Korean Economy News
Meal crisis may spell serious trouble for Asiana Airlines

By Moon Ji-woong and Lee Ha-yeon

While its bigger rival Korean Air Lines struggles with publicity blow from owner family shame, the other sole full-service option in Korea, Asiana Airline, grapples with its own crisis from catering disruption that has delayed flights or sent off passengers to endure 12-hour flight without a meal.

Since Sunday, passengers of Asiana Airlines had to endure hours of delays and have been forced to go on journeys - both short- and long-haul - without a meal. The airliner has been giving out travel vouchers of $30 to $50 to ask passengers to pack their own meal onboard.

On Monday, 18 out of 75 international flights operated by the carrier were delayed more than an hour and 16 short-haul flights to Japan and China even departed from the Incheon International Airport without in-flight meals. On Sunday, 51 flights departed behind schedule and 38 left the airport without meals to feed passengers.

The airliner on Tuesday posted apology on its website over the inconvenience caused by a shift in catering service provider, promising to normalize the situation as soon as possible.

But with little sign of easing, the meal crisis only led to a greater problem for the carrier after the stressed-out head of the temporary in-flight meal supplier was found dead from apparent suicide, raising suspicion about the airliner dumping the responsibility from its poor choice on a small supplier.

Sharp Do & Co Korea, a small-sized local catering firm, was temporarily assigned from July 1 to cover the orders of 20,000 to 30,000 meals per day for the carrier even as daily capacity topped 3,000 after a fire disrupted production from Asiana’s primary supplier Gate Gourmet Korea.

Asiana recently ended contract with LSG Sky Chefs, a subsidiary of German airline Lufthansa and primary in-flight meal supplier for 15 years, and created a unit called Gate Gourmet Korea (GGK) with China’s HNA Group to handle its in-flight meal for 30 years.

But a fire at a new facility caused the airliner to sign a three-month contract with one of GGK’s subcontractors - Sharp Do & Co. - which failed from the first day of delivery on Sunday.

The meal trouble caused a bigger headache after the CEO of the subcontractor was found dead at his home on Monday after struggling day and night to meet the demand and deal with the delivery glitches.

Moreover, some media outlets began to raise questions on unfair deals behind the debacle. LSG Sky Chefs, the only capable supplier Asiana can turn to, reportedly has refused to help out citing customs regulations and breach of trust. The company reportedly was pressed by Asiana to purchase bonds with warrants issued by parent company Kumho Holdings and the contract broke down after it resisted.

Coincidentally, HNA purchased 160 billion won ($140 million) in bonds with warrants issued by Kumho Holdings in September last year.

On Tuesday, shares of Asiana Airlines closed down 0.12 percent at 4,020 won ($3.60) in Seoul from the previous session.

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