Airline Suddenly Stops Operations as Staff Resign, Passenger Refunds Delayed Amid Chaos

① Airline that Suddenly Suspended Operations

On August 31st, Hi Air, the only small aviation transport business in the country, suspended its operations. Hi Air explained that the suspension was due to a lack of required personnel following the resignation of many employees. Out of the six flight operation managers, five had left the company. Hi Air announced, “Due to a lack of flight operation managers, a necessary condition for the safe operation of aircraft, operations will be suspended until new managers can be recruited and trained.”

This airline is the only one based at Ulsan Airport and operates five domestic routes and one international route from Muan to Kitakyushu. Hi Air stated that all domestic routes would be suspended from September 1st to the 22nd, and all international routes would be suspended until October 28th.

The airline industry views the cause of Hi Air’s suspension as financial difficulties leading to resignations. There have been instances where Hi Air could not pay its employees on time.

Last year, Hi Air recorded a net loss of 10 billion won (approximately $7.8 million) and a net loss of 11.1 billion won (approximately $8.7 million) in 2021, while its revenue was 15.2 billion won (approximately $11.9 million), showing a significant deficit. In this situation, employee resignations have continued.

Hi Air commenced its first flight on the Gimpo-Ulsan route on December 12th, 2019. On September 25th, 2020, it expanded its domestic routes with the inauguration of the Gimpo-Sacheon route. The airline uses ATR’s 72-500 model aircraft, an eco-friendly option that reduces fuel costs by about 40% compared to similar models. Small aviation transport businesses are legally restricted to operating aircraft with 50 seats or less. Hi Air upgraded its 72-seat aircraft to 50 premium seats to provide a more comfortable environment for its passengers.

② Subsequently, Hi Air Applied for Corporate Rehabilitation

In November 2021, 11 pilots resigned en masse. They filed a national petition alleging unpaid wages and other irregularities, including wage cuts obtained through semi-coercive agreements, unfair hiring practices, workplace bullying, use of outdated equipment, and non-compliance with safety procedures. The airline canceled some domestic flights without explanation or compensation, causing controversy.

Hi Air informed passengers of the flight cancellations three days in advance. At the time, Hi Air stated, “It is true that there have been unpaid wages, and many pilots have expressed their intention to resign, necessitating adjustments to the flight schedule. We apologize for the inconvenience caused to our customers.” The company added, “Executives and upper-level employees, including pilots, have also not received wages for five months. Efforts are being made to normalize the situation.”

The financial difficulties at Hi Air seem to have been ongoing for several years.

③ Passengers Unable to Receive Refunds for Flight Tickets

Hi Air explained that it plans to cancel and refund all tickets purchased during the suspension period. They will start with the earliest departure dates. However, passengers have not received refunds for almost a month, and there has been a lack of proper guidance, leaving them frustrated.

One passenger said in an interview, “I purchased round-trip tickets for myself and my spouse for a flight from Gimpo to Ulsan on September 28th and a return flight from Ulsan to Gimpo on September 30th. The customer service line is unreachable, and although an email address is provided, there has been no response.”

Furthermore, Hi Air informed passengers of the suspension only one day in advance, disrupting their travel plans. Hi Air is currently under legal management, and efforts are being made to resume operations and process refunds. The airline stated that customer service is unavailable due to the expiration of a contract with a partner company. Passengers should contact a dedicated email address with any inquiries.

The suspension of Hi Air’s operations has caused significant inconvenience for passengers at Sacheon Airport and Ulsan Airport. Passengers who use Sacheon Airport to travel between Seoul and Jeju have faced difficulties, and the number of passengers at Ulsan Airport has also been cut in half.

By. Seo Sung Min