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🇰🇷 South Korea /Economy & Trade

SR CEO Confirms KORAIL Merger by September, Prioritizing Safety and Service Improvement

From Hankyoreh · (22h ago) Korean

Translated from Korean, summarized and contextualized by DistantNews.

TLDR

  • Jeong Wang-guk, the new CEO of SR (the operator of SRT high-speed rail), confirmed the planned merger with KORAIL will proceed by September 1.
  • He emphasized that safety remains the top priority during the integration process and proposed a phased approach where competitive elements are maintained for a period.
  • Jeong also addressed concerns about fare increases and service quality, suggesting that increased seating capacity post-merger will improve reservation convenience and that a unified brand is likely.

Jeong Wang-guk, the newly appointed CEO of SR, the operator of the high-speed rail service SRT, has firmly stated that the integration with KORAIL, the national railway operator, is on track and will be completed by September 1st. Speaking at a press conference for transportation reporters in Sejong City, Jeong asserted that the merger is not merely an administrative consolidation but an opportunity to redefine the future of rail travel in South Korea, focusing on enhanced public service and a clear vision for the industry.

The integration with KORAIL will proceed without a hitch by September. A system where competitive elements remain for a certain period after integration is desirable.

— Jeong Wang-gukConfirming the merger timeline and expressing a preference for a phased integration.

Addressing the accelerated timeline, which moved the completion date up from the end of the year to September 1st, Jeong expressed confidence that the target is achievable through ongoing tripartite discussions involving labor, management, and the government. He highlighted that the integration is expected to proceed smoothly, with organizational consolidation followed by administrative procedures. Jeong stressed that aligning with the government's roadmap is a key responsibility for the head of a public enterprise.

The integration should not just end with the merger of KORAIL and SR. We need to present a vision for how rail transport will provide better services to the public and how it will advance after the integration.

— Jeong Wang-gukEmphasizing the need for a forward-looking strategy beyond the merger itself.

Regarding branding, Jeong anticipates that a unified brand will emerge, either by adopting one of the existing brands or creating a new one, as maintaining separate identities for KTX and SRT post-merger would be impractical. He also touched upon the sensitive issue of fares, acknowledging concerns that maintaining KORAIL's mileage system and introducing additional discounts could strain KORAIL's finances, which are already burdened by accumulated debt and a 15-year freeze on KTX fares. Jeong pointed out that current high-speed rail fares are too low, making ticket reservations increasingly difficult, especially as premium intercity bus services now exceed KTX prices.

It is realistically difficult to use separate brands after becoming a merged company. I expect we will move towards a new brand or adopt one of the existing brands.

— Jeong Wang-gukDiscussing the future branding strategy for the merged railway entity.

Despite these challenges, Jeong reassured the public that the merger will ultimately benefit passengers by increasing seating capacity. He projected an additional 16,000 seats per day and noted that the upcoming direct connection between KTX and SRT lines starting mid-May will further boost seat availability. Above all, Jeong reiterated his unwavering commitment to prioritizing railway safety throughout the integration process, aiming to establish SR as a benchmark for railway safety in the nation.

High-speed rail fares are too low, making seat reservations increasingly difficult. High-speed buses have become premium and their fares have surpassed KTX, but trains are faster and cheaper, so who would take the bus?

— Jeong Wang-gukHighlighting the issue of low rail fares and its impact on service accessibility and competitiveness.
DistantNews Editorial

Originally published by Hankyoreh in Korean. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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