Fiasco: Asiana Airlines flies with no meal. Passengers left starving.

This is not a story about Ryanair or Spirit. You are supposed to starve when flying those airlines.
But you would normally expect a good meal on Asiana flight. Not anymore.

Asiana Airlines is facing a massive in-flight meal crisis (link in English) since July 1st. Basically, numerous planes are flying with limited or no meals, and with significant delays as they need to wait for the meals to arrive (if lucky). On July 1st, 36 flights did not have meals and 51 flights were delayed, out of the 80 flights. Yesterday it got better; 18 out of 75 flights forced passengers to starve. This includes some of the longhaul flights; OZ541 flight from ICN to FRA did not have a second meal, even for the business class. And this flight lasts 11 hours. Even the pilot and flight attendant meals are not available, so the pilots are instead eating instant cup noodles. The FAs are giving up their cup noodles for the passengers.

Why this happened? So on July 1st, Asiana changed their catering company from LSG SkyChef Korea (80% owned by Lufthansa, 20% owned by Asiana) to Gate Gourmet Korea. Well, not exactly. Gate Gourmet Korea, a joint venture between Gate Gourmet (owned by HNA group, the parent company for Hainan Airlines) and Asiana Airlines, was supposed to be the new catering company, but its new facility caught fire in March while on construction and the opening is delayed until October (if not delayed even more.)

Instead, Sharp Do & Co Korea (a joint venture between the famed Do & Co and Sharp Aviation K, a Korean catering company) was chosen to be the supplier. The problem was that, Sharp Do & Co is a really small company, which used to supply about 3,000 meals a day until June. But Asiana alone needs about 30,000 meals a day. We all know that a 10x capacity increase overnight is not going to work. As expected, on July 1st, there was an epic fail.

But then why sudden change? Asiana wanted LSG SkyChef, so Lufthansa, to invest about $142 million in Kumho Holdings, a private company owned by Park Sam-koo, the chairman of Kumho Asiana group, and his relatives. (Kumho Holdings owns 46.1% of Kumho Industrial, which then owns 30.1% of Asiana Airlines.) Asiana threatened LSG with the contract extension, which expired in June 2018. LSG, which needed to block the new Asiana-Gate joint venture, counter-offered to Asiana with even larger amount of money, provided that they would invest in Asiana Airlines directly. Asiana declined (?!) and they went with Hainan anyway, who indeed invested $142M in Kumho Holdings. It already sounds like a breach of fiduciary duty, but let's move on. (It was rumored that Park Sam-koo wanted enough money to acquire Kumho Tire, the (company he was forced to give up when the whole Kumho Asiana group was suffering because of his two big strategic failures. He finally gave up re-acquiring Kumho Tire.)

So LSG lost the contract, but this is not their only problem. LSG SkyChef Korea was formed when Asiana sold 80% of their catering company to LSG (thus Lufthansa) when Asiana was financially suffering in 2003. The initial contract was 5 years, and then it was extended for 5 years twice until 2018. But the lease contract for the catering facility runs until 2021. The majority of facility will be superfluous for 3 years, as Asiana was the largest customer which occupied 70% of the supply. LSG will certainly be in the red. Of course LSG sued Asiana, but the result hasn't been out there.

But, LSG was still incredibly generous and maintained a good faith, when the Gate Gourmet Korea facility on construction was totally burned. Asiana could have extended the LSG contract for only 3 months until the facility got recovered. The easiest solution, and the fiasco could have been prevented. Even LSG was willing to do so. But Asiana instead wanted LSG to be the subcontractor for the Gate. LSG declined of course. (Note that this article dates in May 10th. It was indeed foreseeable and preventable.)

LSG even suggested to Asiana that they could provide the meal by one-week basis, not even a full month contract. Asiana even declined that. They really wanted the Asiana->Gate->LSG contract. (Really don't know the reason--Park Sam-koo wanted to please Hainan?) So Asiana went to Sharp Do. & Co., which agreed to be a subcontractor for Gate. But as stated above, Sharp Do. & Co. is a really small company that has only 100 employees. They urgently recruited 40 employees from LSG SkyChef Korea, and Gate Gourmet Korea also dispatched 60 employees to Sharp from overseas. Still, it was not enough to handle 10x capacity increase overnight. The president of the subcontractor for Sharp (thus sub-sub-sub-contractor for Asiana) even committed suicide after the disaster happened, possibly under great stress and fearing the compensation lawsuit. I can't laugh anymore. This is a real tragedy.

Korean Air has their own problems including misuse of power--the infamous nut rage and the recent water rage. But at least they don't fail in the basics this miserably. I'm loyal to Asiana and have a Diamond Plus tier, but I cannot recommend Asiana to anybody for at least 3 months. Just avoid Asiana for while. Unless you want to starve and get $30 duty-free voucher in compensation, which requires you need to fly Asiana again if you want to use it. Absolutely useless. Who wants to fly that airline again?

Update (7/3/2018 2PM EST): The contract between Asiana and Sharp Do. & Co. was revealed in part. Asiana does not have to pay any handling fee if the meal delivery is delayed by 15 minutes. If the delay is more than 30 minutes, then Asiana only needs to pay 50% of the meal price.

The company whose president committed suicide is Hwain CS, the son of the deceased said in the interview. The president worked 28 hours straight before committing suicide. He said the "company" blamed him on the delay, but it is not known whether the "company" is Asiana or Sharp. (The contract flows like this: Asiana->Gate Gourmet Korea->Sharp Do.&Co->Hwain CS.) Hwain was once the subcontractor for the LSG, but when Asiana changed the catering company, they also went with Asiana. The son and other people wanted the company to remain as a LSG partner, but his father did not want to fire 150 employees (as LSG operation becomes a lot smaller after loss of Asiana contract.)

Rest in peace.


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