[Advertorial] Eximbank funds $70m for Jeju Air’s plane purchase
The Export-Import Bank of Korea (Eximbank) said Monday that it is providing funds of $70 million to low-cost carrier Jeju Air to help purchase two Boeing B737-800 planes.
The planes are the first to be purchased by the budget airline. They are of the same model as the airline’s existing planes following the company’s single-type-plane policy to maintain low-cost services.
The country’s biggest budget airline by sales currently operates 34 planes, all leased from Boeing.
More LCCs are moving to purchase planes as a revised IFRS16, which recognizes operational lease as debt, will take effect from next year.
The Eximbank said its support for Jeju Air was based on the airline’s contribution to employment and its role in fostering new growth industries.
According to officials, the operation of one additional plane can create at least 50 jobs.
With the launch of new flight routes from Cheongju to Osaka and Muan-Taipei slated at the end of the month, Jeju Air will operate a total of 59 flight routes. Six of them are for domestic destinations.
Set up in 2005 by Aekyung Group, a cosmetics-to-health care conglomerate, Jeju Air had an operating profit of 101.3 billion won last year. It is 59.59 percent owned by the Aekyung Group.