Korean duty free shops raise hope for revenue from flights-to-nowhere services

2020.10.07 14:52:29 | 2020.10.07 16:29:24

[Photo by Kim Jae-hoon]이미지 확대

[Photo by Kim Jae-hoon]

South Korean travel retailers hope to leverage on the “flight to nowhere” trend for relief from business slump caused by a yearlong hiatus in international air travel due to the pandemic.

The Ministry of Land, Infrastructure, and Transport currently is in talks with local airlines on introducing flights to nowhere service, which takes passengers to the skies then returns to the same departing airport, instead of a new destination, for the experience of international air travel that has come to a virtual stop due to the Covid-19 pandemic. The ministry is mulling allowing in-flight duty-free shopping as if the fight is traveling overseas for real.

Some of the local airlines already began selling tickets for flights to nowhere. Asiana Airlines had its tickets for its first no-destination flight scheduled in late October sold out completely in just one day last month.

The duty-free industry which hinges on air travel business jumped on the chance to sustain cash flow. Operators have asked the transport ministry to allow access to airport duty-free shops to the ticket holders. They argue for the same chance to sell tax-free products in the airport as in-flight duty-free shopping is allowed only to international travel ticket holders.

Duty-free shops took a direct hit from the standstill in air travel due to the pandemic.

According to the Korea Duty Free Association, the combined sales of local travel retailers stopped at 1.4 trillion won ($1.2 billion) in August, down 51.2 percent from a year earlier. In the first half of this year, the top 3 duty-free shop operators of Korea incurred combined loss of over 200 billion won.

The travel retailers have been sustaining business by cutting work hours and sending employees on rotational leave, while the government lowered rent fees at airports. But they cannot help unless they can make income.

The duty-free shops for the first time ever had their city outlets left closed on Chuseok holiday last week. They usually enjoyed a peak in Chuseok, one of the longest holidays for travel.

By Pulse

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