Restructuring centers on customer service, retail-logistics and maintenance; government pledges to preserve employment

Korail President Kim Tae-seung inspects a high-speed train maintenance site at the KTX depot in Goyang on June 9. [Korail]
Korail President Kim Tae-seung inspects a high-speed train maintenance site at the KTX depot in Goyang on June 9. [Korail]

Five subsidiaries of Korail (Korea Railroad Corporation) will be consolidated into three specialized companies focused on customer service, retail and logistics, and maintenance.

The restructuring aims to eliminate overlapping functions and improve convenience and safety for rail passengers. The government said employees of the affected subsidiaries will retain their jobs under an employment succession principle.

The Ministry of Economy and Finance and the Ministry of Land, Infrastructure and Transport said Tuesday that the eighth session of the Public Institutions Policy Committee approved a plan to improve the operational efficiency of Korail's subsidiaries.

The five subsidiaries targeted for consolidation are Korail Retail, Korail Tourism Development, Korail Networks, Korail Logis and Korail Tech. They will be reorganized into three specialized companies: a customer service company (combining Korail Tourism Development and Korail Networks), a retail and logistics company (combining Korail Retail and Korail Logis), and a maintenance company (Korail Tech).

Through the merger, the government plans to unify customer-facing operations — covering station services, train crew functions and tourism — into a single window, and to build a rail-centered public retail and logistics network. It also aims to strengthen rail safety and expand passenger convenience by raising expertise in facility and vehicle maintenance.

The Ministry of Land, Infrastructure and Transport has operated a task force since December comprising Korail, the five subsidiaries, the Korea Transport Institute and outside experts, holding nine rounds of meetings to develop the consolidation plan. The ministry gathered input through a series of interviews with subsidiary labor unions and labor-management-government consultative meetings, and finalized the plan after an external efficiency review.

Once administrative procedures are complete, the government will finalize the mergers and adjust detailed functions within the consolidated subsidiaries to link and integrate overlapping work. Businesses not directly related to customer convenience will be restructured to sharpen each company's specialization.

In addition, the labor-management-government consultative body will continue to operate after the integration to pursue improvements in working conditions and treatment for subsidiary employees.

"This consolidation of subsidiaries is not simply about shrinking the organization or cutting costs — it is a restructuring aimed at improving public services and strengthening rail safety," the Ministry of Land, Infrastructure and Transport said. "We will continue to consult with relevant agencies to ensure employees' job security is maintained on the basis of employment succession."


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