, to the sale of tickets, the actual aircraft expansion process alone takes about 2-4 weeks. The airport's main facility operating rate is also planned to expand up to 70% by October this year and 100% by end of this year by the pace of passenger recovery. However, the shortage of personnel needed by airlines, quarantines, customs, etc. must also be addressed. Airlines and relevant agencies need to expand their ground handling personnel, which can be difficult to recover in a short period of time.
- Is the number of customers per year not returning to pre-corona levels?
Before the coronavirus, the daily passengers at Incheon Airport were around 200,000. I think it is difficult to fully recover this year. The maximum is around 140,000 people, which is 70% of before coronavirus. The recovery of the number of passengers is up to the traveling partner country. Even if we are normalized, we cannot help but impose restrictions on the other country. We have to see how the restrictions in China and Japan, which used to make up 30% of the passengers.

- Is Incheon airport behind other airports in other countries?
It is time for airports around the world to resume original operations. Airports in the U.S. and Europe have already reopened operations before the coronavirus, and airports in the Middle East have resumed operations at 70% levels. Asia has a relatively slow recovery. Singapore, the first to resume operations, is around 40%. On the positive side, among competitors at Northeast Asian hub airports such as South Korea, China and Japan, Incheon Airport is the first one to reopen. While Incheon Airport is at the level of 20%, Japan has a difference in recovery rate of about 5%. It could be an opportunity to overcome airport demand in China and Japan.
- The management situation has not been good for the past 2 years. How about this year.
We have suffered a cumulative deficit of 1.2 trillion won in the last two years. This year, a deficit of around 450 billion won is expected. With the cumulative deficit already exceeding 200 billion won by last month, it is difficult to expect a surplus right away. However, the deficit has shrunk to 1/3 of the level of last year, and on a monthly basis, it is likely that by the end of the year, it will pass the breakeven point and return to the monthly surplus.
- What is the new business direction?
Basically, it is a way to move away from the revenue structure that was focused on non-aviation revenues such as duty-free stores and increase the share of aviation revenues such as facility fees
than competing airports. It was a strategy that encouraged various national airlines to fly on routes based on price competitiveness. In the future, the value of the airport should be increased to attract airlines while still receiving similar fees as competing airports.
- Do you have a specific plan to increase the value of the airport?
We are plan to pursue an airport economic development project based in Incheon Airport. The company plans to create Incheon Airport as a multi-cultural space with shopping, business, and entertainment functions, and to expand the concept of the airport from "place to go through" to "place to stay" to create new aviation demand. It is also a way to use the area around the airport to establish a system of airport-related industries such as logistics, aviation maintenance, tourism, and business.
- What is the project of developing the airport economically?
The art Storage project, which is scheduled to open in the second half of 2026. With an investment of about 3800 billion won, the company is developing an art storage with an annual area of 80,3227 square meters.
It is currently negotiating a detailed agreement with Arshexa, the preferred negotiator. An implementation agreement will be signed during the month and the design and construction will begin. Once the handiwork is completed, the company plans to expand beyond a simple art storage area to the infrastructure that underlies the exhibition, auction and distribution of artworks. We expect that new demands will arise for Incheon Airport to see the best artworks and exhibitions.
- Are you saying people visiting Korea to come to Incheon Airport?
Yes. It goes beyond the function and role of the traditional airport and comes to enjoy the airport itself. It is the core of the airport economic development project in connection with the surrounding area.
Currently, the idea of building a 380,000 square meter long-term parking lot site in Terminal 1 into a large-scale landmark complex is also under consideration. Currently, it is in the process of carrying out services for the development plan. In addition, the Yongjongdo Inspire Complex Resort, which has a Korean version of "Las Vegas," is scheduled for completion next year.
- Aviation maintenance infrastructure projects are also being pursued.
This is one of the main projects in airport-related business. The Aviation Parts Maintenance (MRO) business will enter into this agreement with the Israeli IAI and the U.S. Atlas Airlines in the second half of this year.
In 2024, it will also have the most updated complex that provides inspection of all aircraft, including passenger and cargo planes disembarked at Incheon Airport, as well as the maintenance and replacement of parts.
- What is the stage of the construction project for the new airstrip and others (Phase 4 construction plan)?
This year's target process rate is 58.7 percent. With the completion of the Incheon Airport Phase 4 construction project, which will expand the terminal2 and build an airstrip in 2024, the aircraft will operate from 500,000 to 600,000 times a year, and the capacity of international passengers will increase from 77 million to 106 million. Northeast Asia's No. 1 Largest Aviation Infrastructure.
- How about the aviation logistics part?
In the past two years, international flights have decreased by 67% and international passengers by 96%, but the volume of the Incheon Airport Logistics is growing at an average annual rate of 21%. Last year, it recorded an annual volume of 333 million tons, also ranked 2nd in the world in the international air freight rankings.
However, in order to become the world's No. 1 logistics hub, it is necessary to secure additional large-scale logistics complex.
- In the past, we have experienced fairness controversies during the transition to full-time employment, but what changes have been made to the current recruitment policy?
Apart from the right and wrong of the direction, a series of events caused great conflict and hurt between the members. It's still an ongoing issue, and it seems like it's going to take a long time to come up with solution. recruiting is an issue that must be separated from the transition to a full-time job.
According to level 5 general job basis, the recruitment size is intended to remain pre-coronavirus (50-60 people), which is not much different than 40-50 people. In particular, starting this year, we decided to minimize the factors of resume, such as language grades and certifications, which encouraged excessive spec competition. I intend to make sure that candidate doesn't drop out of the paperwork and doesn't even get a chance to take the test. Instead, we will strengthen a competency-based recruitment policy based on the National Occupational Competence Standard (NCS).