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Japan-South Korea rift

Korean airlines cut Japan flights amid struggle to fill seats

Bilateral row seen having prolonged impact on travel between neighbors

TOKYO/SEOUL -- South Korea's Korean Air Lines and budget carrier T'way Air will reduce flights to Japan amid rising trade tensions between the two countries.

The two airlines said the cuts to low-profit routes were driven by market pressures rather than any boycotts by South Korean travelers following Tokyo's decision this month to slap controls on exports of high-tech materials to the country.

However, with South Korea facing expulsion from Japan's "white list" of preferred trading partners as soon as this week, analysts said the carriers appear to be bracing for a potential drop in demand. Consumer goods including Japanese beer and clothing have already felt the impact of the diplomatic feud.

"Korean airlines are taking into account that they will eventually face a further hit, with fewer business passengers likely to travel if there are stricter trade regulations," said Yoshihisa Akai, founder and chief analyst of Japan Aviation Management Research.

"Diplomatic relations greatly impact travel demand, and it seems the negative trend is to continue for a while, unlike the impact of SARS or terrorism," Akai said, referring to the 2003 outbreak of severe acute respiratory syndrome.

Bookings of trips to Japan at a major South Korean travel company have plunged by nearly 70% on the year during July. A continued decline would deal a heavy blow to tourism-related Japanese businesses. South Koreans account for nearly 25% of total visitors to Japan, trailing only Chinese.

Korean Air recently revealed its plan to suspend the flights between the northern Japanese city of Sapporo and Busan, South Korea's second-largest city after Seoul, beginning Sept. 3 because of increasing competition.

Though the carrier did not disclose the load factor for the flights, "the number of passengers has decreased since May as other airlines also launched their flights in the route," a company spokesperson said.

Korean Air, which conducts code-sharing with Japan Airlines, operates the route three times per week, as does South Korean budget airline Eastar Jet. Fellow South Korean carriers Asiana Airlines and Jeju Air have daily operation for the same route.

South Korea's budget carriers are cutting flights to Japan as well. T'way halted flights between Muan and the southern Japanese city of Oita this month. In August and September, the airline will cut routes linking Busan and Oita, Busan and Japan's Saga, as well as a route linking South Korea's Daegu with Kumamoto.

"The profitability [of these routes] has been low since their launch last November and December," said a company spokeswoman, insisting the trend was apparent long before the recent trade dispute.

Eastar Jet will stop its Busan-Sapporo and Busan-Osaka routes in September, while Air Busan halts flights between Daegu and the Tokyo-area Narita Airport that month as well.

Seoul would become the first country to lose its position on Japan's "white list." As soon as Friday, Japanese companies would need government approval before exporting to South Korea, delaying export procedures and hindering the operations of South Korean manufacturers such as Samsung Electronics, SK Hynix and Hyundai Motor.

The move by Tokyo follows a failure to agree to a solution to South Korean court rulings that have allowed Japanese corporate assets to be seized on behalf of former wartime laborers.

Total visitors arriving in Japan from South Korea during the first half of 2019 decreased by 3.8% on the year, the biggest drop among countries surveyed by the Japan National Tourism Organization. More South Koreans appear to be visiting China as political relations improve, and also Vietnam, a popular resort destination.

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