SEOUL: Shares of South Korean budget carrier Jeju Air hit their lowest on record on Monday, after the deadliest air crash in the country killed 179 people.
Jeju Air shares traded down 8.5% as of 0312 GMT, after falling as much as 15.7% earlier in the session to 6,920 won, the lowest since they were listed in 2015.
The share slide on Monday wiped out as much as 95.7 billion won ($65.2 million) in market capitalisation. Shares of AK Holdings, the holding company of Jeju Air, fell as much as 12% and hit their lowest in 16 years.
The crash on Sunday at Muan International Airport was the first fatal flight for Jeju Air, a low-cost airline founded in 2005 and the country’s third-largest carrier by passenger numbers.
South Korea’s acting President Choi Sang-mok on Monday ordered an emergency safety inspection of the country’s entire airline operation system once the recovery work on the Jeju Air crash is finished.
Among other budget carriers, Air Busan rose more than 15%.
Jin Air and T’way Air fell after rising as much as 5.4% and 7.3%, respectively. South Korea’s two major airlines, Korean Air Lines dropped 1.3% and Asiana Airlines fell 0.8%.
South Korea orders air safety probe after worst crash in country kills 179
“It will take time to assess the cause of the accident, but consumer sentiment will inevitably be hurt, as credibility is important for budget carriers whose seats and services are not much different from each other,” said Yang Seung-yoon, an analyst at Eugene Investment Securities.
“In terms of overall travel demand, there might be some cancellations in the short term, but it is unlikely to weaken structurally.”
Travel agencies shut down their ads and promotional events, with tour package cancellations doubling and bookings halving for one operator, the Yonhap news agency reported.
Many victims of the plane crash, the worst in the country’s history, appeared to be returning from vacation for the holiday season, officials said.
Travel agency stocks also weakened, with Hanatour Service down as much as 7% and Very Good Tour down as much as 11%.
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