MVA approves $1.5M Jeju Air deal to support Korea-Saipan route after T'Way exit

The Marianas Visitors Authority board approved a $1.5-million sole-source contract with Jeju Air to support direct air service between South Korea and Saipan through Oct. 24, helping maintain the CNMI's largest tourism market following T'Way Air's withdrawal and the disruptions caused by Super Typhoon Sinlaku.

The agreement, approved during a special board meeting last June 11, is intended to support direct scheduled air service between South Korea and Saipan from June 20 to Oct. 24, 2026.

Acting managing director Judy C. Torres said the board approved revised terms and conditions for MVA's Sole-Source Justification for Korea Summer Air Service Continuity program.

"One of the things that we got approved at today's board meeting is the revised terms and conditions with the air service continuity from Korea to Saipan," Torres said following the meeting.

According to MVA's justification, South Korea remains the CNMI's largest visitor source market, accounting for approximately 70% of total arrivals.

MVA said the tourism industry was already facing significant challenges before Sinlaku, including rising fuel costs, increasing airline operating expenses, weakened consumer demand, unfavorable exchange rates and increased competition from other regional destinations.

The CNMI’s tourism body said the typhoon further disrupted the tourism industry and delayed the resumption of international air service. T'Way Air discontinued service to Saipan last May, leaving Jeju Air as the only South Korean carrier committed to serving the destination.

"Jeju Air remains the only South Korean carrier currently committed to providing direct scheduled service between Korea and Saipan," Torres told board members.

MVA said Jeju Air originally planned to resume daily flights in April but delayed operations until June 20 because of airport operational limitations following the typhoon.

The revised operating plan calls for four weekly flights during most of the service period and daily flights during selected peak summer and holiday travel periods. The service will use a 189-seat aircraft.

According to MVA, projected flights have been reduced from approximately 188 flights under the original operating plan to about 85 flights under the revised schedule.

The authority told board members that maintaining direct air service from South Korea is critical to preserving access to the CNMI's largest visitor market and supporting the islands' economic recovery.

"The proposed support should be viewed as an economic stabilization and tourism recovery initiative designed to preserve critical air connectivity during this extraordinary recovery period," Torres said.

MVA warned that the loss of direct air service could lead to further declines in visitor arrivals, reduced economic activity, additional impacts on businesses and jobs, and higher costs to restore airline service in the future.

During board discussion, vice chair Vicky Benavente asked whether Jeju Air would continue flying to Saipan if the sole-source contract was not approved.

"No. Not at all," Torres replied.

The board subsequently voted unanimously to approve the sole-source procurement. The contract now heads to the Office of the Attorney General for review before execution. Jeju Air also has to sign off on the reviewed Sole-Source Justification for Korea Summer Air Service Continuity program.