Fly Gangwon has suspended all operations, effective 20-May-2023 to 30-Jun-2023, citing financial difficulties. The airline is planning to apply for court receivership next week.
Fly Gangwon began operations in November 2019 after obtaining a certificate from the Ministry of Land, Infrastructure and Transport offering flights on five international and two domestic routes.
The airline suffered heavy losses and failed to make payments for the lease of chartered planes due to the impact of the COVID-19 pandemic.
"A homegrown private equity fund signed a memorandum of understanding with the company to inject 100 billion won (US$75 million) but has recently withdrawn its planned investment after conducting due diligence on the company," said a spokesperson of Fly Gangwon to Yonhap News Agency.
A total of 38,000 people have booked flights on the Yangyang-Jeju Island route and five international routes by the end of October, according to the ministry. The airline will operate the Yangyang-Jeju till May 19.
For the rest of the flights the airline will initiate a full refund of all purchased tickets without sees,
The government will have Fly Gangwon take full responsibility for the damages it caused to customers and make efforts to minimize the inconvenience of local residents who have used the Yangyang airport in Gangwon Province.
Fly Gangwon Chief Executive Joo Won-suk owns a 55% stake in the debt-ridden carrier, and the remainder is held by others.