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FILE PHOTO: An Asiana Airlines Boeing 747-400 taxis at San Francisco International Airport, San Francisco, California, February 7, 2015. REUTERS/Louis Nastro
October 17, 2019
SEOUL (Reuters) – South Korea’s Supreme Court upheld on Thursday a government decision to suspend Asiana Airlines’ Incheon-San Francisco route for 45 days, adding to the debt-ridden carrier’s headaches as it battles rising competition and falling demand.
The transport ministry suspended Asiana Airlines’ once-daily U.S. bound flight as a penalty linked to its deadly plane crash in San Francisco in 2013. Asiana had sought a court injunction against the measure.
The Supreme Court said insufficient staff training was the main cause of the crash and the government’s punishment was legitimate.
The flight ban will be implemented before the end of February, the transport ministry said in a statement.
Asiana would discuss the exact timing of the suspension with authorities, a company spokesman said, adding the punishment would cost it about 11 billion won ($9.3 million) in lost sales.
South Korea’s transport ministry plans to request other airlines to use bigger aircraft for their San Francisco route during the suspension of Asiana flights, a ministry official said, requesting anonymity as he is not authorized to speak to media.
Korean Air Lines, the country’s top carrier, did not have an immediate comment.
Asiana Airlines shares were virtually unchanged in afternoon trading on Thursday in a flat overall Korean stock market.
Asiana Airlines flight 214 crashed in San Francisco in 2013 when the plane’s tail struck a seawall short of the runway, killing three teenage passengers from China and injuring more than 180 out of about 300 people on board.
The airline, which had outstanding debt of 9.60 trillion won as of end-June, nearly seven times its equity, is struggling with falling travel demand to Japan amid diplomatic tension between Seoul and Tokyo.
Its top shareholder is also looking for a buyer to run the carrier.
(Reporting by Sangmi Cha; Writing by Ju-min Park; Editing by Stephen Coates and Muralikumar Anantharaman)