EXTRANS GLOBAL - Air Freight News - Week 16 2025

Air Cargo General

1)  Approval of Asiana Cargo Business Sale - 'Integrated Air Incheon' Set to Launch in July

• The sale of Asiana Airlines' cargo business is accelerating towards completion, and if the sale to Air Incheon is finalized in June.
• The only large cargo airline in South Korea that will compete with Korean Air is expected to launch in July this year.
• The Ministry of Land, Infrastructure and Transport approved the business transfer authorization for the cargo business sale plan submitted by Asiana Airlines at the end of last month.
• Asiana Airlines previously signed a sales contract for the cargo business with Air Incheon on January 16, with a sale price of 470 billion won.
• The sale of the cargo business was a necessary issue that had to be resolved as a condition for the approval of the Korean Air-Asiana merger set by the European Union (EU) competition authorities.
• With the aviation authority's formal approval, the sale is seen as having passed a significant milestone. The launch of integrated Air Incheon is targeted for July this year.
• The acquisition consortium led by Sosius, the largest shareholder of Air Incheon, has already secured 250 billion won, including 150 billion won invested by Hyundai Glovis last August.
• They plan to raise additional funding and acquisition financing to pay the remaining balance. Air Incheon has recently established an office in Magok-dong, Gangseo-gu, Seoul, for employees from both companies and is hastening integration preparations by leasing long-haul cargo planes previously operated by Asiana Airlines for trial flights.
• However, there are still regulatory approvals to obtain before the merger, including the Fair Trade Commission's approval of the business combination and operational authorization procedures from aviation authorities in various countries.
• The Asiana Airlines union's opposition to the merger could also be a significant factor in the final stages.

2)  Daemyung Sonoh's Seo Jun-hyuk - Will They Be Able to Embrace T'way Air Next Month Amid Acquisition Challenges?

• Seo Jun-hyuk, chairman of Daemyung Sonoh Group, has encountered obstacles in the ambitious acquisition of T'way Air due to delays in obtaining approval from the Fair Trade Commission for the business combination, which resulted in the failure to enter T'way Air's board last month.
• Minority shareholders of T'way Air are also strongly opposing the sale by taking shareholder action to prevent it, making Daemyung Sonoh's acquisition efforts expected to face challenges.
• Chairman Seo plans to enter the board again next month and embrace T'way Air.
• Daemyung Sonoh Group will hold an extraordinary general meeting on the 23rd of next month to re-propose the appointment of directors, including Chairman Seo, in order to push for board entry.
• Initially, Chairman Seo intended to form a new board at T'way Air during the regular shareholders' meeting held on the 31st of last month to pursue a hostile takeover.
• The board composition to dominate T'way Air's board was also in progress. Despite being criticized for lacking experience in the aviation industry, Daemyung Sonoh aims to include three former Korean Air executives as internal directors to enhance its expertise.
• In fact, Daemyung Sonoh plans to nominate a total of nine candidates for T'way Air's board, including Chairman Seo (non-executive director), Lee Sang-yoon (CEO of Sonoh International's Aviation Business TF, internal director), Seo Dong-bin (CEO of Sonoh International Sales and Marketing, internal director), Ahn Woo-jin (CEO of Sonoh International Sales and Marketing), Lee Kwang-soo (head of Sonoh International Holdings, non-executive director), and Lee Byung-cheon (head of Sonoh International Hotels and Resorts, non-executive director).
• However, the delay in the Fair Trade Commission's approval for the business combination has temporarily suspended Daemyung Sonoh's board entry.
• The review period for the Fair Trade Commission's business combination can be extended up to 90 days from the filing date, but the material supplementation period is not included in the review period, so there is a possibility that the announcement of the approval may be further delayed. It is expected to be announced as early as next month or by June at the latest.
• The remaining payment is 25 billion won, which is 10% of the acquisition price of 250 billion won, and the payment date is likely to occur after the Fair Trade Commission's announcement.
• A Sonoh International representative stated, "We received a request for documentation from the Fair Trade Commission, and the acquisition contract has not been finalized as the business combination review is still ongoing."
• Additionally, the opposition from T'way Air's minority shareholders has emerged as a variable in the sale. The T'way Holdings Minority Shareholders' Alliance is conducting a joint ownership agreement on the shareholder action platform "Act." The joint ownership agreement, which started on the 1st, ultimately recorded 5.49% by noon today, securing over the 5% target stake. With the joint ownership goal met, they plan to actively work to prevent the sale of T'way Air.

3) Air Bridge Chicago - Possibility of Resuming Operations in 2025

• Air Bridge Cargo (ABC), Russia's largest cargo airline, which suspended operations due to U.S. sanctions, is projected to possibly resume operations in 2025.
• Recently, the Russian media outlet Interfax reported that ABC is seeking to return to business about three years after its operations were completely halted by U.S. sanctions in 2022.
• This claim is based on ABC's recently disclosed management report, which states, "We are closely observing geopolitical developments and expect opportunities to implement our plans for resuming operations in 2025."
• Furthermore, ABC is maintaining its current fleet of 14 Boeing cargo aircraft (B777, B747-400, B747-8) in accordance with aircraft manufacturers, aviation authorities, and leasing contract conditions.
• It has been reported that negotiations are ongoing with lessors to fulfill contracts.
• The report also included information about ABC seeking new partnerships in countries friendly to Russia.
• Meanwhile, ABC previously operated an all-Boeing fleet and suspended all operations in March 2022 due to U.S. sanctions against Russia. In August 2024, it was included in the U.S. sanctions list alongside its affiliates Volga-Dnepr and Atran, and in November of the same year, the Russian Federal Air Transport Agency (Rosaviatsiya) suspended ABC's Air Operator Certificate (AOC).
• In its peak year of 2021, ABC handled approximately 639,000 tons of cargo, a 21% increase compared to the previous year, accounting for about 43% of Russia's total air cargo market.

4) Global Air Cargo Rates Show Little Change in the First Week of April, Down 0.1% from the Previous Week (by TAC Index)

• It was a turbulent week for global stock markets, but air cargo rates remained relatively stable.
• According to the TAC Index, the Baltic Air Freight Index (BAI00), which tracks global air freight rates up to April 7, showed a slight decline of 0.1% compared to the previous week, indicating a minor adjustment. However, this figure is still 3.9% higher than the same period last year, suggesting that spot rates remain relatively sturdy.
• There are reports that some e-commerce companies have begun to cancel their Block Space Agreements (BSA) that were set to start in May.
• However, rates on major routes from China continue to rise, particularly due to volcanic activity near Anchorage, a key hub on the Pacific route, which poses potential short-term transportation disruptions and is having a negative impact on the market.
• As a result, the index for routes from Hong Kong rose by 2.9% compared to the previous week, reaching a level 3.6% higher than last year.
• while the Shanghai route index increased by 2.5%, up 5.4% year-on-year. In contrast, routes from other regions in Asia, such as Vietnam and India, generally showed slight weakness.

5) GSA and Airline Trends

• Air Premia (YP) currently has 3 out of 7 aircraft in an AOG (Aircraft on Ground) situation, resulting in the BKK/DAD route being inactive after operating twice.
• There have been repeated delays and cancellations in the North America schedule, with 1 cancellation for LAX, 6 cancellations for EWR, and the HKG route expected to be inactive for the entire month of April.

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