Asiana Airlines crash: Shares plunge as airline faces scrutiny (+video)
Asiana Airlines is facing intense scrutiny after its Boeing 777 flight crashed Saturday in San Francisco. Although shares of Asiana Airlines dropped to their lowest level in three years, an aviation safety expert says he is optimistic about the airline's future.
All eyes are on Asiana Airlines, whose Flight 214 crash-landed in San Francisco and killed two passengers. The results of a federal investigation into Saturday’s Boeing 777 crash will not only affect survivors but also potentially tarnish Asiana’s reputation as a top global airline in the short term.
Answers will not emerge quickly. With the NTSB combing through video footage, examining each seat on the aircraft, and analyzing data from the cockpit, the investigation will last anywhere from several months to a few years, says Robert Mann, president of RW Mann & Co., an airline industry analysis and consulting firm.
The accident has already made investors skittish. On Monday, Asiana shares fell 5.8 percent, plunging to their lowest level in more than three years.
Some analysts say the crash is marring not only Asiana’s image, but also that of other Korean airlines.
“It only takes one incident to undermine years of work Korean airlines have made,” Um Kyung A, an analyst at Shinyoung Securities Co. in Seoul, told Bloomberg.
Asiana is also facing close scrutiny as public attention fixates on the pilot who crash-landed Saturday’s flight.
Though described as an experienced pilot who had logged nearly 10,000 hours flying, Lee Kang-kuk had accumulated just 43 hours on the 777 — which he was still, in an Asiana spokewoman’s words, “getting used to” flying.
With questions arising over how ready Kang-kuk was to fly the 777 and federal investigators considering the possibility of pilot error in the crash, the actions of Kang-kuk and his fellow crew members will be a “focus” of the NTSB’s investigation, Deborah Hersman, NTSB chairwoman, said at a press conference Monday.
If Kang-kuk is found to have been at fault, Asiana will have two fatal crashes caused by pilot errors on its track record — an unflattering plot point. It may also be the subject of dozens of lawsuits lodged by survivors.
But experts predict that Asiana's solid customer service reputation and safety record prior to Saturday's crash could help it weather the short-term fallout. They also predict that United Airlines, which codeshared (partnered with) Asiana on Saturday’s flight, will also likely hold up well.
Although any drop in consumer confidence that Asiana may face will almost certainly be leveled at United as well, airlines that show they take accidents seriously and review their safety protocols can mitigate any fallout that might occur following a crash, Mann says.
“Even when you have a bad individual outcome, you want the aftermath for the airline to be to create a better and more durable situation moving forward. That, undoubtedly, will happen here.”
Asiana and United immediately reached out to consumers. Combined, the carriers have sent 70 of their employees to help provide lodging, food, and transportation for Flight 214’s passengers and families, NTSB's Ms. Hersman said at a press conference Monday.
Asiana’s president was also quick to issue a response to the crash, bowing to a crowd as he apologized to the public over the weekend.
Asiana has also built a strong reputation that may help buoy it through the investigation. The airline has been ranked among the top five global airlines each of the past five years by Skytrax, a leading airport review and ranking site.
Fatal crashes tend to be more damaging to low-fare airlines, like the now-defunct ValuJet. But Mann is more optimistic about the future of Asiana, which has branded itself as a five-star carrier.
“I’ve been in the industry for 35 years now, and it’s safer now than it ever was before,” he says.