Sign Up Now for
7J7 Updates and
Exclusive Content !
only $27 /year

Receive thousands of updates and pertinent information for all airlines, especially the ones that matter most to you!

We take the guess work out of flight and airport data — we are the most up-to-date resource for international airline information.


7JetSet7 Code: JAS
Status: Operational
Region: ORIENT
Country: JAPAN
Employees 4357
Web: jal.co.jp
Email: info@jal.co.jp
Telephone: +81 (3) 5460 6600
Fax: +81 (3) 5769 6487

Click below for data links:
JAS-2013-10 - A350-900 A350-1000 XWB ORDERS
JAS-2015-07 - Android WearTM Countdown app.jpg
JAS-2015-08 - Top 10 Premium Economy - 10th.jpg
JAS-Domestic Network - 2015-12.jpg
JAS-Global Network - 2015-12.jpg
JAS-Regional Network-A-2015-12.jpg


TOKYO 140-8605, JAPAN

TOKYO 144-0041, JAPAN




$820M, 7 ORDERS (FEBRUARY 1996) 777'S (PW4084).


1 A300B4-600R (PW4158) DELIVERY.

JANUARY 1994: 1993 = -$103.8 MILLION.

DECEMBER 1994: 1 A300B4-600R DELIVERY.


1 A300B4-600R DELIVERY.

JUNE 1995: 1 MD-90-30 (V2525-D5) DELIVERY.



1 747-200B (JT9D-7A) TO JAPAN AIRLINES (JAL). 1 A300B4-600R (PW4158) DELIVERY (5TH IN 12 MONTHS).



DECEMBER 1995: 1ST OF 10 MD-90-30'S (V2525-D5) DELIVERY.

MARCH 1996: $220 MILLION, 6/1 ORDERS (FEBRUARY 1997) MD-90'S, FOR TOTAL 16.







LAST 6 MONTHS = +5 BILLION Y (+45%).



DECEMBER 1996: 1ST 777-200 (PW4074) DELIVERY, 380 PAX, 3 CLASS.





MAY 1997: (http://www.jas.co.jp).





2 ORDERS A300-600R'S (PW4158). NOW OPERATES 34 A300'S. 2 MD-90-30'S (53559; 53560) DELIVERIES.

JULY 1997: 2ND 777-289 (WA207) DELIVERY.


9TH MD-90 DELIVERY. +2 ORDERS (1998) A300-600'S (PW4158).







3RD 777 (27638) DELIVERY.


3 MD-90'S (V2500) DELIVERIES.








3 MD-90'S (2202; 2211, & 2212) DELIVERIES (NEXT ONE IN JULY 1998).



5TH 777-200 DELIVERY (PW4084).

PASSENGERS (PAX) (M): 7 ANA 41; 8 CAL 39; 9 DLH 35; 10 BAB 34; 11 JAL 32; 12 KAL 26; 13 ALI 25; 14 TWA 24; 15 SAS 21; 16 QAN 19; 17 AMW 18; 18 JAS 17; 19 IBE 15; 20 GUN 15; 21 TII 15; 22 KLM 15; 23 ACN 14; 24 ANS 13.

RETURNED 2 MD-81'S (48070; 48072) TO LESSOR, JFS AIRCRAFT HOLDING. 1 MD-90-30 (53559) DELIVERY.




MD-90-30 (53560) DELIVERY.





MAY 1999: 7TH 777-289 (PW4074) (27642, JA010D) DELIVERY.


33 ANZ 11.15; 34 ANS 10.14; 35 SAA 9.85; 36 SAB 9.53; 37 BEJ 9.07; 38 JAS 8.77; 39 THY 8.10; 40 EAD 8.07; 41 AIN 7.68; 42 ELA 7.55.

JULY 1999: FISCAL YEAR (FY) 1998 = +540 MILLION Y (-1.8 BILLION Y).






1ST 6 MONTHS = +$39 MILLION. DEBT = $3.7 BILLION. 1998 = +$2.00 MILLION (+$1.4 MILLION): 8.77 BILLION (RPM) TRAFFIC (+6.1%), 779.8 MILLION (FTM) FREIGHT TRAFFIC (+6.7%).









2 DC-10'S (48315; 48316) SOLD TO NORTHWEST AIRLINES (NWA).


JULY 2000: 1999 = 15.27 BILLION RPK (+8.2%); 61.8% LF; 162.94 MILLION (FTK) (+21.3%); 20.60 MILLION (PAX) (+5.5%); 5,994 EMPLOYEES.









APRIL 2001: 2000 = +$9.8 MILLION (NET PROFIT).





LAST YEAR'S DOMESTIC MARKET SHARE: 1 (ANA) 42.5%; 2 (JAS) 21.9%; 3 (JAL) 21.8%; 4 (ANK) 6.5%





1 UAL 116.60; 2 AAL 106.15; 3 DAL 97.60; 4 NWA 73.11; 5 BAB 64.24; 6 AFA 59.54; 7 CAL 58.76; 8 DLH 56.76; 9 JAL 50.77; 10 USA 45.93; 11 SWA 44.50; 12 SIA 42.76; 13 QAN 42.14; 14 ACN 41.49; 15 KLM 35.76; 16 ANA 33.16; 17 CAT 27.81; 18 TII 27.43; 19 IBE 25.64; 20 KAL 23.73; 21 ALI 22.45; 22 MAS 22.29; 23 AMW 19.06; 24 VAA 17.65; 25 VAR 16.02; 26 CHI 16.00; 27 EAD 14.37; 28 SAS 14.26; 29 ANZ 13.54; 30 SAA 12.70; 31 SVA 12.56; 32 BEJ 12.39; 33 ASA 12.23; 34 JAS 10.06; 35 THY 9.35; 36 AMX 8.51; 37 PAL 8.36; 38 GIA 8.15; 39 CMA 7.99; 40 ELA 7.79; 41 GUL 7.65; 42 PIA 7.24; 43 AIN 7.10; 44 TAP 6.43; 45 EGP 5.53; 46 OLY 5.24; 47 AUL 5.06; 48 FIN 4.93; 49 IND 4.52; 50 CQT 4.51.


April 2002: 5,034 employees.

Main Base: Tokyo (Narita International) Airport (NRT).

Owners/shareholders: Japan Airlines (JAL) (8.25%).

May 2002: Heavy maintenance contract for 39 A300/-600's, to Thai Airways International (TII).

July 2002: 2001 = +$7.4 Million (-56%) (+$16.8 Million): 16.21 Billion (RPK); 63.4% LF; 21.76 Million PAX; 176.67 Million (FTK); 5,034 employees (-11.2%).

August 2002: A300B4-622 (836, JA014D), delivery.

September 2002: 1 A300B4-622R (837, JA015D) delivery. A300B4-2C (174, JA8277), sold to Rubloff Jet Support.

October 2002: Japan Airlines (JAL) and Japan Air System (JAS) integrated their operations under a new holding company: JAPAN AIRLINES SYSTEM CORPORATION, becoming the 6th largest airline group in the world. Isao Kaneko, is President & CEO of the new holding company, which has 122 employees. The Misuho Financial Group is the largest stockholder, followed by Tokyu Corporation, which was the top (JAS) shareholder.

(JAL) changed its corporate image. An "Arc of the Sun" theme retains the familiar "JAL" font, but replaces a red and grey stripe with a red, silver, and black swoosh, through the initials. (JAL)'s stylized crane symbol, that mimics the rising sun on the tail, has given way to a red sun outlined in silver, that nearly eclipses the tail. The basic airplane color is off-white. The red was chosen because it is the symbolic color of Japan, and incorporates "the two key concepts of Skyward Dreams and Joy." Silver expresses professionalism, quality, and innovation, while black represents dependability, and versatility. Japan Airlines Domestic (JAS)'s coloring was expressed in a blue, red range, and yellow hash mark.

In the 2nd integration phase to start in April 2004, the two companies will completely merge their operations into 3 group firms: Japan Airlines International Company (JAL); Japan Airlines Domestic Company (JAS); & Japan Airlines Cargo Company.

Japan's Ministry of Land, Infrastructure & Transport is emphasizing development of the new, Centrair international airport to open in Nagoya in 2005, and upgrades to Tokyo's Haneda airport in its $4.1B airport improvement budget for 2003. $1.1 billion is for construction of a 4th runway at Haneda (Asia's busiest airport, even though it serves mainly domestic Japanese routes. $388 million has been allocated for Aichi-Japan International Airport - Centrair. Other major projects include $114 million for Narita, and $367 million for a 2nd runway for Osaka Kansai International Airport. Other funding goes for noise abatement, and air traffic control (ATC) upgrades.

21st A300B4-622R delivery.

November 2002: 6 months ending September 2002 = + Y 3.4 billion (-30.1%) (+ Y 4.8 billion).

During the period, Japan Air System (JAS) cut international flights in and out of Osaka Kansai, and shifted all international operations to Tokyo Narita.

1 A300B4-2C (089) parted out. A300B4-622R (838, JA016D) delivery.

December 2002: Japan Airlines Systems Corporation, the new holding company that will oversee the merger of (JAL) and (JAS), forecasted Fiscal Year 2002 at end of March 2003 = + Y 24 billion.

A300B4-622R delivery.

January 2003: Japan Airlines (JAL) will take over all Japan Airlines Domestic (JAS)'s Osaka (Itami)/Tokyo (Haneda) - Fukuoka/Naha/Sapporo services.

February 2003: As part of the (JAL)/(JAS) merger, both have split flights at 9 domestic airports where they both operate. (JAS) will operate all flights from Akita, Hiroshima, Kumamoto, Nagasaki, Miyazaki, Kagoshima, and Kochi. (JAL) and its JAL Express (JEX) subsidiary, will fly from Naha and Komatsu.

March 2003: Next month, Nagoya - Kagoshima, Niigata - Fukuoka/Sapporo (CTS), Osaka (ITM) - Memambetsu, Tokyo (HND) - Akita/Yamagata. Resumes Osaka (KIX) - Guangzhou/Kunming.

Fiscal Year 2002 = - Yuen 22.6 billion/-$70 million. (JAS) will eliminate -3,600 jobs.

April 2003: 4,900 employees. SITA: TYOGGJD.

Parent organization/shareholders: Japan Airlines (JAL) (8.25%).

Owns: Amusaka Airlines (2%); Harlequin Air (HAQ) (100%); Hokkaido Air System (51%); & Japan Air Commuter (60%).

Japan Airlines Domestic (JAS) is a major Japanese carrier operating an extensive domestic network, together with international services and charter flights throughout southern Asia.

Domestic, Scheduled Destinations: Akita; Amami O Shima; Aomori; Asahikawa; Fukuoka; Hiroshima; Izumo; Kagoshima; Kita Kyushu; Kochi; Komatsu; Kumamoto; Kushiro; Matsumoto; Matsuyama; Memambetsu; Misawa; Miyazaki; Morioka; Nagasaki; Nagoya; Nanki Shirahama; Niigata; Obihiro; Oita; Okayama; Okinawa; Osaka; Sapporo; Sendai; Takamatsu; Tokunoshima; Tokushima; Tokyo; & Yamagata.

International, Scheduled Destinations: Guangzhou; Hong Kong; Kunming; Seoul; & Xi An.

May 2003: Japan Airlines Systems Corporation, the holding company for (JAL) & JAS) Fiscal Year 2002 = + Y 11.6 billion/+$100 million (- Y 35.7 billion).

1 A300B2K-3C (163) & 2 A300B4-2C's (110; 94) sold to Fly Air (FLM).

June 2003: 2 777-246ER's (32892, JA704J; 27656 JA771J) deliveries.

July 2003: 5,240 employees. SITA: TYOGGJD.

(JAL) System Fiscal Year 2002 = +$95.24 million (-$285.96 million): (JAL): 83.54 billion (RPK) (+1.9%); 71% LF; 33.63 million (PAX) (+3.3%); 4.39 billion (FTK) (+6.7%); (JAS): 16.02 billion (RPK) (-1.2%); 62.8% LF; 21.43 million PAX (-1.5%); 176.40 million (FTK) (-.2%).

40 (BRI) 18.43; 41 (ARO) 17.65; 42 (CDF) 17.41; 43 (AUL) 17.34; 44 (AAR) 17.33; 45 (GIA) 16.72; 46 (THY) 16.59; 47 (ATZ) 16.30; 48 (LTU) 16.10; 49 (JAS) 15.90; 50 (HAP) 14.40; 51 (JMA) 13.97; 52 (PAL) 13.52; 53 (AMX) 13.31; 54 (AIN) 13.25; 55 (FIN) 12.79; 56 (BER) 12.73.

777-246ER (32893, JA705J) delivery.

August 2003: As part of the continuing integration of Japan Airlines (JAL) and Japan Air System (JAS), the (JAL) Group is consolidating passenger handling subsidiary companies operated by the two carriers at 5 major domestic airports in Japan and amalgamating 4 regional reservation and ticketing centers in October. Five (JAL)-operated passenger handling companies at Sapporo, Sendai, Tokyo, Osaka, and Fukuoka will merge with 4 (JAS) companies at Sapporo, Sendai, Itami, and Fukuoka. The 5 new companies formed as a result, will be renamed (JAL) "Sky." 4 regional (JAL) domestic reservation & ticketing centers located at Sapporo, Tokyo, Osaka, & Fukuoka, will merge with 3 (JAS)-owned facilities under the new company name (JAL) "Navia." They will be subsidiary companies of (JAL) Sales Co Ltd, the domestic passenger sales & marketing unit of the (JAL) Group.

September 2003: (JAL) Group $850, +7 orders (2004-02) 767-300ER's, 2 class, 237 PAX, to replace (JAS) A300B's.

January 2004: JAL grounds its fleet of 25 MD-81/-87's to inspect their (JT8D-217) engines. Found damaged engines on 18 airplanes. Cancelled 42 flights affecting about 4,100 passengers. (JAS) operates a total of 390 daily domestic flights, including 138 with its MD-81/-87's.

February 2004: Code share with Air France (AFA), Nagoya - Paris (CDG) (777-200ER).

March 2004: Osaka & Tokyo to Hangzhou, Osaka to Qingdao.

Next month, the (JAS) identity disappears. In June, the parent company becomes Japan Airlines Corporation, with Isao Kaneko, Chairman & (CEO); Toshiyuki Shinmachi, President; Hidekazu Nishizuka, Executive VP; Takashi Mazuko, retires; Katsuo Haneda, President (JAL) International (JAL); Minoru Morikawa, retires; Mitsuo Komatsubara, President (JAL) Domestic (JAS); and Hajime Kato, Executive VP.

With passenger traffic (RPK)s hit hard by the outbreak of (SARS) last year and by the bird flu this year, (JAS) stated its 2003 loss will be greater than expected. Plans to reduce its workforce by -4,500 (-7.8%) by March 2007.

April 2004: Integration of Japan Airlines (JAL) and Japan Air Service (JAS) is completed with the launch of two new airlines, (JAL) International (JAL), and (JAL) Domestic (JAS). Instead of referring to the two companies separately, it will operate under the brand name "Japan Airlines."

(JAL) Group (CEO), Isao Kaneko stated "We have completed the initial task. We have integrated networks, sales, back-office functions, airport operations and Information Technology (IT). In the long term, we will consolidate fleet composition and restructure Flight Operations, but these are long-term targets and we are not committed to any detailed plans. We will also work on integrating Maintenance, Cabin Service, and Flight Crew organizations but we have intentionally left Cabin Attendants (CA) and Flight Crew (FC) integration separate because they require adjusting work conditions and pay scales. The new airlines will continue to operate based on the Flight Crew (FC) groups of the former (JAL) and (JAS)."

The integration costs in Fiscal Year 2004 & 2005 will amount to Y 36 billion/$344.9 million, but the total integration effect will result in annual savings of Y 63 billion from 2005 and on.

The new Japan Airlines (JAL) Group has a staff of 54,885 and a fleet of 286 airplanes that will operate on 176 domestic, 200 international and 45 cargo routes.

767-346ER (33845, JA609J); & 777-246ER (32894, JA707J) deliveries.

May 2004: Fiscal Year 2003 Japan Airlines Corporation = Y 88.62 billion/-$789 million (+ Y 11.65 billion): due to a loss of 3 million passengers on international routes resulting from the (SARS) outbreak and the Iraq war: -20% international (RPK), & -2.7% in cargo revenue.

June 2004: A300B4-2C (151, JA8263) sold to Fly Air (FLM).

August 2004: Plans to integrate new domestic passenger services using "IC" card technology, including a ticket less check-in service developed by (JAL) for domestic airports in Japan. The (JAL) "IC" Check-in service will allow cardholders to board domestic flts without a ticket or boarding pass, they simply "touch and go" with their cards at the boarding gate. The service will begin at Tokyo Haneda this winter and later will be installed at other domestic airports.

October 2004: Code share with Hainan Airlines (HNA), Haikou - Osaka (KIX).

A300B2K-3C (176) sold to Fly Air (FLM).

November 2004: (JAS) is operating temporary Tokyo - Niigata flights after a series of earthquakes last month disrupted Joetsu Shinkansen express train service.

Last 6 months ending September 2004 = + Y 82.9 billion/+$784.3 million (- Y 57.59 billion): international +32.3% (RPK); +40% PAX; domestic -7.2% PAX.

December 2004: 5,200 employees.

(IATA) Code: JD - 234. (ICAO) Code: JLJ - (Callsign J-BIRD).

30/20 orders (2/08) 787's, including short/medium-range, 787-3, 300 PAX, and long-range 787-8, 250 passengers, to replace its fleet of 58 767's & A300's. The 7E7's will enter service 1 year before Tokyo Haneda's 4th runway comes into operation, significantly reducing (JAL)/(JAS)'s need to operate larger airplanes. With a +40% increase in takeoff and landing slots at Haneda, (JAL)/(JAS) will improve customer passenger convenience, enhance operational efficiency, through a better match of supply to demand and expand its network.

(JAL) Group 4th Quarter = + Y 3.7 billion/+$35.6 million (+ Y 3.7 billion). Last 9 months = + Y 79.2 billion (- Y 538 billion). Projects Fiscal Year 2004 = + Y 23 billion.

February 2005: Has moved most of its domestic operations from Nagoya Komaki to the new 24-hour Chubu International Airport, known popularly as "Centrair" after it opened February 17, 2005. The new $7.8 billion airport, half owned by private companies including the locally based car giant Toyota, is built on an island reclaimed from Ise Bay, and expects to draw 12 million passengers/year.

30/10 orders (2006-02) 737-700/-800/-900X.

March 2005: Japan Airlines (JAL) Group 2004 forecast = + Y 27 billion/+$260 million. Its 3-year restructuring plan includes -1,400 additional layoffs by 2007 on top of the -4,500 it had previously said would be eliminated by end of 2006. This will be achieved through a hiring freeze and natural attrition.

Toshiyuki Shinmachi, President will succeed Isao Kaneto, CEO in June 2005 at the Annual General Meeting (AGM), who will retain the position of Group Chairman. Katsuo Haneda, is President, Japan Airlines Domestic.

April 2005: 4,362 employees (including 818 Flight Crew (FC); 1,555 Cabin Attendants (CA); & 1,003 Maintenance Technicians (MT)).

May 2005: Japan Airlines Corp Fiscal Year 2004 = + Y 30 billion/+$284.2 million (- Y88 billion): +18% fuel costs; 14.7 million international passengers (+25.5%); 44.7 million domestic passengers (-3.7%). Projects 2005 = + Y 17 billion.

June 2005: Next month, scheduled, late-night domestic air cargo flights betweem Tokyo and Kumamoto in central Kyushu using the belly holds of A300-600R's that are used for passenger flights during the day.

July 2005: Next February will be the opening of Kobe Airport with new services to Tokyo Haneda, Sapporo, Sendai, Okinawa, Kumamoto, and Kagoshima.

Has plan of restructuring of its network and cost improvements in response to higher fuel prices. Key to the shift in strategy is a greater role for low-cost subsidiary JALways (JAI), which will take over more routes, eg in October, Tokyo - Manila, Tokyo - Brisbane, Tokyo - Denpasar (Bali), & Osaka - Denpasar.

Will retire +3 747's than originally planned. In fiscal year 2005, will retire 4 747's, 1 747F, 4 DC-10's, 3 A300's & 2 YS-11's. Will add 3 767-300ER's, 2 777-200ER's, 2 777-300ER's & 2 CRJ200's. The JAL Group will operate 281 airplanes by the end of the fiscal year. 3 orders 767-300ER's and 3 orders 767-300ERF's.

777-246ER (33395, JA710J) & 777-346ER (32433, JA734J) deliveries.

August 2005: (JAL) Airlines Corporation = 54,053 employees (+155%).

Japan Airlines Group (JAL)/(JAS) selected Sabre's AirMax Revenue Manager solution for managing revenues from international operations. Sabre said AirMax "is expected to generate additional revenue from a sophisticated and proven solution set of revenue management functions and business process services."

767-346ER (33849, JA613J & 777-246ER (33396, JA711J) deliveries.

September 2005: Teledyne Controls said Japan Airlines (JAS) selected its Enhanced Digital Flight Data Acquisition Unit and Aircraft Condition Monitoring System software development services for its new 737-800 fleet.

October 2005: (JAL) Group announced yesterday that Japan Airlines Domestic (JAS) will be merged into Japan Airlines International (JAL) effective Oct 1, 2006. (JAL) Sales, which handles group travel sales, will transfer its activities to JAL International (JAL) six months earlier, on April 1.

The existing corporate structure consisting of separate domestic and international airline organizations was formed in April 2004 to smooth the merger between Japan Airlines (JAL) and Japan Air System (JAS). (JAL) expects that combining the units will speed decision-making, streamline management and improve communications between head offices and service branches.

As a result of the consolidation, Japan Airlines International (JAL) and Japan Airlines Domestic (JAS) will integrate their personnel and wage systems, "achieving greater work efficiency due to the removal of intra-group trading, procedures and adjustments among the integrated companies."

Japan Airlines Corp (JAL), the holding company, will be retained; "However, the organization of the holding company will be slimmed down as much as possible."

(JAL) said the integration itself will not generate any extra income or affect costs beyond the objectives and reforms presented in the current medium-term corporate plan announced on March 10. About -100 jobs will be eliminated, resulting in savings of ¥1 billion ($8.8 million), while costs of about ¥500 million will be incurred due to Information Technology (IT) systems integration, taxes and legal registration fees.

The company's three-year restructuring plan unveiled in March includes -1,400 additional layoffs and other cost-cutting measures intended to shed ¥75 billion in costs by the end of Fiscal Year (FY) 2007, ultimately rising to ¥100 billion or more per year.

Boeing said Japan Airlines (JAL) has become the first licensed user of its Maintenance Performance Toolbox, a secure online service offering electronic assistance and integration for aircraft maintenance and troubleshooting. (JAL) partnered with Boeing in developing the product. The Toolbox features visual navigation methods and databases intended to facilitate prevention, repair and recordkeeping and is available on any device with an Internet connection.

(JAS) agreed to purchase 30 737-800 blended winglet shipsets with options for 10 additional shipsets. Deliveries will begin in November 2006. Aviation Partners Boeing (AVP) estimated (JAS) will save more than 80,000 gallons of fuel per airplane per year.

November 2005: Japan Airlines Group blamed stagnant traffic in key markets and soaring fuel prices for a -¥12.04 billion/-$102.3 million net loss for the first half ended Sept 30 compared to income of +¥83 billion last year.

(JAL) warned that it expects to show a full-year loss of -¥47 billion. It previously forecast a small profit of +¥17 million, but high fuel prices and flat traffic in key markets will push it into the red for the year to March 31.

Total operating revenues for the six-month period were up +3.4% to ¥1.11 trillion but operating costs jumped +10.9% to ¥1.1 trillion, resulting in half-year operating income of +¥15.7 billion.

The airline said that while transpacific, Korean and Taiwanese routes showed steady demand, interest in routes in Southeast Asia, Europe and Oceania was stagnant. Overall international passenger traffic rose just +0.3% RPK and the number of passengers carried was 7,230,244, virtually unchanged from the year-ago period. Domestic traffic also was stagnant, with passenger numbers down -1% to 22,286,276 and RPKs off -1% as well.

Fuel costs in the period averaged $69.60 per barrel versus $44.40 last year. (JAL)'s fuel bill was up a massive +32% to ¥181.3 billion. Prior-year results benefited from a ¥34.4 billion credit linked to airplane purchases, while this year there was an extraordinary loss of -¥15.6 billion due to a reassessment of the valuation of assets including buildings and land.

On the heels of yesterday's announcement, (JAL) Group unveiled a series of corporate reforms designed to create "an airline group with enhanced customer appeal and a stronger corporate base in time for 2009." It will spend approximately ¥60 billion to enhance safety over the next five years, including strengthening Information Technology (IT) systems, adding maintenance technicians and improving jet airplane Maintenance Repair & Overhaul (MRO) facilities.

From 2006, the airline will restructure international routes and reduce capacity, expanding routes served by mid-size and small airplanes, especially on Japan - China service. In 2009, it will expand its fleet in order to capitalize on the commencement of international service from Haneda Airport and slot increases at Narita. Additionally, it will invest ¥65 billion in service-related equipment. It will introduce 23 new airplanes through March 2009, comprising 19 737-800s and four 787s, and retire 30 747-200s and dash 300s.

On the labor front, (JAL) board members will take a -23% - -40% pay reduction while monthly salary cuts for employees of (JAL) International, Domestic, Corporation and Sales will average -10% from 2006 through March 2008. The company said it intends to hold negotiations with labor unions.

December 2005: Oneworld member Finnair (FIN) and soon-to-be-member Japan Airlines (JAL) agreed to code share on (JAL)'s domestic routes and Finnair (FIN)'s European routes starting this month. Finnair (FIN)'s code will be added to (JAL)'s routes between Osaka and Sapporo, from Fukuoka to Osaka and Tokyo and from Tokyo Haneda to Osaka. (JAL)'s code in turn will be added to Finnair (FIN)'s Helsinki - Amsterdam and Helsinki - Frankfurt routes. Both companies will explore possibilities to codeshare on Finnair (FIN)'s routes to Japan and (JAL)'s routes from Japan to other Asian destinations.

Japan Airlines (JAL)/(JAS) became the first carrier to implement Boeing's Airplane Health Management system, which monitors the condition of an airplane in flight and relays information in real time to prepared maintenance crews at the gate. (JAL)/(JAS) uses it on 747s and 777s.

All Nippon Airways (ANA) and Japan Airlines (JAL)/(JAS) will remove high-pressure turbine (HPT) blades from 88 (PW4000)s powering their respective 777 fleets. (JAL)/(JAS) will spend ¥4.3 billion/$36.8 million to replace (HPT)s in 46 engines while (ANA) will replace blades in 42 engines for ¥5.2 billion, Mainichi Daily News reported. Pratt & Whitney has been working with operators for some time to address the problem with the blades, which are subject to corrosion. Increased inspection and gradual replacement has been the preferred strategy, but two (ANA) 777s experienced inflight engine shutdowns (IFSD) last fall while a (JAL) airplane had an (IFSD) in August. All airplanes diverted and landed safely and the problems were traced to the faulty blades.

Japan Airlines (JAL)/(JAS) is the customer for five 777-300ERs and a 767-300F that previously were listed on the Boeing orders website as unidentified.

767-346ER (33851, JA614J), delivery.

January 2006: Full year 2005 = Passenger traffic 95.45 Billion RPK (11th highest in world); Freight traffic 4.83 Billion (FTK); 51.14 Million passengers.

Japan Airlines Domestic (JAS) will increase one-way domestic fares +3% - +11.3% from April 1 to Septtember 30 to help it cope "with the financial impact of sustained high fuel prices." At the same time, (JAS) will eliminate the domestic fuel surcharge of ¥200 - ¥300 established in January 2005. The airline said its Fiscal Year (FY) 2005 fuel bill will be ¥90 billion higher than in the previous year. It expects costs to increase ¥130 - ¥140 billion in (FY) 2006.

February 2006: Soaring fuel costs, "adverse publicity" over recent safety-related operational events and declining demand on services to China resulting from lingering feelings about anti-Japanese protests in April all factored into another rough quarter for Japan Airlines (JAL)/(JAS), which reported a -¥11 billion/-$92.5 million loss for the three-month period ended Dec 31, up from a loss of -¥3.7 billion in the previous year's third fiscal quarter. Revenues rose +21% to ¥556.9 billion but expenses climbed +33.9% to ¥573.5 billion, leading to a -¥16.6 billion operating loss compared to a -¥3.8 billion loss in the 2004 quarter.

In conjunction with the results, (JAL)/(JAS) released its "Route, Frequency and Fleet Plan" for the coming fiscal year, which it said is designed to build a more "profit focused" network intended to return its international services to the black.

Plans to produce an annual income improvement of ¥8 billion include increased frequencies from Tokyo to markets including Chicago and Taipei, other seasonal increases, decreases to London and Bangkok and suspension of the Tokyo - Las Vegas and Osaka - Los Angeles services. Its JALways (JAI) subsidiary will take over operations on several routes throughout Southeast Asia including flights from Tokyo to Jakarta, Vietnam and Sydney. A host of alterations to its domestic route structure were announced as well.

During Fiscal Year (FY) 2006 (JAL)/(JAS) will retire six 747s, three A300s and four YS-11s and add two 777-300ERs and one 767-300ER for international operations, three 737-800s for domestic service and three Dash 8s. Its fleet at the conclusion of (FY) 2006 will number 275 airplanes. Cargo flights will increase with introduction of two 747-400CFs.

For the nine-month period ended Dec 31, (JAL)/(JAS) slipped into the red with a net loss of -¥23 billion compared to a +¥79.2 billion profit in the year-ago period. Revenues rose +3.6% to ¥1.67 trillion and expenses climbed +9.3% to ¥1.67 trillion, resulting in an operating loss of -¥800 million compared to a profit of +¥83 billion last year. Fuel costs increased +30% to ¥284 billion. Consolidated passenger traffic declined -1.2% to 75.93 billion (RPK)s, capacity dropped -0.8% to 113.42 billion (ASK)s and load factor fell -0.3 point to 66.9% LF.

Domestic changes from Tokyo Haneda:
Suspension of Toyama route.
Increase of service to Kochi, Miyazaki and Tokushima.
Reduction of number and size of airplanes to Sapporo.
Larger airplane used to Okinawa.

Domestic changes from Osaka Itami & Kansai:
Added turboprop flights at Itami as a result of reduced jet flights.
Itami - Narita will increase in frequency after October.
Overall increase in flights from Kansai.

Domestic changes from Nagoya:
Large-sized airplanes to Okinawa and Sapporo (747 and 747-400)
Increase in frequency to Kagoshima and Sendai.

Japan Airlines (JAL)/(JAS) (CEO) Toshiyuki Shinmachi, who was among three top executives asked to resign by four (JAL)/(JAS) board members on Feb 10, has no intention of leaving and issued a statement saying he found the incident "regrettable," adding that it "undermines the public trust at a time when (JAL)/(JAS) Group must join hands and hearts" to improve perception of its safety standards and enact corporate reforms.

(JAL)/(JAS) confirmed that the four board members, buttressed by a petition "signed by several (JAL)/(JAS) managers of vice president level," called for the resignation of Shinmachi, Executive VP Katsuo Haneda and Senior Managing Director Hidekazu Nishizuka. Shinmachi said he felt responsible for the board members' conduct and offered an apology to (JAL)/(JAS) stakeholders. "Top management feels that it is our duty to finalize the next Mid-Term Corporate Plan, which is the reforming process, clarify the course of action to take, complete integration into one company in the true sense and build a new organizational structure," he said. "I ask everybody to fulfill their respective responsibilities and ignore any such petition asking for my resignation."

Japan has opened its 97th airport at Kobe, the site of a devastating earthquake 11 years ago. The $2.6 billion airport will be used by Japan's three air carriers - - Japan Airlines (JAS), All Nippon Airways (ANA), and Skymark Airlines (SKM) - - for domestic flights from its single 8,250-ft runway. Kobe city expects 3.19 million passengers in its first full year of operation, and it is hoped the airport will help rebuild an economy devastated by the January 1995 force 7.2 quake that killed more than 6,400 people. The airport has been dubbed "Marine Air" in Japan, as it is built on reclaimed land with a view of the ocean. It is the second major airport to be opened in the country in the past 12 months, with Chubu Centrair International Airport beginning operations near the city of Nagoya in February 2005. The Kobe airport opening is expected to increase pressure on nearby Kansai International Airport, which has suffered a fall in domestic flights in the past year, in addition to the Japan Railways, which is planning to add three bullet trains between Tokyo and Kobe from late March in a bid to stay competitive.

Meantime, a report by Japan's Bureau of Audit found that many recently-opened regional airports were struggling to meet passenger forecasts. These included Noto Airport, which opened in 2003 off Hokkaido Island and is currently handling 151,000 passengers, less than half the initial estimates, and Odate-Noshiro Airport, which opened the same year in northern Japan and is handling less than a quarter of initial estimates.

March 2006: March 2006: Embattled JAL Group (JAL)/(JAS) (CEO) Toshiyuki Shinmachi, who stood fast against an attempted coup by four board members last month, lost his battle to keep his position amid rising discontent and agreed yesterday to relinquish the (CEO) title and take over as group Chairman. Shinmachi will be replaced as (CEO) following the June shareholders meeting by Senior VP-Finance and Purchasing, Haruka Nishimatsu, a board member who joined the airline in 1972. Pending confirmation, Nishimatsu will be promoted to senior Managing Director on all three JAL boards (JAL)/(JAS), effective April 1.

Executive VP, Katsuo Haneda and Senior Managing Director, Hidekazu Nishizuka, whose resignations were demanded last month in the board's petition, also will be "retiring" from the boards of JAL Corporation, (JAL) International and JAL Domestic (JAS). A host of additional retirements and promotions occurred in preparation for the reunification of (JAL)/(JAS)'s International and Domestic companies on October 1. The number of JAL (JAL)/(JAS) board members, and executive officers fell from 41 to 36.

Burdened by the boardroom upheaval that cost (CEO) Toshiyuki Shinmachi his job this week, widening losses that reached -¥11 billion/-$94.9 million last quarter and several well-publicized safety-related incidents, Japan Airlines (JAL)/(JAS) released an extended five-year, medium-term business plan designed to "win back the trust and confidence" of stakeholders and customers, create a more unified and open corporate culture and return the airline to profitability in the fiscal year ending March 31, 2007. The plan runs through March 2011, the end of (JAL)/(JAS)'s 2010 fiscal year, to include the planned expansion of Tokyo Haneda, which will add a fourth runway, an international terminal and 30,000 - 40,000 operations per year in 2009 as the airport transitions to international service.

The plan will focus on implementing recommendations by the Safety Advisory Group, an external committee established last year, and enhancing passenger service at a cost of ¥125 billion; streamlining (JAL)/(JAS)'s network to focus on profitable services and routes popular with business travelers and introducing smaller, more fuel efficient airplanes, while increasing load factor and yield, and generating cost savings amounting to -¥119 billion per year by the end of Fiscal Year (FY) 2010. The carrier expects the "rebuilding" phase of its plan to conclude by the time the expanded Haneda is operational.

For the fiscal year ending March 31, 2007, (JAL)/(JAS) forecasts a profit of +¥3 billion on operating revenues of ¥2.3 trillion. It expects those figures to rise to +¥17 billion and ¥2.37 trillion respectively two years later. By the end of (FY) 2010, it expects net earnings of ¥55 billion on revenues of ¥2.44 trillion. Its interest-bearing debt, estimated at ¥1.98 trillion at the end of the current fiscal year, will fall to ¥1.38 trillion by plan's end.

The company's ¥125 billion investment will break down as follows: ¥8 billion for a new 777 dock at Tokyo Narita, a large-engine test center and a cargo weighing system; ¥25 billion for (RNAV) systems and spare engine reserves; ¥28 billion for a new maintenance Information Techynology (IT) system and a safety information database and distribution system; ¥1 billion for a safety promotion center, educational equipment and improved flight simulators; ¥25 billion for inflight passenger service enhancements, Oneworld membership measures and cargo business expansion; ¥16 billion for operational improvements including distribution, scheduling and e-commerce development, and ¥24 billion for airport facility and deicing equipment upgrades.

Boeing and Japan Airlines (JAL)/(JAS) signed an Integrated Material Management agreement giving the airframer responsibility for purchasing, inventory and logistics for (JAL)/(JAS)'s expendable airplane parts. Boeing and other suppliers own the parts, which are stored at a location convenient to the customer. (JAL)/(JAS) will pay for parts on an as-needed basis.

Fleet composition will change from the current 279 airplanes spread over nine types, to 296 airplanes of eight types by the end of the plan. Average airplane age will decrease from 11.6 years to 10.4 years. (JAL)/(JAS) hopes eventually to operate only 5 - 6 types.

May 2006: Japan Airlines Group (JAL)/(JAS) blamed sluggish traffic growth caused by "safety-related occurrences" and anti-Japanese sentiment in China for its inability to overcome rising fuel costs, resulting in a drastic reversal in financial fortunes and a loss of -¥47.2 billion/-$423.2 million in the fiscal year ended March 31 compared to earnings of +¥30 billion in Fiscal Year (FY) 2005. Group revenue grew +3.3% to ¥2.2 trillion, but operating expenses were up +7.3% to ¥2.23 trillion, dragging the company to a -¥26.8 billion operating loss compared to a +¥56.1 billion operating profit in the previous year. Passenger numbers were down -3.8% to 14.2 million while passenger traffic (RPK)s fell -2.2% to 67.4 billion and (ASK)s declined -2.3% to 97.2 billion.

(JAL)/(JAS) suspended services to some resort destinations and increased flights on popular business routes during the year. While traffic was steady to the USA, Korea and Taiwan, the carrier said demand to Europe and Southeast Asia dropped, and Chinese traffic was down -8%. On the domestic network, "individual passengers failed to grow, mainly due to safety-related occurrences." Domestic revenues fell -2.2% as capacity dipped -1.9%.

A +¥88.2 billion surge in fuel costs was a critical factor in (JAL)/(JAS)'s result. Staff costs grew +¥3.3 billion owing to changes in the retirement fund, while currency exchange losses hit -¥6 billion. Going forward, the airline is focused on further streamlining its network to focus on business routes, restructuring its fleet, and expanding its JALways (JAI) subsidiary, which operates 747s domestically and to Pacific destinations.

JAL Group (JAL)/(JAS) also is looking to its pending Oneworld membership to improve revenue streams. On the domestic front, the focus is on expanding Class J seating, introducing more 737-800 services to replace some 767s and A300s, and strengthening e-marketing initiatives. Both (JAL)/(JAS) and All Nippon Airways (ANA) have been phasing out domestic 747s in favor of 777-300s for some time.

Aerosim Technologies said Japan Airlines (JAS) signed an agreement for the supply of a Virtual Procedure Trainer for the A300-600ER.

767-346ER (33850, JA615J), delivery.

June 2006: Japan Airlines (JAL) at a meeting in Paris, received a formal invitation to join the Oneworld alliance, seven months after the world's largest unaligned carrier announced its intentions. The mainline will be integrated by early next year and (JAL)/(JAS) Group members JALways (JAI), Japan Asia Airways (JAA), JAL Express (JEX), J-Air and Japan Transocean Air (SWL) will join as affiliate members. American Airlines (AAL) is (JAL)'s principal sponsor, assisted by Cathay Pacific Airways (CAT). (JAL) and its affiliates will add 47 destinations to Oneworld (ONW)'s network.

"Japan Airlines (JAL) and the Oneworld (ONW) Alliance have been able to conclude all necessary membership agreements extremely speedily, which signals excellent working relationships going forward," (JAL) (CEO), designate Haruka Nishimatsu said.

The carrier already has interline e-ticketing agreements in place with (AAL) and British Airways (BAB) and will link up with (CAT) within months. Remaining members, plus new recruits Malev Hungarian Airlines (HGA) and Royal Jordanian (RJA), will be online by the time (JAL) joins next year. Oneworld said it is the only alliance with interline e-ticketing among all its members.

Following Star Alliance's lead, Oneworld will consolidate its operations at Tokyo Narita's Terminal 2. Most members of Star will operate out of T1. Qantas (QAN) and (JAL) already are housed in T2, and (AAL), Cathay (CAT) and Finnair (FIN) will relocate from T1 in 2007 and build their own lounges. (BAB) will remain in T1.

Narita spent $10 million to upgrade T2 last year. A $170 million investment starting this year will include a refurbishment of the check-in and security screening area, more user-friendly flight information displays, increased shopping areas and two new gates, bringing T2's total to 30.

All Nippon Airways (ANA) and Japan Airlines (JAL)/(JAS) face a limited 24-hour strike on June 21 by some pilot (FC) unions "over dissatisfaction with the management stance on career progression," among other issues. International flights will not be affected, but up to 25% of domestic flights for both airlines will be impacted.

Haruka Nishimatsu, 58, was confirmed as JAL Group (JAL)/(JAS)'s new President and (CEO), with former group (CEO), Toshiyuki Shinmachi confirmed as group Chairman. Shinmachi was pressured to relinquish the (CEO) title four months ago. Nishimatsu, 58, formerly was Senior VP Finance & Purchasing and has spent most of his working life at (JAL). "I adored airplanes. I had watched planes fly over Hamamatsu between Tokyo and Osaka since I was a small boy and was fascinated by them," he said. Well liked at (JAL), he will be hoping his enthusiasm helps turn the airline around after a series of highly publicized safety incidents and heavy financial losses. Meanwhile, the group board has increased its membership to 18 as it integrates the board of (JAL) Corporation with those of its two main operating companies, Japan Airlines International (JAL) and Japan Airlines Domestic (JAS), which are due to merge on October 1.

July 2006: Japan Airlines Domestic (JAS) is the major domestic carrier of the Japan Airlines Group operating companies, providing an extensive domestic network and international services plus charter flights throughout China.

4,257 employees (including 798 Flight Crew (FC); 1,581 Cabin Attendants (CA); & 1,878 Maintenance Technicians (MT)).

(IATA) Code: JL. (ICAO) Code: (JLJ).

(http://www.jal.co.jp). (org.jas.brz@jal.com).

Parent organization/shareholders: Japan Airlines Corporation (JAL)/(JAS) (100%).

Owns: Japan Air Commuter; Air Do (HIA) (51%); Hokaido Air System (HIA) (51%); & Amakusa Airlines (2%).

Alliances: Finnair (FIN); Hainan Airlines (HNA); Mexican (CMA); & Skymark Airlines (SKM).

Main Base: Tokyo International (HND).

Hub: Tokyo Narita International (NRT).

Domestic Scheduled Destinations: Akita; Amami O Shima; Aomori; Asahikawa; Fukuoka; Fukushima; Hakodate; Hanamaki; Hiroshima; Izumo; Kagoshima; Kita Kyushu; Kochi; Komatsu; Kumamoto; Kushiro; Matsumoto; Matsuyama; Memametsu; Misawa; Miyazaki; Nagasaki; Nagoya; Niigata; Obihiro; Oita; Okayama; Osaka; Sapporo; Sendai; Takamatsu; Tokunoshima; Tokushima; Tokyo; Toyama; Ube; & Yamagata.

Japan Airlines (JAL)/(JAS) said it plans to sell 700 million new shares in an effort to raise as much as $1.94 billion for airplane purchases and debt reduction. It said the sale will take place next month, and it is leaving open the option of selling another 50 million shares. "We're going to use the funds for expansion," CFO, Yuichiro Kito said at a Tokyo news conference. "Rather than waiting for a turnaround in business, we decided to take action." (JAL)/(JAS) will determine an offer price for the share sale by July 21.

August 2006: Japan Airlines Group (JAL)/(JAS) appears to have made significant progress in its restructuring with a fiscal first-quarter loss of -¥26.7 billion/-$233.2 million set against sharply increased fuel costs, an improvement over the year-ago period's -¥38.3 billion loss. Over the past 12 years, (JAL) typically has posted a loss in the quarter ended June 30. All numbers in the recently completed quarter were positive. Operating revenues were up +3.7% to ¥522.2 billion and international traffic revenue rose +5.2%, reflecting a focus on high-profit and high-growth-rate routes. Cost-structure reforms limited the negative impact of a +11.6% increase in fuel costs and an unfavorable US dollar-yen exchange rate. Operating expenses rose only +3.5% to ¥554.1 billion.

The company's international restructuring resulted in better numbers. Higher demand for first and business class travel and fuel surcharges combined to raise yields +11.2%. That was offset by a -5.8% decline in passenger numbers to 3.2 million brought about by a -11.6% reduction in (ASK)s due to network and fleet restructuring. International load factor climbed +4.6 points to 69.9% LF. On the domestic front, traffic fell -1.6% to 10.37 billion (ASK)s, while yield lifted on fare increases. Domestic revenue was up +0.4% to ¥150.9 billion.

Cargo results were mixed. Demand out of China and Hong Kong was weak, but demand from Japan was buoyant. Overall traffic was down -3.4%, but yield rose +10.3% due to an increase in the percentage of high-yield cargo and fuel surcharges.

(JAL) management has not changed its forecast for the full fiscal year. It is expecting a modest net profit of +¥3 billion built on an increase in revenues to ¥2.3 trillion. The group also is looking to its Oneworld membership to improve revenue streams, while a major restructure of its fleet will help rein in costs. It is building its fleet around smaller types including the 737-800, 767-300ER, 777 and 787. This year, it will complete the retirement of the A300 and YS-11. Thirty 747 Classics will be retired by Fiscal Year (FY) 2009. At the same time, it is converting eight 747-400s to 747-400BCFs. The 747s are being replaced by 777s.

November 2006: Japan Airlines (JAL)/(JAS) emerged from a year in the red with a +¥28.2 billion/+$239.2 million profit in its second fiscal quarter ended September 30, a figure based on the carrier's half-year results released yesterday.

For the six-month period, (JAL)/(JAS) posted a +¥1.5 billion profit that represented a reversal from a -¥12 billion net loss in the semester ended September 30, 2005. Six-month revenues rose +3.4% to ¥1.15 trillion.

The company credited a restructured route network and capacity cuts for a +2.9% gain in international passenger revenue, and new promotional campaigns and the introduction of more Class J business seats (C) for a +1.6% lift in domestic passenger revenue. Costs climbed +4.1% to ¥1.41 trillion. The airline partially offset a +15.4% rise in its fuel bill to ¥209.2 billion with lowered consumption, surcharges and a "-10% wage reduction." Six-month operating income declined -48.4% to +¥8.1 billion.

(JAL)/(JAS) flew 49.1 billion (RPK)s during the semester, a decrease of -4% from the year-ago period. Capacity fell -6.9% to 71.44 billion (ASK)s and load factor rose +2 points to 68.7% LF. (JAS) domestic traffic was up +0.2% to 16.75 billion (RPK)s against a +0.6% lift in (ASK)s to 26.15 billion, dropping load factor -0.3 point to 64% LF. (JAL) International (RPK)s declined -6.1% to 32.35 billion, (ASK)s fell -10.8% to 45.29 billion, and load factor grew +3.5 points to 71.4% LF.

The company maintained its full-year profit guidance of +¥3 billion but now forecasts revenue of ¥2.28 trillion, down from the ¥2.3 trillion projected in March, and costs of ¥2.69 trillion. As a result, its full-year operating profit is expected to come in at +¥13 billion rather than +¥17 billion.

1st 737-846 (35330, JA301J) delivery - see photo.

January 2007: Japan Airlines (JAL) is mulling a plan to lay off -3,000 employees, -6% of its workforce, over the next three years to help cut losses, according to press reports. The cuts are due to be unveiled in (JAL)'s mid-year business plan due out next month. It posted a loss of -¥47 billion/-$394.8 million for the fiscal year to March 2006, as fuel prices hit the bottom line and All Nippon Airways (ANA) grabbed market share. According to the "Mainichi Daily," (JAL) also is considering a restructuring of the group's related businesses with a possible of sale of some units.

Japan Airlines Group (JAL)/(JAS) is responding to strong passenger demand by increasing frequencies on seven international routes and putting its 2007 inflight product through a major revamp. From March 25, it will up its New York (JFK) frequencies from 10 to 13 per week and from June 1, Paris Charles de Gaulle (CDG) will be served twice-daily, up from the current 10 weekly flights. (JAL) also will add a frequency on routes from Tokyo Narita (NRT) to New Delhi, and Moscow Sheremetyevo plus from Osaka Kansai to Hanoi, Dalian, Hangzhou and Qinqdao. The latter services will be operated by newly delivered 737-800s fitted with individual InFlight Entertainment (IFE) and Alternating Current (AC) power to most seats. On the chopping block are frequencies between (NRT) and Hong Kong, plus summer flights to Zurich. Meanwhile, (JAL) plans to increase charters by +13% in an attempt to cater to retiring "baby boomers," with packages planned for Europe and destinations around the Pacific Rim.

Its key to growing yield will be the rollout of a major upgrade of both the domestic and international cabin products. First class (F)will be added to domestic services in Fiscal Year 2007 (FY07) and all classes will be upgraded on international routes from (FY08). In 2004, (JAL) introduced Class "J" on domestic flights, replacing an earlier business class (c) service dubbed "Superseat," and Class "J" has enjoyed an 85% LF (load factor). The airline will offer three classes on some domestic services. The first airplanes to be configured will be 15 777-200s. A major change to the international offering will be the introduction of a "Premium" Economy class (Y), with 40 seats installed in all 777s used on routes to Europe and the USA. The seats will be in a 2-4-2 configuration with 38-inches pitch. Further upgrades will be announced later.

Related somewhat, American Airlines (AAL) transferred its Narita operation to Terminal 2 from Terminal 1, and opened a new 13,300-sq.-ft lounge as part of Oneworld's effort to collocate its members prior to (JAL)'s entry into the alliance later this year. By the end of 2007, five Oneworld members will operate out of T2.

Japan Airlines Group (JAL)/(JAS) took a hatchet to its 165-route domestic network in its biggest overhaul since 9/11. Changes announced include introduction of one new route (a daily Kobe - Ishigaki service starting in July), a frequency increase on four, reductions on five, and suspension of 10 regional domestic services. Key drivers of the change are the availability of more slots at Tokyo airports in Fiscal Year (FY) 2009, a focus on yield and competitive pressures from (ANA). (JAL) plans to phase out all eight 145-seat MD-87s used on routes from Haneda (HND) that are legacies of its merger with Japan Air System (JAS) in favor of eight 737-800s. These airplanes will have 20 business class (C) seats in a five-abreast configuration. (JAS) also will introduce a domestic first class (F)on some flights in (FY) 2007, commencing in December on the Haneda - Osaka Itami route. Its fleet will be boosted by the addition of one 777-300ER, one 777-200, three 767-300ERs, three 767-300Fs and two Dash 8 Q400s as it phases out 10 747-200s. By the end of (FY) 2007, the fleet will total 273 airplanes, one fewer than at the end of (FY) 2006.

737-846 (35331, JA302J), delivery.

February 2007: JAL Group (JAL)/(JAS)'s comprehensive restructuring is starting to take effect with the company reducing its loss in its third fiscal quarter ended December 31 to -¥13.0 billion/-$107.1 million, narrowed from the -¥20.6 billion deficit in the year-ago quarter.

In conjunction with that announcement, (JAL)/(JAS) released a Medium Term Revival Plan covering the next four years, that will include an increased commitment to safety and elimination of -4,300 jobs.

Among the four core focuses of the plan, is a commitment to improving safety, after a spate of safety-related operational lapses in 2005. (JAL)/(JAS) will reduce its workforce to 48,800 by the end of the 2009 fiscal year, and is targeting a +10% productivity increase. Executives will take pay cuts as well, with President & CEO, Haruka Nishimatsu taking a -60% hit effective this month.

The plan's third platform is continued fleet renewal, built around the 737, 777 and 787s, with a decrease in or withdrawal of the 747, MD-80 and A300 fleets. In addition, (JAL)/(JAS) will focus on high-growth, high-profit routes out of the expanding Tokyo airports, while boosting frequencies at its JALways (JAI), JAL Express (JEX), and J-AIR subsidiaries.

Third-quarter operating revenues rose +4.9% to ¥584.1 billion, while costs grew +4.3% to ¥598.1 billion, narrowing operating loss to -¥14 billion from -¥16.6 billion in the December 2005 quarter. Nine-month net loss of -¥9.3 billion was improved from a -¥23 billion deficit in the year-ago period, although operating loss widened to -¥5.8 billion from -¥800 million. Three-month traffic figures and unit performance were not announced. Nine-month (RPK)s passenger traffic fell -6.9% to 47.48 billion against a -10.4% drop in (ASK)s capacity to 66.88 billion, which lifted load factor +2.7 points to 71% LF.

For the full year ending March 31, (JAL)/(JAS) is maintaining a forecast of net earnings of +¥3 billion, a reversal from the -¥47.2 billion loss in Fiscal Year (FY) 2005. Revenues and expenses each are expected to fall -13% from previously forecast levels, with operating profit staying at +¥13 billion. It is forecasting net earnings of +¥7 billion for the year ending March 31, 2008, and +¥6 billion in the following year.

Japan Airlines (JAL)/(JAS) on March 25 will redeem ¥79.7 billion of convertible bonds due to mature in 2011, the company said in a stock exchange filing cited by "Bloomberg News," which said investors had until February 23 to convert the ¥100 billion of bonds into stock, but that shares in (JAL)/(JAS) closed -32% lower than the bonds' conversion price. (JAL)/(JAS) said it is seeking a ¥60 billion credit line to help repay the bonds, according to "Bloomberg."

Starting April 1st, Nagoya - Kitakyusyu, & Okinawa - Kagoshima, both discontinued; Nagota - Kochi resuced to 2/day, using CRJ-200s; & Osaka (KIX) - Fukuoka increased to 4/day. Starting June 1st, Kobe - Sapporo (CTS) increased to 3/day. Starting July 1st, (KIX) - Dalian increased to 7/week; - Qingdao, - Hangzhou; both increased to 3/week; all using 737-800s. Starting October 1st, Fukuoka - Aomori; - Hanamaki; (CTS) - Matsumoto; - Misawa; all 4 discontinued; Fukuoka - Nagoya, reduced to 4/day; - Dendai, reduced to 2/day; & (cts) - Nagoya reduced to 6/day.

JAL Group (JAL)/(JAS) announced its intention to introduce the Embraer E170 on its domestic network, starting next year.
The company said it "will conclude a purchase agreement" with the Brazilian manufacturer for 10 firm airplanes plus five options this spring. They will be powered by GE (CF34-8)s and be operated by regional subsidiary J-AIR, which currently relies mainly on the CRJ-200. (JAL)/(JAS) said the airplanes will allow it to match demand more efficiently on domestic routes and take advantage of an increase in slots at Tokyo Haneda from 2009.

April 2007: (CAE) said that it sold two 7000 Series 787 full-flight simulators to Japan Airlines (JAL)/(JAS) valued at C$36 million/$31.2 million. The first will be delivered to (JAL)/(JAS)'s Tokyo Haneda training center in 2008.

Japan Airlines (JAL)/(JAS) completed Oneworld's spring expansion, joining Malev Hungarian Airlines (HGA) and Royal Jordanian (RJA) as members of the alliance. (JAL)/(JSA) subsidiaries JALways (JAI), Japan Asia Airways (JAA), JAL Express (JEX), J-AIR and Japan Transocean Air (SWL) are new Oneworld affiliate members. (JAL)/(JAS) was the largest airline in the world outside one of the three major alliances, Oneworld said. It adds nearly 50 airports to the grouping's network and one new country, Guam. LAN Argentina (LNR) and LAN Ecuador (LNE) also are new affiliate members, while Aer Lingus (ARL)'s withdrawal now is official. Dragonair (DRG) will join as an affiliate member later this year.

Japan Airlines (JAL)/(JAS) ordered five additional 787-8s, bringing its total to 35 and pushing Boeing (TBC)'s total Dreamliner sales to more than >500 if new orders from unidentified customers are included. (JAL)/(JAS) placed an order for 30 787s in December 2004, nine months after Boeing launched the program. The manufacturer said that it has sold 514 Dreamliners to 43 customers, meaning 23 new orders from four customers including (JAL)/(JAS) have been received since the end of last week. "Surpassing the 500 order mark this early in the program - - more than a year before the first airplane is delivered - - shows that Boeing (TBC) made the right choice in our point-to-point business strategy, and that the 787 team made the right choices in designing the airplane," 787 Program VP & General Manager, Mike Bair said. Customers for the remaining new orders were unidentified.

Boeing (TBC) said that (JAL)/(JAS) will install Class 3, Electronic Flight Bags (EFB) on two new 777s to be delivered this year: A 777-200 scheduled for delivery in May, and a 777-300ER to be delivered later in the year. The (EFB)s are the first ordered by (JAL)/(JAS), which operates 38 777s and has eight more on order.

737-846 (35332, JA303J) and 767-346er (35813, JA6126J), deliveries.

May 2007: Japan Airlines (JAL)/(JAS) revised down its earnings forecast for its 2006 fiscal year ended March 31, to a net loss of -¥16.2 billion/-$135.5 million, significantly changed from a February forecast of a net profit of +¥3 billion for the 12 months. The company said in a statement that the alteration was "primarily due to deferred tax asset adjustments to its balance sheet and an extraordinary loss resulting from a special early retirement program (JAL)/(JAS) launched in March 2007. (JAL)/(JAS) has reevaluated its deferred tax management strategy and decided to remove ¥44.7 billion of deferred tax assets from the Fiscal Year (FY) 2006 balance sheet."

However, it boosted its revenue forecast for the fiscal year by +1.5% compared to the February forecast, to ¥2.3 trillion and its operating profit by +76.2% to ¥22.9 billion. It is scheduled to release official results for the fiscal year ended March 31 on May 9. It reported a -¥47.2 billion net loss for the fiscal year ended March 31, 2006.

A significantly improved operating result helped Japan Airlines Corp (JAL)/(JAS) narrow its net loss for the fiscal year ended March 31 to -¥16.2 billion/-$135.1 million from -¥47.2 billion in the prior year, although the bottom line was hurt by the removal of a ¥54.4 billion deferred tax asset from the balance sheet, and an extraordinary loss of -¥6 billion from a special early retirement program launched in March. (JAL)/(JAS) credited network restructuring, cost-cutting and rising yields from international premium traffic for its reversal of operating fortune as it reported a +¥22.9 billion profit compared to a -¥26.8 billion deficit in Fiscal Year (FY) 2005. Operating revenue climbed +4.6% to ¥2.3 trillion, driven by a +5% lift in international passenger revenue to ¥724.8 billion and recovering domestic demand, with sales up +1.6% year-over-year to ¥675.6 billion. International passenger yield jumped +13.1%. Continued cost-cutting, including a -10% wage reduction, held the increase in operating expense to just +2.3% to ¥2.28 trillion even as the fuel bill climbed +11.6%.

(JAL)/(JAS) found that passenger demand was particularly strong on short- and medium-haul routes, such as Korea and Southeast Asia services, as well as China, where it boosted frequencies and enjoyed its largest traffic and capacity increases. International network restructuring has been a key platform for recovery, and featured an emphasis on high-profit routes, suspension of low-profit routes, and airplane downsizing. On the domestic front, the carrier launched various promotional campaigns while introducing its Class J domestic business class (C) on some airplanes.

Total traffic fell -7.2% to 62.6 billion (RPK)s against a -9.5% decline in capacity to 87.99 billion (ASK)s, lifting load factor +1.7 points to 71.1% LF.

In the fourth fiscal quarter, (JAL)/(JAS) lost -¥6.8 billion, narrowed from a -¥24.1 billion deficit in the year-ago quarter, on a +7.1% rise in revenue to ¥567.7 billion. Operating result swung to a +¥28.7 billion profit from a -¥25.9 billion loss. It is targeting a full-year profit for the 12 months ending March 31, 2008, forecasting -¥7 billion in net income on ¥2.2 trillion in revenue and an operating profit of +¥35 billion.

Thales (THL)'s TopSeries In-Flight Entertainment (IFE) system was selected by Japan Airlines (JAL)/(JAS) for installation on the carrier's 787s, the first of which is slated to enter service next year.

737-846 (35333, JA304J), delivery.

June 2007: 737-846 (35334, JA305J), delivery.

August 2007: Japan Airlines (JAL)/(JAS) parent JAL Group's strategy of focusing on high-yield business traffic appears to be paying dividends, evidenced by a narrowed fiscal first-quarter net loss of -¥4.2 billion/-$36.8 million for the three months ended June 30, a strong improvement over a -¥26.6 billion net loss in the year-ago quarter. The result was achieved on revenue of ¥520.6 billion, a -0.3% decline attributed to the removal of trading company JALUX from the group's figures. Airline (JAL)/(JAS) operations produced revenue growth of +3% to ¥422 billion despite cutbacks in routes. A major highlight was a -4.5% fall in expenses to ¥529.2 billion, brought about by route restructuring, fleet downsizing, personnel cuts, fuel consumption reduction measures and contingency measures such as a decrease in (JAL)/(JAS) staff's basic wage. The airline cut -1,600 staff for the year ended March 31, and plans to trim another -700 workers this year, with a goal of -4,300 total job cuts by March 2009.

Quarterly traffic was down -6.9% to 21.48 billion (RPK)s on a -4.2% decrease in capacity to 33.26 billion (ASK)s. International load factor was 67.8% LF and domestic 59.2% LF, while overall load factor was 64.6% LF.

Cargo revenue increased +0.6% to ¥44.4 billion as (RTK)s lowered -3.8% to 3.08 billion and (ATK)s declined -2.5% to 5.18 billion. While cargo demand from Japan to China grew tenfold, demand out of Europe and Southeast Asia slackened due to depreciation of the yen, (JAL)/(JAS) said. It maintained its May 2007 guidance that the group remains on track to record a net profit of +¥7 billion for the full year ending March 31, 2008.

September 2007: Japan Airlines (JAS) will introduce first class (F) for the first time on domestic flights from December 1. The new offering will be rolled out on seven daily flights between Tokyo Haneda (HND) and Osaka Itami, and eventually will be available on all flights. From April 1, the first class (F) product will be available on flights from (HND) to Fukuoka and Sapporo. The move follows the rollout of a dedicated business class (J Class) on domestic routes in June 2004. JAL (JAS) offers 8 million J Class seats per year, with an 85% LF load factor.

October 2007: Japan Airlines (JAL)/(JAS) said it will offer early retirement plans to 900 cabin staff (CA), who will have completed 15 years of service and will be at least 54 years old if managerial or 50 if nonmanagerial on March 31. (JAL)/(JAS) said it is working to cut yearly employment costs by -¥50 billion/-$425 million from Fiscal Year (FY) 2006, by increasing productivity 10%, a hiring freeze and early retirement incentives. It said 630 ground staff employees holding middle management positions have accepted an early retirement package, offered in August, and will leave the carrier November 30. A total of 250 senior management employees out of 450 eligible, retired June 30, under a similar scheme. (JAL)/(jas) said that Maintenance (MT), Engineering (MT), and Flight Operations (FC) control staff, have been excluded "to secure smooth business operations and pass on skills and techniques."

737-846 (35335, JA306J), delivery.

November 2007: The JAL Group (JAL)/(JAS) reported a better-than-fivefold increase in net income for the first half of its fiscal year ended September 30 to +¥7.3 billion/+$63.7 million compared to +¥1.5 billion a year earlier, crediting "cost reforms" such as airplane downsizing, reduced spending on personnel, and the elimination of
money-losing routes for the improvement. First-half revenue dipped -0.6% to ¥1.14 trillion, while costs fell -4.9% to ¥1.09 trillion, producing operating income of +¥56.6 billion, a nearly sevenfold
boost over +¥8.1 billion last year. The (JAL) Group (JAL)/(JAS) noted that air transport segment personnel expenses lowered by -¥7.1 billion. The airline is targeting -4,300 total job cuts by March 2009. Traffic dropped -5% to 46.66 billion (RPK)s on a -4.4% decrease in capacity to 68.3 billion (ASK)s, producing a load factor of 68.3% LF, down -0.4 point. "Tourism demand was weak on Europe routes and Hawaii routes, due to a weakening of the yen, and also on Taiwan routes, where competition intensified," the company said. "Demand out of Korea was particularly strong, and business demand was strong on USA routes, Southeast Asian routes, and China
routes." First-half international cargo revenue fell -1% year-over-year to ¥91.4 billion.

(JAL)/(JAS) projects flat fiscal-year (FY) 2007 net income of +¥7 billion on a +3% boost in revenue to ¥2.24 trillion.

December 2007: Japan Airlines Domestic (JAS) has become the first carrier to commit to serving the new Mt Fuji Shizuoka Airport, when it opens in the spring of 2009. (JAS) says that from the new airport, it will operate daily services to Fukuoka in Kyushu, and thrice daily, services to Sapporo in Hokkaido. The airport is being built in the Shizuoka prefecture in central Japan between the cities of Shizuoka and Hamamatsu.

737-846 (35336, JA307J), delivery.

January 2008: 2007 statistics (JAL)/(JAS): 86.6 billion (RPK)s passenger traffic -4.5%; -4.3% capacity (ASK)s; -.2 load factor for 69% LF.

Japan Airlines (JAS) will offer first class (F) on two of its 18 daily, Tokyo Haneda - Fukuoka flights from April 1. (JAS) said it will be the first time that first class (F) will be available on a domestic flight.

Japan Airlines (JAL)(JAS) said 320 flight attendants (CA) applied for its early retirement plan out of 900 who were eligible. Early retirement also has been offered to certain senior management and ground staff. (JAL)/(JAS) said 1,200 (CA) have taken advantage of the offers across the company in the past year. It intends to reduce personnel costs by -¥50 billion/-$468.3 million each fiscal year through Fiscal Year (FY) 2009 to 2010 with a variety of initiatives.

737-846 (35337, JA308J), delivery.

February 2008: (JAL) Group (JAL)/(JAS) reported net income of +¥13.1 billion/+$122.9 million for its fiscal third quarter ended December 31, reversed from a net loss of -¥10.8 billion in the prior year period, citing "shifting of resources to high-profit routes" and a sharp reduction in personnel costs. Quarterly revenue decreased -4.4% to ¥558.2 billion, while expenses lowered -11% to ¥532.3 billion, producing operating income of +¥25.9 billion, reversed from a -¥14 billion operating loss in the year-ago quarter. Nine-month profit was +¥20.4 billion versus a net loss of -¥9.3 billion in the 2006 period.
"Over the nine month-period, capacity supply on international and domestic passenger routes measured in (ASK)s, decreased respectively by -4.9% and -3.1%, as a result of network restructuring, by shifting to high-profit routes and fleet downsizing," (JAL)/(JAS) said. Total traffic for the nine months declined -3.7% to 45.7 billion (RPK)s on a -4.9% drop in capacity to 63.6 billion (ASK)s, producing a load factor of 71.9% LF, up +0.9 point. The company noted that its cost reduction efforts generated +¥14.9 billion in savings through the fiscal year's first nine months. Looking ahead, (JAL)/(JAS) forecasts a full fiscal year profit of +¥7 billion, which would reverse a -¥16.2 loss in the prior fiscal year.

Chairman, Toshiyuki Shinmachi announced that he will retire on March 31. He has held the post since June 2006, when he was elevated from CEO. No successor has been appointed.

Japan Airlines Group (JAL)/(JAS) released its latest corporate plan covering the April 1, 2008 to March 31, 2009, period and said the expansion of Tokyo's downtown Haneda Airport, downsizing of the fleet, and the introduction of more premium products are pivotal. It plans to operate flights between Haneda and Beijing Nanyuan during this summer's Olympics, as well as to increase the number of international "charter" flights from the airport. (JAL) currently operates flights from Haneda to downtown airports in Seoul (Gimpo) and Shanghai (Hongqiao). Haneda will be expanded significantly in 2010, when a fourth runway is opened. The carrier is speeding implementation of its premium-customer-oriented strategy by introducing new seats in (JAL) First Class (F) and (JAL) Executive Class and by introducing its (JAL) Shell Flat Seat, and (JAL) Premium Economy (Y) Service onto more routes. It also is replacing 747-400s with 777-300ERs on some New York (JFK) and San Francisco services, while 737-800s are replacing 767-300s on some regional services to China and Korea. On domestic routes, it will expand its first class (F) rollout and introduce the EMB-170 from February 2009. In Fiscal Year (FY) 2008, it plans to retire 10 747 Classics (seven passenger and three freighter), two 767-300s, and six MD-81s, and introduce three 777-300ERs, five 767-300ERs, nine 737-800s, and two EMB-170s.

737-846 (35338, JA309J), BOC Aviation (SIL) leased, 737-846 (35339, JA310J), and 767-346ER (35815, JA618J), deliveries.

March 2008: Japan Airlines (JAL) parent JAL Group (JAL)/(JAS) in its Fiscal Year (FY) 2008 to 2010 "Medium Term Plan" raised its profitability target for its 2010 to 2011 fiscal year to +¥96 billion/+$932 million from +¥88 billion in last year's "Medium Term Plan." The decision to increase the target is owing to early successes in its ongoing restructuring program, which also contributed to its raising its operating profit forecast for the current year ending March 31 to +¥48 billion from +¥35 billion. Over the period of the plan, (JAL)/(JAS) will retire 46 airplanes, including 747-200s and MD-81s, while adding 65 777s, 737-800s and 787s. As of March 31, 2011, the fleet will number 291 airplanes, up from 272 today.

(JAL)/(JAS) also expects to expand the use on international and domestic routes of subsidiaries JALways (JAI), JAL Express (JEX) and J-AIR, which have overhead costs approximately -10% lower than the mainline. JAL Express (JAI) currently serves domestic routes, but in Fiscal Year (FY) 2009, will start operating 737-800s internationally, primarily to China. J-AIR, which operates regional jets domestically, will expand operations with EMB-170s in (FY) 2008. The group's strategy is focused on high-growth, high-profit markets. A key platform is the accelerated rollout of new first (F) and business class (C) seats on international services, along with premium economy. As previously announced, it plans to reduce staff numbers from 53,100 at the end of (FY) 2006 to 48,800 by the end of (FY) 2008.

April 2008: 737-846 (35340, JA311J), delivery.

May 2008: JAL Group (JAL)/(JAS) last week issued a revised full-year forecast for the year ended March 31, 2008, saying that "trends in recent performance" led it to raise expected net earnings to +¥16 billion/+$153.9 million from the +¥7 billion projected in its most recent forecast last November. It reported a -¥16.2 billion loss in the year ended March 31, 2007.

Fiscal year operating income is expected be +¥90 billion, compared to the originally forecast +¥48 billion and last year's +¥22.9 billion. Operating revenue is expected to be slightly lower than originally forecast, ¥2.23 trillion versus ¥2.24 trillion. Both figures represent approximately a -3% drop from Fiscal Year (FY) 2006. The company will release final results May 9. "As a result of the effectiveness of 'premium strategies' aimed at attracting business and top-tier travelers through product and service enhancement and development, international passenger demand has been robust," (JAL)/(JAS) said. "Even though domestic passenger demand is slightly lower than expected, the JAL Group (JAL)/(JAS)'s revised forecast for operating revenue is almost the same as its previous forecast announced in November last year."

The key, the company said, has been "the effectiveness of group-wide cost reform implemented during (FY) 2007." It expects full-year costs to be ¥2.14 trillion, down -2.3% from the November forecast, and -6.1% from the prior year. (JAL)/(JAS) said it will take a ¥7.07 billion temporary depreciation charge related to a change in the expected lifetime of certain spare parts and that it has set aside ¥6.19 billion to deal with the ongoing European Commission (EC) investigation into alleged antitrust violations on international cargo shipments. Last month it agreed to pay a $110 million fine after reaching a plea agreement with the USA Dept of Justice.

The Japan Airlines Group (JAL)/(JAS) announced a significant earnings turnaround to a net profit of +¥16.9 billion/+$162.1 million for the fiscal year ended March 31 from a loss of -¥16.2 billion the prior year on the back of premium strategies on its international operation and route restructuring on its domestic network. The profit was achieved on a -3% drop in sales to ¥2.23 trillion as (JAL)/(JAS) disposed of a number of consolidated subsidiaries. In terms of air transportation, JAL Group (JAL)/(JAS)'s core business, revenue increased +1.4% to ¥1.82 trillion.

Leading the turnaround was international passenger demand bolstered by "premium strategies" launched over the past two years. International revenue increased +4% to ¥754.3 billion, while domestic demand was stagnant due to a reduction in supply after the airline restructured its network. Domestic revenue crept up just +0.3% to ¥677.4 billion. It was able to slash operating costs -6.1% to ¥2.14 trillion, and its operating income of +¥90 billion, up from +¥22.9 billion in Fiscal Year (FY) 2006, was the highest since the 2002 integration with Japan Air System (JAS).

Net profit would have been much higher, but for a series of extraordinary losses resulting from special early retirement programs, funds set aside for antitrust investigations by USA and European Union (EU) authorities, and temporary depreciation costs. (FY) 2007 passenger numbers eased +3.8% to 55.3 million, while (RPK)s traffic declined at the same rate to 92.17 billion. Capacity fell -4% to 134 billion (ASK)s, lifting load factor +0.2 point to 68.7% LF.

Key to the group's dramatic renaissance was its focus on high-profit, high-growth routes, and enhancing the role of its low-overhead international subsidiary JALways (JAI). (JAL) increased frequencies to China, India, Russia, and Vietnam. It also raised its profile through a greater commitment to Oneworld (ONW), revamping lounges and check-in areas at Tokyo Narita's Terminal 2 and introducing (JAL) Premium Economy and first class (F) on some domestic flights.

It continues to rationalize its fleet through a shift to twin-engine airplanes and retirement of older 747s and MD-81s, and said that soaring fuel prices will result in accelerated disposal of five 747-200Fs that will be replaced by 767-300Fs on routes to China, Vietnam, and Indonesia.

Going forward, (JAL)/(JAS) is forecasting a -23% drop in profit to +¥13 billion for (FY) 2009, due to escalating fuel prices and increased competition, particularly from the popular Shinkansen bullet train.

Japan's Ministry of Land, Infrastructure and Transport announced the following policies that will take effect when Tokyo Haneda's fourth runway opens in 2010, the Centre for Asia Pacific Aviation reported: Night curfew will be reduced to 10 pm from 11 pm, to "allow more convenient schedules for USA and European flights," international slots will be restricted to 30,000 until October 2010, and eventually will increase to 60,000, with new slots going to "expansion of Asian city routes where business need is strongest," and domestic slots will double to 20,000 annually.

737-846 (35341, JA312J), delivery.

The Japan Airlines Group (JAL)/(JAS) posted a net loss for its fiscal first quarter ended June 30 of -¥3.4 billion/-$31.3 million, narrowed from a -¥4.3 billion deficit in the prior-year period, and unveiled the biggest review of its network since 2002 to mitigate the rising cost of fuel. The earnings result, while an improvement year-over-year, marked (JAL)/(JAS)'s fifth consecutive first-quarter loss. It said that from October 1, it will make major network changes, lifting capacity on high-growth, profitable flights such as those between Japan and Seoul, Shanghai and Hanoi. But it will suspend services on at least three underperforming international routes including Osaka - London Heathrow. It also will downsize airplanes on a number of international routes and operate fewer frequencies on 12 domestic routes. It will cut five domestic routes altogether. (JAL)/(JAS) said it will make alterations to its cargo network, including suspending routes and lowering frequencies where it believes revenue is waning. The airline already has been undergoing something of a restructuring and the narrowed first-quarter loss was partly attributable to slashed jobs, reduced bonuses and lower retirement benefits.

Quarterly revenue decreased -5.8% to ¥490 billion, mainly due to two companies being removed from the list of the JAL Group (JAL)/(JAS) subsidiaries. Its core air transportation segment posted a +1.4% increase in revenue to ¥428.1 billion and the segment's operating income was +¥14.2 billion, reversed from a -¥10.9 billion operating loss in the year-ago period. The group is holding to its forecast of a +¥13 billion profit for its full fiscal year.

International passenger traffic was down -5.7% to 13.22 billion (RPK)s on a -3.5% decrease in capacity to 19.95 billion (ASK)s, while domestic traffic lowered -0.3% to 7.43 billion (RPK)s on a -2.6% fall in capacity to 12.26 billion (ASK)s.

(ANA) and Japan Airlines (JAL)/(JAS) are looking to cut underperforming domestic and international routes. (ANA) told media that it may suspend 10 routes, while "Nikkei Business Daily" suggested that (JAL)/(JAS) may suspend 21 routes. Both airlines are expected to make formal announcements soon.

JAL Group (JAL)/(JAS) filed an application with the Japanese Ministry of Land Infrastructure, Transport & Tourism requesting that international normal interline fare rates be raised by +10% on flights to the Americas and by +5% on flights to other Asian destinations and to the Middle East and Africa.

737-846 (35343, JA314J), delivery.

September 2008: The Japanese economy shrank -3% in the second quarter.

Japan Airlines Domestic (JAS) warned that some of its pilots (FC) and flight attendants (CA) are planning a one-day strike on domestic services on October 1. It projected that 24% of domestic flights will be cancelled with no impact on international services.

October 2008: Japan Airlines (JAS) took delivery of its first EMB-170. (JAS) signed a deal with Embraer in June 2007 for 10 firm orders plus five options. The 76Y-seat, single-class airplane will be operated by regional subsidiary J-Air.

December 2008: 737-846 (35345, JA316J), delivery.

February 2009: Japan Airlines (JAL)/(JAS) parent, the JAL Group reported a net loss of -¥38.5 billion/-$428 million for its fiscal third quarter ended December 31, reversed from a +¥13.1 billion net profit in the year-ago period, citing a "downward slide" in demand and "volatile" fuel prices. "The global economic slowdown and the accelerating appreciation of the yen led to a substantial year-on-year decrease in demand on Europe and USA routes throughout" the first nine months of its fiscal year, (JAL)/(JAS) said in a statement. It noted that it is in the process of "extensively restructuring its network," downsizing its fleet and reducing capacity.

Third-quarter revenue declined -13% to ¥485.7 billion, while expenses lowered -1.4% to ¥524.7 billion, leading to an operating loss of -¥39 billion, reversed from an operating profit of +¥25.9 billion in the year-ago period. The company did not break out quarterly traffic figures but stated that traffic decreased -12.5% for the nine months ended December 31 to 39.97 billion (RPK)s on a -4.5% dip in capacity to 60.75 billion (ASK)s, producing a load factor of 65.8% LF, down -6.1 points.

Looking ahead, the carrier projects a -¥34 billion net loss for the full fiscal year ending March 31, a downgrade from a November forecast of a +¥13 billion profit. In revising the forecast, (JAL)/(JAS) pointed to "severe conditions facing the air transport segment due to the decline in demand resulting from the current global economic slowdown."

The JAL Group (JAL)/(JAS) will integrate four subsidiary airplane maintenance companies on October 1, forming (JAL) Engineering Company in a move intended to enhance productivity "and further strengthen the quality of airplane maintenance services through the consolidation of expertise and technological know-how," according to the airline. The four companies are (JAL) Narita Aircraft Maintenance Company, (JAL) Tokyo Aircraft Maintenance Company, (JAL) Engine Technologies Company, and (JAL) Aviation Technologies Company.

March 2009: 2 737-846s (35346, JA317J; 35347, JA318J), and 1 767-346ER (37548, JA621J), deliveries.

April 2009: Japan Airlines (JAL)/(JAS) applied for a ¥200 billion/$2.03 billion loan from the Development Bank of Japan, a spokesperson confirmed to "Bloomberg News," which said (JAL)/(JAS) has ¥35 billion in bonds maturing over the next four months. (JAL)/(JAS) forecast a -¥34 billion net loss for the fiscal year ended March 31.

Japan Airlines (JAL)/(JAS) now expects to report a -¥63 billion/-$651.3 million loss in its fiscal year ended March 31, nearly double the -¥34 billion it forecast in February, owing to a "relentless" decline in global demand. "Premium travel out from Japan slid against the backdrop of continuous cost-cutting measures by companies in this economic situation," the company said, adding that increasing outbound leisure demand was offset by a strong yen that "eroded both business and leisure demand from overseas." Operating revenue now is expected to be ¥1.95 trillion, down -1.4% from the previously forecast total, and expenses are expected to be ¥2 trillion, rather than ¥2.01 trillion. Projected operating loss of -¥51 billion compares to the -¥37 billion forecast in early February.

(JAL)/(JAS) said it brought forward savings initiatives that originally were scheduled to be implemented at the start of the current fiscal year, resulting in a -¥13 billion drop in expenses for the period ended March 31. The final result also will be affected by (JAL)/(JAS)'s decision to halt the sale of unidentified assets due to their depreciation.

(JAS) transported 41.2 million passengers on domestic routes during the year, down -1.8%, and flew 31.3 billion (RPK)s traffic, a -1.4% decline. Capacity fell -1.8% to 49.17 billion (ASK)s and load factor was 63.7% LF. (JAL) International passenger numbers dropped -12.4% to 11.7 million on a -13.6% fall in (RPK)s to 52.19 billion. Capacity slid -5.4% to 79.58 billion (ASK)s and load factor was 65.6% LF.

Japan's Ministry of Land, Infrastructure, Transport & Tourism increased the number of landing slots at Tokyo Haneda as a temporary measure "to support Japan's airline industry during the current difficult economic environment," Japan Airlines (JAL)/(JAS) said. (JAS) will use its allotment to operate an eighth daily flight to Hiroshima from May 8 to May 31 and a 20th daily flight to Fukuoka from June 1 to June 30. Additional flights in the July to October period have not been determined. (JAL) also said it will reduce its daily, Tokyo Narita - Delhi service to four-times-weekly from June 1 to October 24.

737-846 (35348, JA319J), delivery.

May 2009: 2 767-346ERs (37549, JA622J; 36131, JA623J), deliveries.

June 2009: The Japanese government is preparing to extend a loan of approximately ¥100 billion/$1.04 billion to Japan Airlines (JAL)/(JAS), Finance Minister, Kaoru Yosano said. Speaking to reporters, Yosano said he received a request from Transport Minister, Kazuyoshi Kaneko for the loan through the Development Bank of Japan (DBJ). "We hope to cooperate through (DBJ) loans" but the aid only will be granted "on the premise that [JAL] must do its best to improve management," he said. According to the Nikkei, the government is considering guaranteeing some 80% of the loan and three private sector banks are participating.

Citing the "slow recovery in air transport demand," Japan Airlines (JAL) said it would "strive to improve profitability by adjusting capacity" and announced a reduction in its international schedule effective July 1. (JAL)/(JAS) reported a -¥63.1 billion/-$640.9 million net loss in the fiscal year ended March 31 and said it expects a similar result this term. Cuts in service implemented in March to Shanghai Pudong (PVG), Beijing (PEK), Taipei and Hong Kong (HKG), originally set to expire at the end of this month, will be reimposed. Tokyo Narita (NRT) - (PVG) will operate 21-times-weekly instead of 28 from August 1 to October 24, (NRT) - Taipei will operate 21-times-weekly instead of 28 from July 1 to October 24 and (NRT) - (PEK) will operate 14-times-weekly instead of 19 August 1 - October 24. Tokyo Haneda - (HKG) will operate thrice-weekly rather than daily, September 1 to 17 and October 12 to 24.

New cuts will occur on flights from (NRT) to Incheon (to 21-times-weekly from 28 July 1 to October 24) and New Delhi (to thrice-weekly from four-times-weekly July 1 to October 24) and from Osaka Kansai to (PVG) and Incheon (both to 14-times-weekly from 21 August 1 to October 24).

(JAL) said unions representing (JAL) International pilots (FC), flight attendants (CA) and ground staff (MT) have threatened to strike. The (JAL) Pilots Union (660 members) "indicated plans" for a 72-hour strike, the (JAL) Labor Union (90) and (JAL) Japan Labor Union (660) flagged a 6-hour strike and the (JAL) Flight Crew Union (1,150) threatened a 24-hour walkout. (JAL)/(JAS) said only a pilot (FC) strike extending into a third day would affect domestic flight operations while its international schedule would operate normally. "The unions are still in negotiations with (JAL)/(JAS) management," the airline said. It was unclear weather the strike warnings were related to the aforementioned schedule cuts.

July 2009: Japan Airlines (JAL)/(JAS) reported a steep -¥99 billion/-$1.04 billion net loss for its fiscal first quarter ended June 30, dramatically widened from a -¥3.4 billion loss in the year-ago period, and announced "drastic adjustments" to its international flight network. (JAL)/(JAS) said that operating conditions in the quarter were "starkly harsher" than the prior-year quarter, pointing to "significantly down" first (F) and business class (C) traffic and the swine flu scare. "The reduction in fuel surcharge and decline in the number of premium travelers led to a -33.7% decrease in yield . . . further contributing to the -46.1% drop in revenue from international passengers," (JAL)/(JAS) stated.

It said that in the second half of its fiscal year flights between Nagoya and Paris Charles de Gaulle and Seoul Incheon will be discontinued and frequencies will be reduced on eight international routes. For example, Tokyo Narita (NRT) - Guangzhou weekly flights will be lowered from 14 to 7, and Osaka - Shanghai Pudong weekly flights will be reduced from 21 to 14 from October 25.

In addition, it will initiate "a major downsizing of airplanes" that will affect 15 flights on 14 international routes "where jumbo 747-400s will be switched to medium-sized 777s and 767s, and medium-sized 767s will be switched to even smaller 737s." For example, flights between (NRT) and Chicago O'Hare, Los Angeles, New Delhi, Singapore and Bangkok will be operated with 777s instead of 747-400s from October 25.

(JAL)/(JAS) said leisure passenger demand "shows signs of recovery as a fear of a pandemic recedes" but it warned that "business (C) travel is projected to remain slow." It said it "will persevere in the drastic adjustments to our network, downsizing our airplanes and implementing 'nothing-off-limits' cost-cutting measures to improve profitability." It maintained its Fiscal Year (FY) 2009 to 2010 full-year forecast of a -¥63 billion net loss on ¥1.7 trillion in revenue.

Fiscal first-quarter revenue fell -31.7% to ¥334.8 billion, while expenses lowered -13.4% to ¥421 billion, producing an operating loss of -¥86.1 billion, reversed from a +¥3.9 billion operating profit in the year-ago period. Traffic decreased -20.6% to 16.41 billion (RPK)s on a -12.3% cut in capacity to 28.26 billion (ASK)s, producing a load factor of 58.1% LF, down -6 points.

August 2009: Japan Airlines (JAL)/(JAS), coming off a more-than->$1 billion loss in its fiscal first quarter ended June 30, announced a "new corporate organization structure" aimed at streamlining internal processes and improving customer service. The revamped structure eliminates or consolidates "numerous intermediary functions within the organization in order to speed up decision-making processes that will strengthen the Group's overall efficiency, as well as to minimize the backend and overhead costs, which is a measure in line with (JAL)/(JAS)'s cost-reduction plans," the company said. The number of functional groups within the company will be reduced by -25%, as divisions are reorganized.

Its 100%-owned subsidiaries that provide airport-related services will be merged. JAL Sky Services, JALSky Tokyo and JALWave will form a new company called JAL Sky. The group previously announced that it would integrate its four subsidiary airplane maintenance companies on October 1, forming (JAL) Engineering. Also being combined are (JAL)-owned travel-related subsidiaries JALPAK, JAL Sales, JAL Sales Western Japan, JAL Sales Kyushu and JAL Sales Hokkaido.

(JAL)/(JAS) will establish a new Customer Experience Division with the purpose of centralizing "the planning functions involving the hardware, software and human-relation aspects of customer satisfaction." Executive VP & Assistant to the President, Corporate Planning, Tetsuya Takenaka has been put in charge of the new division.

(JAL) recently announced "drastic adjustments" to its international flight network.

2nd "Eco Jet' a 777-346ER delivery with green colors, starts Tokyo-Narita to Singapore. It will be assigned to key international destinations such as London, Paris, Frankfurt and Seoul. The first "Eco Jet" (a 777-246) continues operating primarily on domestic routes for (JAS).

September 2009: (JAL)/(JAS) said it plans to cut -14% of its workforce, or nearly -7,000 jobs, over the next three years, part of an ongoing restructuring that it indicated will include a tie-up with a foreign investor it hopes to identify next month. Speaking to reporters in Tokyo, President Haruka Nishimatsu revealed the job reduction plan and said that "the deadline is mid-October" for reaching an accord with a potential investor. He confirmed that the carrier is in talks with both American Airlines (AAL) and Delta Air Lines (DAL), and "Reuters" reported that Air France (AFA)/(KLM) also is talking with (JAL)/(JAS) about a possible investment. Neither (JAL)/(JAS) nor (AFA)/(KLM) confirmed the report. Nishimatsu said (JAL)/(JAS) likely would choose a single investor.

(JAL)/(JAS) is undergoing a major restructuring, which Nishimatsu detailed to a panel of experts convened by the Japanese transport ministry. It lost -¥99 billion/-$1.08 billion in its fiscal first quarter ended June 30 and announced "drastic adjustments" to its international flight network. Transport officials who attended the meeting with Nishimatsu told reporters that he outlined plans to reduce international flying and lower personnel costs. To that end, Nishimatsu told reporters that -6,800 of JAL's 48,000 workers will be cut by March 31, 2012. (JAL)/(JAS) last month announced a "new corporate organization structure" aimed at streamlining internal processes and improving customer service. It is forecasting a -¥63 billion net loss for its full fiscal year ending March 31, 2010.

(JAL)/(JAS) President, Haruka Nishimatsu is scheduled to meet with new Japanese Transport Minister, Seiji Maehara for the first time to discuss the airline's restructuring plan, "Nikkei" reported. There is speculation in Japan that (JAL)/(JAS)'s restructuring may be revised in the wake of the Democratic Party of Japan (DPJ)'s recent election triumph. (DPJ)'s Maehara has said he wants to "take a thorough look" at (JAL)/(JAS)'s plan, particularly since it continues to seek financial support from the Development Bank of Japan.

(JAL)/(JAS) President, Haruka Nishimatsu asked Seiji Maehara, Japan's new Transport Minister, for a government bailout, conceding that even a cash infusion from a foreign investor likely won't be enough to keep the troubled carrier afloat. Nishimatsu declined to say how much capital (JAL)/(JAS) is seeking from the government when talking to reporters following a meeting with Maehara. (JAL)/(JAS), which lost -¥99 billion/-$1.09 billion in its fiscal first quarter ended June 30, received government-backed loans from the Development Bank of Japan totaling around ¥100 billion in June and is in talks with (AAL) and (DAL) about one of them potentially taking a stake.

"The Financial Times," citing sources familiar with the situation, said (JAL)/(JAS) needs another ¥100 billion to maintain operations through early 2010 and ultimately hopes to raise more than >¥225 billion in new capital and loans. It previously announced a restructuring plan cutting -14% of its workforce, or nearly -6,800 jobs, over the next three years, while eliminating -50 routes, with a heavy emphasis on international reductions.

But following his meeting with the (JAL)/(JAS) President, Maehara told reporters that he's "not convinced" the company's restructuring plan will work. "I'm skeptical about the feasibility of (JAL)/(JAS)'s rehabilitation plan, so at this stage I have yet to say whether the government will inject public funds in (JAL)/(JAS)," he said. He added that he will consult with Prime Minister Yukio Hatoyama and plans to reach a decision "as soon as possible."

He rejected the notion that the government would take over (JAL)/(JAS) or force it to break up into smaller parts. "We are not considering anything other than for (JAL)/(JAS) to rebuild on its own," he said. Nishimatsu noted that (JAL)/(JAS) may need to revise its restructuring plan, possibly making deeper cuts, to secure government help.

Japan's Transport Minister said on Japanese TV that he will not force Japan Airlines (JAL)/(JAS), Asia's largest carrier by revenue, into bankruptcy, according to the "Associated Press (AP)." "We will not crush and liquidate [the airline]," Land, Infrastructure & Transport Minister, Seiji Maehara said on a TV Asahi talk show. "It's just impossible," the (AP) reported him as saying. The government set up a team of corporate directors to create a restructuring plan for (JAL)/(JAS), whose own draft reconstruction plan Maehara called "insufficient." The team is expected to make recommendations to the Transport Minister by early November. (JAL)/(JAS), which lost -¥99 billion/-$1.09 billion in its fiscal first quarter ended June 30, received government-backed loans from the Development Bank of Japan totaling around ¥100 billion in June, and is in talks with (AAL) and (DAL) about a potential stake sale. It revealed that it needs ¥450 billion through March 2011 for debt repayment.

737-846 (35351, JA322J) and 2 777-346ERs (36128, JA741J; 36129, JA742J), deliveries.

October 2009: Japanese Transport Minister, Seiji Maehara moved to calm nerves over the fate of Japan Airlines (JAL)/(JAS), saying at a news conference that he believes (JAL)/(JAS) can revive itself on its own but that "the government is ready to step in" and offer its support for the loss-making carrier. He told reporters he wanted to quell "excessive anxiety" about the airline, which is restructuring under government supervision after receiving a state-backed loan. "I believe (JAL)/(JAS) still has more than enough reserve power, but in case the worst happens, the government will support," Maehara said.

(JAL)/(JAS) likely won't reach an accord with a potential foreign investor until after it and the Japanese government settle on a firm restructuring plan for the carrier, according to multiple media reports. (JAL)/(JAS) confirmed last month that it was in talks with both American Airlines (AAL) and Delta Air Lines (DAL) regarding one of those carriers potentially taking a stake and said it planned to reach agreement on a tie-up by mid-October. But the country's new Democratic Party of Japan-led government, which took office last month, has expressed misgivings about (JAL)/(JAS)'s restructuring plan, which had been largely endorsed by the previous Liberal Democratic Party government. Further complicating the issue is (JAL)/(JAS)'s recent request for a government bailout.

Japanese Transport Minister Seiji Maehara has said he's "not convinced" the company's restructuring plan, which calls for cutting about -6,800 jobs and significantly reducing international flying, will work. While a stake sale reportedly won't be agreed to by mid-October as originally hoped, (DAL) and (AAL) both are believed to remain interested in acquiring part of (JAL)/(JAS).

Later, (JAL)/(JAS) was not commenting on reports in the Japanese media that it would seek ¥250 billion/$2.78 billion in debt forgiveness from its creditors and increase its planned job cuts to -9,000. The country's new Democratic Party of Japan-led government, which took office last month, has expressed misgivings about (JAL)/(JAS)'s restructuring plan, which calls for cutting -14% of its workforce, or nearly -6,800 jobs, over the next three years, while eliminating -50 routes, with a heavy emphasis on international reductions.

According to the "Kyodo" news agency, (JAL)/(JAS) has developed a revised plan that calls for significant debt forgiveness and slashes an additional -2,200 jobs. The report also stated that Nishimatsu would resign, which the airline denied.

(JAL)/(JAS) lost -¥99 billion in its fiscal first quarter ended June 30 and received government-backed loans from the Development Bank of Japan totaling around ¥100 billion in June. "Kyodo" reported that the carrier's largest creditors are DBJ with ¥230 billion in total loans, Mizuho Corporate Bank with ¥57 billion in loans, Bank of Tokyo-Mitsubishi UFJ at ¥53 billion, and Sumitomo Mitsui Banking Corporation with ¥37 billion.

Japan's Finance Minister is planning to meet with the country's Transport Minister to discuss a potential government bailout of Japan Airlines (JAL)/(JAS), which saw its weakened financial status deteriorate further over the weekend when its largest creditors balked at providing ¥300 billion/$3.3 billion in debt relief and equity swaps. (JAL)/(JAS) and a government task force overseeing its restructuring, proposed the relief plan but were rebuffed by the banks and asked to present a different plan, according to Japanese media reports. (JAL)/(JAS)'s biggest creditors reportedly are the Development Bank of Japan with ¥230 billion in total loans, the Mizuho Corporate Bank with ¥57 billion, the Bank of Tokyo-Mitsubishi UFJ at ¥53 billion, and the Sumitomo Mitsui Banking Corporation with ¥37 billion.

(JAL)/(JAS)'s initial restructuring plan, which called for -6,800 job cuts and slashing about 50 international routes, was deemed insufficient by Japan's new Democratic Party of Japan-led government. But Transport Minister, Seiji Maehara repeatedly has assured that "the government will back up" the airline if it is in imminent danger of collapse. The "Kyodo" news agency reported that Finance Minister, Hirohisa Fujii will meet with Maehara to discuss (JAL)/(jas), with options under consideration ranging from presenting the creditors with a new plan to a government bailout. (JAL)/(JAS) may be forced to sell its (JAL) Hotels subsidiary, according to the report, which added that (JAL)/(JAS)'s operating loss for its fiscal year ending March 31, 2010, is expected to exceed -¥200 billion.

Gerson Lehrman analyst, Daniel Lintz wrote in an analysis that "an injection of public funds remains the only viable option" for (JAL)/(JAS), estimating that "a figure approaching ¥1 trillion would seem . . . realistic, given the company's steep operating losses over the past two years and its stark earnings forecast." He added, "Without a doubt, (JAL)/(JAS) is too big to fail. (JAL)/(JAS) provides exclusive service on more than a handful of domestic routes and supports a broader food chain encompassing more than >100 affiliates and partners worldwide." He argued that the transport ministry should act because it "is complicit in creating the privatized carrier's bloated labor and pension cost structure and preserving its unprofitable domestic route schedules and fare structure."

The Japanese government and Japan Airlines (JAL)/(JAS) reportedly will unveil a new turnaround plan for the troubled carrier later this week that will include slashing -13,000 jobs and giving a new government-backed agency control over (JAL)/(JAS)'s restructuring process. "Kyodo News" reported that the new plan will nearly double the -6,800 job cuts that were called for in (JAL)/(JAS)'s original restructuring proposal. The reductions would be carried out in phases and concluded by March 2015, according to the report.

"Nikkei" reported that Enterprise Turnaround Initiative Corporation (ETIC) of Japan, a newly created quasi-government entity that is charged with buying debt from strapped companies and providing them with specialists to help oversee restructuring programs, will be put in charge of (JAL)/(JAS)'s turnaround. The report stated that (ETIC) could provide loan guarantees to enable skittish banks to lend (JAL)/(JAS) money, or could even lend funds directly to the airline. It reportedly needs a ¥200 billion/$2.17 billion loan to enable it to stay afloat through the end of its fiscal year that concludes March 31.

Meanwhile, foreign investors continued to show interest in taking stakes in (JAL)/(JAS), which last month revealed that it had held talks with both American Airlines (AAL) and Delta Air Lines (DAL) regarding one of those carriers investing in it. "Bloomberg News" reported that (DAL) has contracted Fleishman Hillard to help it lobby the Japanese government on the issue.

Later, (JAL)/(JAS) said it is seeking guidance on a turnaround plan from Enterprise Turnaround Initiative Corporation (ETIC) of Japan, a move that represents a formal first step toward a likely government-backed restructuring. (ETIC) is a newly created quasi-government entity designed to help rescue struggling companies. (JAL)/(JAS) said in a statement that it initiated a "preliminary consultation" with (ETIC) "to decide whether it would support the restructuring of our group." It added that "under" (ETIC) guidance, it would "render our maximum efforts in preparing a restructuring plan at the earliest opportunity that is satisfactory to all and strenuously strive to revitalize our business." (ETIC), which is charged with buying debt from strapped Japanese companies and providing them with specialists to help oversee restructuring, is designed specifically to target companies that "have revitalization potential but are carrying excessive debt."

Turning to (ETIC) was recommended by a task force set up by Transport Minister, Seiji Maehara to advise both (JAL)/(JAS) and the government on the best course of action. Task force head, Shinjiro Takagi told reporters that "reviving (JAL)/(JAS) will require a substantial amount of money, including public money." According to Japanese media reports, (ETIC) can provide loan guarantees to enable skittish banks to lend (JAL)/(JAS) money and also orchestrate direct financial support from the government. It additionally would oversee (JAL)/(JAS)'s restructuring plan, determining the right number of job cuts and route reductions. (JAL)/(JAS) initially proposed cutting -6,800 jobs but reportedly will be forced to slash at least -13,000 positions.

Maehara told reporters that (JAL)/(JAS) "is not your ordinary company" and the government is committed to keeping the carrier afloat. "If (JAL)/(JAS) were to stop flying, there would be serious repercussions for Japan's economy," he said. But he added that significant cost-cutting will be demanded by the government in exchange for public support. Maehara's Democratic Party of Japan last month replaced the long-entrenched Liberal Democratic Party after a decisive election victory. He complained that the previous government mistakenly provided bailout money to (JAL)/(JAS) without forcing the carrier to reform its cost structure. For example, it received around ¥100 billion/$1.1 billion in government-backed loans in June without being required to make significant changes. "Under the previous administration, there was no real due diligence, no real turnaround strategy," he said. In addition to mandating a tough restructuring plan, he said he also is pressing for legislation that would ease (JAL)/(JAS)'s heavy pension burden.

737-846 (35352, JA324J), delivery.

November 2009: Troubled Japan Airlines (JAL)/(JAS) reported a net loss of -¥32.1 billion/-$357 million for its fiscal second quarter ended September 30, reversed from a +¥40.1 billion profit in the year-ago period, and announced it has applied for "certified alternative dispute resolution," an out-of-court mediation process that enables strapped Japanese companies to negotiate debt settlements with creditors. The quarterly loss brought (JAL)/(JAS)'s fiscal first-half deficit to -¥131.2 billion, reversed from a +¥36.6 billion profit in the year-ago period and its worst first-half performance since the 2002 (JAL)/(JAS) merger. CFO, Yoshimasa Kanayama conceded that the result, driven by the global economic downturn, was "extremely bad."

While Japanese government officials had indicated that elements of a restructuring plan could be unveiled prior to the results release, (JAL)/(JAS) said that "agreement regarding the proposed business revitalization plan has not yet been reached between the parties concerned." Its turnaround is expected to be overseen by the Enterprise Turnaround Initiative Corporation (ETIC) of Japan, a newly created quasi-government entity designed to help rescue struggling companies. But it may take (ETIC) some time to finalize a restructuring plan, necessitating the application for third-party mediation that could result in immediate debt relief while the turnaround strategy is formulated. In addition, the Development Bank of Japan may extend a bridge loan and the Japanese government is pushing for special legislation that would ease (JAL)/(JAS)'s pension burden. Kanayama said the company will need around ¥125 billion in loans to enable it to get through the second half of its fiscal year ending March 31.

Meanwhile, President, Haruka Nishimatsu said (JAL)/(JAS) would like to decide on an international tie-up by year end. American Airlines (AAL) and Delta Air Lines (DAL) have been jockeying to make an investment in (JAL)/(JAS), with (JAL)/(JAS)'s continued participation in the Oneworld (ONW) alliance or a switch to the SkyTeam (STM) alliance at stake. Nishimatsu told reporters it would "make more sense" to remain a part of the Oneworld (ONW) alliance, according to "Bloomberg News."

Fiscal second-quarter revenue fell -26.4% to ¥429 billion, while expenses lowered -21.2% to ¥438.7 billion, producing an operating loss of -¥9.6 billion, reversed from an operating profit of +¥26.4 billion last year. First-half traffic decreased -10.9% to 39.01 billion (RPK)s on an -8.5% cut in capacity to 60.42 billion (ASK)s, producing a load factor of 64.6% LF, down -1.7 points. Passenger yield plunged -35.5% year-over-year.

Japan Airlines International (JAL) announced closure of the following international routes: Osaka Kansai (KIX) - Hangzhou, Tokyo Narita (NRT) - Hangzhou, (NRT) - Qingdao (both passenger and freighter service), (NRT) - Xiamen (all on Dec. 7), (KIX) - Busan, (KIX) - Hanoi (both January 12), (KIX) - Singapore - Kuala Lumpur (January 17) and (NRT) - Vancouver (YVR) - Mexico City (January 18). It will close its offices in Hangzhou, Qingdao, Xiamen and Mexico City. It will cut one of four daily, (NRT) - Taipei and one of two daily, (NRT) - London Heathrow frequencies from December 7 while increasing (NRT) - (YVR) service to daily from five-times-weekly effective January 18. On the domestic front, (JAS) will cease flights from Nagoya Chubu to Kumamoto (February 1), Hanamaki and Kushiro (both May 6) and from Kobe to Sapporo, Okinawa Naha (OKA) and Ishigaki (all on June 1). Tokyo Haneda - Kobe service will be discontinued on April 1 and Kitakyushu - (OKA) flights will end May 6.

(JAL)/(JAS) is expected to report a heavy loss for its fiscal first half ended September 30, increasing pressure on (JAL)/(JAS) and the Japanese government to develop a restructuring plan to help assure investors and customers that the troubled company won't collapse.
"We will not create a situation in which airplanes do not fly," Transport Minister, Seiji Maehara insisted to reporters, adding that short-term government financing and other rescue measures could be unveiled in advance of the earnings release. (JAL)/(JAS)'s turnaround is expected to be overseen by the Enterprise Turnaround Initiative Corporation of Japan, a newly created quasi-government entity designed to help rescue struggling companies.

According to Japanese media reports, a key issue is the carrier's pension funding deficit, estimated to be more than >¥300 billion/$3.3 billion. Maehara has said he is pressing for legislation that would ease (JAL)/(JAS)'s pension burden and creditors reportedly are willing to provide relief if the government can help solve the pension problem. Creditors last month balked at supplying around ¥300 billion in debt relief and equity swaps. Pension relief legislation could be introduced as soon as next week, according to multiple reports.

Meanwhile, (JAL)/(JAS) announced that President, Haruka Nishimatsu and about 70 top executives will forego pay in December. "Agence France Presse" reported that (JAL)/(JAS) also is considering asking 17,000 nonexecutive employees to forego winter bonuses. Once a restructuring plan is developed, (JAL)/(JAS) likely will resume negotiations with Delta Air Lines (DAL) and American Airlines (AAL) about one of those carriers potentially taking a stake.

(JAL)/(JAS) President, Haruka Nishimatsu told former employees that the company's pension benefits must be cut significantly to enable it to become sustainable long-term. Its pension funding deficit, estimated to be more than ¥300 billion/$3.37 billion, is making both its creditors and the Japanese government wary about providing relief.
Nishimatsu addressed a large audience of retired (JAL)/(JAS) workers, personally apologizing for the weak state of the airline and proposing that retirees' benefits be slashed by -30% while current employees' pension benefits would be cut by -50% for a total collective reduction exceeding -40%. "With our current state, it will be difficult to turn around the company without public funds," he told the group, according to "Kyodo News." "I first want to explain the fact that pension reforms will be necessary to reconstruct our company through obtaining public funds in a way that can gain public acceptance."

Following the address, he told reporters that he is seeking current and former workers' "understanding" that it is necessary for pension benefits to be "largely slashed by over -40%." He added, "Without revising the pension plan, we cannot move forward" on a restructuring program. Nishimatsu told the former workers that he and his management team bore some responsibility for the airline's fiscal troubles and indicated he may resign once a viable restructuring plan is in place. "My biggest and last mission is to pass on the company . . . to the next generation," he said, according to "Kyodo." "I will make a decision on my future in an appropriate manner and it will not take long."

The "Dallas Morning News" published a transcript of comments made by (AAL) Chairman & CEO, Gerard Arpey at (AAL)'s fall leadership conference late last month, that made it clear it will fight hard to keep (JAL)/(JAS) in Oneworld (ONW). SkyTeam (STM) Chairman, Leo van Wijk said that his group is keen on recruiting (JAL)/(JAS).

"(JAL)/(JAS) . . . is under quite a bit of financial stress right now and our friends in Atlanta are trying to capitalize on that by suggesting that (JAL)/(JAS) . . . should change alliances [to] SkyTeam (STM)," Arpey told (AAL) executives. "We obviously think that would be a very bad idea for (JAL)/(JAS). That certainly would be very bad for us." He added that "(DAL) is very dominant through [subsidiary] Northwest [NWA] in Japan . . . If (JAL)/(JAS) were to change horses, we would certainly argue that they might not be allowed to even code share, let alone have immunity with the dominant carrier [at Tokyo] Narita."

Arpey said, "We are convinced that we can deliver the most meaningful alliance value to (JAL)/(JAS) by a wide margin . . . not to mention the financial costs (JAL)/(JAS) would incur if it changed alliances at such a critical phase in its restructuring."

Later, (JAL)/(JAS) said it reached agreement with the Development Bank of Japan for an emergency bridge loan "necessary for continuance of our flight operations." (JAL)/(JAS) said the Japanese government had approved the loan. (JAL)/(JAS) did not reveal the loan's amount but Japanese media pegged it at around ¥100 billion/$1.12 billion.

(JAL)/(JAS) is expected to enter into a turnaround program overseen by the Enterprise Turnaround Initiative Corporation (ETIC) of Japan, a newly created quasi-government entity designed to help rescue struggling companies, and proposed slashing its pension benefits by more than >40%. The (ETIC) restructuring program may take several weeks to finalize, necessitating short-term relief. (JAL)/(JAS) said in a statement that "an event which would interfere with our flight operations could occur" if didn't receive emergency funds.

The Japanese government reportedly is preparing to provide ¥700 billion/$7.74 billion in credit guarantees to (JAL)/(JAS) as part of an "extra budget" that could be finalized this week for the country's fiscal year ending March 31. Multiple press reports from Tokyo said the government wants to allay any doubts that (JAL)/(JAS) will continue to be able to operate as it goes through a restructuring expected to be overseen by the Enterprise Turnaround Initiative Corp of Japan.

Japanese analysts said the loan guarantee would not be the solution to (JAL)/(JAS)'s problems but would provide it with financial stability to weather its current crisis and complete a long-term restructuring. Gerson Lehrman Group analyst Addison Schonland wrote in a research note that owing to the loan guarantee, "(JAL)/(JAS) breathes deeper and easier, for now." But he said the move "puts the airline firmly in the hands of the state . . . As the state now calls the shots, we are likely to see (JAL)/(JAS) dismembered because assets will be sold to defray the investments." He projected that Nippon Cargo Airlines (NCA)ould take over (JAL)/(JAS)'s cargo business and a Low Cost Carrier (LCC) could be "pulled out" of the carrier. "So the loan guarantee seems likely to set off a series of next steps that will impact the entire Japanese airline industry."

Later, Japanese officials said that the government will not guarantee any loans extended to Japan Airlines (JAL)/(JAS). Finance Minister, Hirohisa Fujii said the government had agreed to "consider" backing some ¥100 billion/$1.09 billion in loans from the Development Bank of Japan (DBJ), "but it did not say we would actually do it." He added: "This is a matter that should be worked out by private companies. The (DBJ) is wholly owned by the state but it has the status of a private bank so the government is not allowed to meddle in its business," "Reuters" reported.

Securing additional funds and the support of the Enterprise Turnaround Initiative Corporation of Japan may depend significantly on whether (JAL)/(JAS) can finalize agreements with employees on pension relief. Transport Minister, Seiji Maehara said the government would "support" (JAL)/(JAS) during its restructuring. "The government will make sure (JAL)/(JAS) can gain support, including bridge loans, even if there aren't any state guarantees," he said. A final decision on pension relief is due January 12.

2 737-846s (35353, JA325J; 35354, JA326J), deliveries.

January 2010: Japan Airlines (JAL)/(JAS) President, Haruka Nishimatsu suggested that the carrier may resist efforts by the Enterprise Turnaround Initiative Corporation (ETIC) of Japan to push it into a court-monitored bankruptcy restructuring process rather than a more straightforward government bailout, expressing concern that the "image of bankruptcy" could sour the public on the company and lead to adverse consequences.

Speaking to "Asahi Shimbun," Nishimatsu noted that the (ETIC), which is being directed by the Japanese government to oversee (JAL)/(JAS)'s restructuring, appears to favor a court-monitored bankruptcy proceeding that would allow it to reach agreements with creditors. But he warned bankruptcy would carry negative connotations and "lead to a drop in customers . . . I don't see why [ETIC] prefers a court-managed process." He added, "I myself believe rehabilitation is possible without [bankruptcy] proceedings. I hope [the (ETIC)] will understand." He pointed out that (JAL)/(JAS) is making progress in securing cost-cutting concessions outside of court. To that end, the airline announced that the required two-thirds of its 16,000 employees have voted to agree to allow their pension benefits to be cut by -50%.

The Centre for Asia Pacific Aviation (CAPA) said the Japanese government is backtracking from hints it will underwrite (JAL)/(JAS)'s rescue owing to "strong opposition [among the Japanese public] to using taxpayers' money for a bailout." (CAPA) said Deputy Prime Minister, Naoto Kan has become a strong anti-bailout, pro-bankruptcy voice, arguing that "the electorate would not look favorably on a costly intervention" while much of the public is "suffering from the downturn."

Any restructuring likely will include a stake-holding agreement with either current Oneworld (ONW) partner, American Airlines (AAL) or Delta Air Lines (DAL), which is trying to lure (JAL)/(JAS) to SkyTeam (STM). While (JAL)/(JAS) insists it has not made a decision, Nishimatsu raised eyebrows when he told the newspaper that switching alliances "will require enormous work in system changes and other fields, but the question is whether we will put emphasis on Asia. In the future, Asia will have an "open skies" deal. In that respect, SkyTeam (STM) has many members in Asia." The USA and Japan reached agreement on an "open skies" accord last month.

(AAL) stated that reports that (JAL) has chosen (DAL) are "inaccurate and misleading," adding that it continues to negotiate with the Japanese carrier.

Meanwhile, the Development Bank of Japan agreed to double its emergency bridge loan to (JAL)/(JAS) to ¥200 billion/$2.15 billion, to help keep it airborne until it establishes a definitive restructuring plan.

Later, (AAL) announced that its offer in conjunction with Texas Pacific Group (TPG) Capital to invest $1.1 billion in troubled Japan Airlines (JAL)/(JAS) has been raised to $1.4 billion, according to "The Wall Street Journal." (AAL) reportedly met with (JAL)/(JAS) officials and informed them of the improved offer. (AAL) and Delta Air Lines (DAL) are jockeying to participate in (JAL)/(JAS)'s restructuring, which could take the form of a court-monitored bankruptcy proceeding. (DAL) has offered an investment package valued at around $1 billion, but President, Ed Bastian said that the offer may be raised. "We are willing and able to raise additional capital through third-party resources," he said. But he cautioned that "the focus should be on who provides the most [beneficial] long-term commercial partnership, not who provides the most short-term cash."

Meanwhile, Nikkei reported that (JAL)/(JAS)'s net loss for its full fiscal year ending March 31 is expected to exceed >-¥1.2 trillion/-$13 billion.

Signs continue to point toward (JAL)/(JAS) entering into a court-monitored bankruptcy proceeding, with reports from Tokyo indicating that both the Enterprise Turnaround Initiative Corporation (ETIC) of Japan, which will oversee the restructuring, and the Development Bank of Japan, (JAL)/(JAS)'s largest creditor, favor bankruptcy over a government bailout. (JAL)/(JAS) President, Haruka Nishimatsu has expressed reservations about bankruptcy, warning that it would carry negative connotations that could drive away passengers.

But government officials appear increasingly leery of a direct bailout, worrying that providing taxpayer funds to the troubled airline would be frowned on in a country hit hard by the recession. "Kyodo News" reported that (ETIC) is developing a restructuring plan that would include (JAL)/(JAS)'s filing for bankruptcy under Japan's Corporate Rehabilitation Law but also would provide special safeguards that would keep the airline flying and minimize the process's uncertainty, similar in some respects to a USA Chapter 11 filing.

(ETIC) reportedly would ensure that the carrier's shares will continue to be listed on the Tokyo Stock Exchange after the filing in order to limit disruptions to (JAL)/(JAS)'s normal business functions. It also would ensure that enough capital is injected into (JAL)/(JAS) to keep it operating through the bankruptcy process, including guaranteeing sufficient funding to allow it to pay for fuel and cover maintenance and other operational costs, and would push the carrier's major creditors to forgive hundreds of billions of yen in debt.

Nikkei reported that the (DBJ) backs this option over a bailout because even though it would take a financial hit, the court-monitored process would allow for greater transparency and make it easier for (JAL)/(JAS) to cut labor costs, giving it a better chance for longer-term viability.

It is not clear how a bankruptcy filing would affect (JAL)/(JAS)'s negotiations with (DAL) and (AAL) about one of those carriers taking a stake. (AAL) Senior VP Government Affairs, Will Ris told "Reuters" that the carrier is "flexible" and along with partner (TPG) Capital would be willing to invest in (JAL)/(JAS) even if it filed for bankruptcy. "We are okay either way [bailout or bankruptcy] and what we want to do is position ourselves so that we can act very quickly depending on which scenario takes place and make our capital investment available at that time," he said. He added that (AAL) is "continually in conversation with (JAL)/(JAS)."

The last word is that (JAL)/(JAS) is expected to announce that it will file for bankruptcy later this month as part of a turnaround plan that will include eliminating -15,600 jobs, according to news reports from Tokyo. "Kyodo News" stated that the Enterprise Turnaround Initiative Corporation (ETIC) of Japan, which will oversee (JAL)/(JAS)'s restructuring, is detailing a recovery path that will enable it to keep operating during bankruptcy but force it to make significant cuts in jobs, pension benefits and wages and to sell assets such as (JAL) Hotels. The job reductions, amounting to about -30% of its workforce, reportedly would be achieved by March 2013.

According to reports, (ETIC) will inject +¥300 billion/+$3.2 billion or more into the company to ensure (JAL)/(JAS) has enough cash to keep operating through the court-monitored process. The Japanese government's reluctance to provide the airline with a direct bailout reportedly is driving the decision to seek a court-managed restructuring. Meanwhile, Nikkei reported that (ETIC) will reject investment offers from both American Airlines (AAL) and Delta Air Lines (DAL), instead directing (JAL)/(JAS) to enter into an arrangement with one of the carriers that will involve close cooperation but no foreign ownership stake. However, (AAL) Chairman & (CEO), Gerard Arpey told the "Associated Press" that he has not been informed by (JAL)/(JAS) or the Japanese government that (AAL)'s bid will be rejected.

(AAL) confirmed that its offer to invest in (JAL)/(JAS) in conjunction with (TPG) Capital has been raised by +$300 million to $1.4 billion and said it and Oneworld (ONW) partner British Airways (BAB) will enhance cooperation with (JAL)/(JAS) to enable it to generate an additional +$500 million in revenue over the next three years. (AAL) has been jockeying with Delta Air Lines (DAL) to take a stake in (JAL)/(JAS), which appears to be on the verge of entering a court-monitored bankruptcy proceeding. However, reports from Tokyo indicate that (ETIC) favors rejecting foreign investment in the carrier and instead will push it toward noncapital commercial cooperation with either (AAL) or (DAL), which is attempting to lure (JAL)/(JAS) to SkyTeam (STM).

(AAL) Executive VP Finance & Planning plus (CFO), Tom Horton, speaking at a Tokyo news conference, said (ONW) has an "extraordinary commitment" to (JAL)/(JAS), which he claimed already generates around $500 million annually from its association with the (ONW) alliance. Enhanced cooperation with (ONW) partners can generate an additional $500 million over three years, he asserted. He said the incremental revenue would come primarily from closer ties with (AAL) and (BAB). An antitrust-immunized transpacific joint venture between (JAL)/(JAS) and (AAL) will "conservatively" generate an extra +$300 million over three years, he stated, adding that (AAL) "will guarantee this $100 million in new annual revenue for the first three years of the venture . . . to remove uncertainty."

In addition, (BAB) "has proposed a series of enhancements to its business relationships with (JAL)/(JAS) that will result in approximately $200 million in revenue over three years," Horton said. (BAB) Director Investments, Roger Maynard said (BAB) will "facilitate any decision by (JAL)/(JAS) to start services from [Tokyo] Haneda to London Heathrow (LHR)" by providing (JAL)/(JAS) with (LHR) "infrastructure . . . and slots" necessary for such services. He added that (BAB) would "double the number of European cities that (JAL) can reach through code sharing" on (BAB) flights from April.

Horton said (ONW) partners Qantas (QAN) and Cathay Pacific Airways (CAT) are willing to assist (JAL)/(JAS) with its "complicated restructuring" by providing "expertise," including (QAN) helping (JAL) launch a Low Cost Carrier (LCC) affiliate based on its JetStar Airways (IMU) model. (CAT) General Manager Japan, Simon Large noted that (ONW) is willing to guarantee that "(JAL)/(JAS) is the exclusive north Asia partner in this alliance."

(JAL)/(JAS) executives and the Japanese government have been circumspect about discussing details of the airline's restructuring publicly, but Japanese Transport Minister, Seiji Maehara did say that (JAL)/(JAS)'s largest creditors are on board with the airline's recovery plan, though he did not confirm details of the plan.

Kazuo Inamori, one of Japan's most prominent business figures, has accepted Prime Minister, Yukio Hatoyama's offer to become (CEO) of (JAL)/(JAS) and guide the troubled carrier through its pending bankruptcy reorganization. (JAL)/(JAS)'s current head, President, Haruka Nishimatsu is expected to step down as soon as next week, when the airline reportedly plans to file for bankruptcy under Japan's Corporate Rehabilitation Law. Nishimatsu has expressed misgivings about a court-monitored bankruptcy proceeding, warning that negative connotations associated with bankruptcy could drive away passengers.

But he appears to have lost the argument, with the state-backed (ETIC) of Japan, which will oversee (JAL)/(JAS)'s restructuring, mapping out a recovery strategy that will include bankruptcy. Nishimatsu has said that he and his management team bore some responsibility for (JAL)/(JAS)'s fiscal troubles and indicated he would resign once a viable restructuring plan is in place.

Inamori, 77, founded Kyocera Corporation in 1959 and built it into a premier high-tech company manufacturing a range of products including cell phones and solar power equipment. In 1984, he founded (KDDI), now Japan's second-largest telecommunications provider.

Though retired, the ordained Buddhist monk is a popular writer and lecturer in Japan and widely regarded as one the nation's leading business minds. "I don't know anything about the transportation industry, but I would like to make my best contribution," he told reporters. He acknowledged he would not work full time and would select a COO to handle day-to-day affairs. "I am old and a full time job is hard for me, so I would like to work three or four days a week and I will work for free," he said. "I have great expectations for a man whose managerial skill built Kyocera and (KDDI) in a single lifetime," Hatoyama said.

On his official website, Inamori wrote that he has "struggled with many dead-end situations which caused me endless agony" throughout his career, but has achieved "amazing results" by adhering to management principles he dubs the "Kyocera Philosophy." Among the key tenets are "clearly stat[ing] the purpose and mission of your business" and working to "measure your inflow and control your outflow. Don't chase profit, but let it follow your effort." He added that "business management requires a persistent, 'rock-piercing' will" and "a more combative mentality than any martial art."

Later, (ETIC) officially confirmed that it will guide (JAL)/(JAS)'s restructuring plan, pledging in a statement to "ensure all of its business operations on and off the ground [will] be performed smoothly without any interruption as usual with sufficient amount of capital" during the "revitalization" process. (ETIC) did not mention the carrier's expected bankruptcy filing, which is widely believed to be a central element of the turnaround plan being developed by the quasi-government entity. To guarantee that the airline can pay for fuel, maintenance and other operational costs, (ETIC) is expected to inject ¥300 billion/$3.2 billion or more into the company and secure forgiveness of hundreds of billions of yen in debt (JAL)/(JAS) owes to its largest creditors.

Japanese Transport Minister, Seiji Maehara told "Bloomberg News" that whatever process (JAL)/(JAS) goes through, "a certain amount of public funds will be needed . . . I can't clearly say how much it will cost." He added that Kazuo Inamori, the legendary Japanese business figure who has agreed to become CEO, will be with (JAL)/(JAS) for up to three years.

"If we steadily implement the rehabilitation plan that is being compiled by (ETIC), I believe revival is possible," Inamori told reporters.

Shortly after, Japan Airlines (JAL)/(JAS) filed for bankruptcy protection in Tokyo under Japan's Corporate Rehabilitation Law, initiating a restructuring process that it said will include major cost cuts and structural changes with the aim of returning to profitability by March 2012. Both (JAL)/(JAS) and the Japanese government insisted (JAL)/(JAS) will continue operating normally as it goes through the court-monitored proceeding. The government-backed (ETIC), which will oversee the restructuring, will inject ¥300 billion/$3.3 billion in capital into (JAL)/(JAS) and the Development Bank of Japan (DBJ) is extending the airline a ¥600 billion line of credit, funds that "will be sufficient to continue our business," the company said.

(JAL)/(JAS) stated in its court filing that its liabilities total a staggering ¥2.32 trillion. Transport Minister, Seiji Maehara conceded during a press conference that "if (JAL)/(JAS) was not [Japan's] biggest airline company, it would have been liquidated." Nevertheless, he and Prime Minister, Yukio Hatoyama emphasized (JAL)/(JAS)'s importance to the nation's economy and promised that it would not be allowed to collapse. "The government will support (JAL)/(JAS)'s efforts," Hatoyama said, encouraging passengers to continue flying aboard an airline that operates 1,100 flights daily and has a 66% international market share and a 46% domestic share in Japan. "Today is the starting point for (JAL)/(JAS)'s revival," Maehara said. "Needed support will be provided until it is reconstructed."

(JAL)/(JAS) President, Hakura Nishimatsu resigned effective immediately. As recently announced, Kazuo Inamori will take the helm as the company's new (CEO). "(JAL)/(JAS) symbolizes the slumping Japanese economy, so I accepted the job with the hope that its turnaround, if realized, would have a positive impact on the entire economy," said Inamori, who plans to rely on a new COO to handle day-to-day affairs. (JAL)/(JAS) said a new management structure will be "determined in early February." It added that Senior Managing Executive Officer, Masato Uehara will serve as "temporary" COO in the meantime.

(JAL)/(JAS) has laid out several basic premises upon which its turnaround plan is based, including a "proactive shift from low-efficiency large airplanes to high-efficiency smaller airplanes as well as regional jet airplanes." It said it would consolidate "under-performing" routes and is expected to eliminate 31. It will establish "a low-cost flight service model" for local flights and will cut about -15,600 employees, some -30% of its workforce.

(JAL)/(JAS) received approval from more than two-thirds of its current and retired workforce to reduce pension benefits significantly. Nishimatsu told a group of (JAL)/(JAS) retirees in November that the carrier needed to cut retiree benefits by -30%, while current employees' pension benefits would be slashed by -50% for a total collective reduction exceeding -40%. Another element of the turnaround plan is expected to be selling off non-core assets, such as (JAL) Hotels.

(ETIC), which said (JAL)/(JAS)'s debt exceeds its assets by ¥860 billion, is asking creditors to forgive more than ¥700 billion in liabilities. Its largest creditors reportedly are the (DBJ), Mizuho Corporate Bank, Bank of Tokyo-Mitsubishi, and Sumitomo Mitsui Banking Corporation. (JAL)/(JAS)'s net loss for its full fiscal year ending March 31 is expected to exceed -¥1.2 trillion. (JAL)/(JAS) will be delisted and stop trading on the Tokyo Stock Exchange on February 20.

Neither (ETIC) nor (JAL)/(JAS) made any comments regarding the ongoing efforts by American Airlines (AAL) and Delta Air Lines (DAL) to negotiate a capital investment in the struggling company. (JAL)/(JAS) said only that part of its route restructuring would be "leveraging our multiple alliances to expand our [international] networks." Currently a member of the Oneworld (ONW) alliance, it is considering switching to the SkyTeam (STM) alliance if it enters into a partnership with (DAL). The (ONW) alliance said that (JAL)/(JAS)'s "position in the (ONW) alliance is unaffected" and that (ETIC) has assured it that "it is business as usual for the airline commercially and operationally."

ST Aerospace, which provides heavy maintenance for (JAL)'s MD-11s, 747-400s, 767s and 777s, issued a statement saying that it understands "(JAL) may likely undergo some form of court-led restructuring similar to a Chapter 11 filing in the USA." It added that the government likely "will issue a statement to countries where (JAL) has operations to guarantee public support for its national carrier." President, Tay Kok Khiang said the ST Aerospace "will continue to work with the airline as we are confident that (JAL) will overcome its current difficulties."

Japan Airlines Group (JAL)/(JAS) named Japan Air Commuter President, Masaru Onishi President of both the Japan Airlines Corporation holding company and the Japan Airlines International (JAL) operating unit as well as (COO) for (JALS). Onishi, who joined the company in 1978, will join recently appointed (CEO), Kazuo Inamori in leading it through bankruptcy. (JAL)/(JAS) also named Hisao Taguchi, Executive VP of both the group and (JALI). He has run (JAL)/(JAS)'s Kyushu operation since last April.

February 2010: Japan Airlines (JAS) will end service from Shizuoka to Sapporo Chitose (CTS) and Fukuoka (FUK) on April 1, and from Matsumoto to Osaka Itami, (CTS) and (FUK) on June 1. It also will suspend cargo service to Ho Chi Minh City.

Months of high-stakes jockeying between the Oneworld (ONW) alliance's American Airlines (AAL) and the SkyTeam (STM) alliance's Delta Air Lines (DAL) over partnering with troubled Japan Airlines (JAL)/(JAS) came to an end when (JAL)/(JAS) announced it will stay in the (ONW) alliance and jointly apply for antitrust immunity (ATI) on transpacific routes with (AAL).

(JAL)/(JAS) President & COO, Masaru Onishi said (JAL)/(JAS), which last month entered into a court-monitored bankruptcy restructuring, had "analyzed this issue in great detail" and reached the conclusion that "the advantages of this development with (AAL) can strongly support (JAL)/(JAS) at a time when we are striving towards the revival of our business."

(JAL)/(JAS) Senior VP Corporate Planning, Daiji Nagai told reporters that the near-term stability gained from sticking with the (ONW) alliance outweighed the potential long-term benefits of jumping to the (STM) alliance, a move that would have given that alliance a dominant hold on the USA-Japan market. "We had a fierce debate over whether we should choose (DALO) and the (STM) alliance for future profitability or stay in the (ONW) alliance and avoid incurring a loss from making a switch this year," he explained. "If we don't survive the first two years, there will be no future for (JAL) after the third year of restructuring. We decided that we can minimize risk by staying with American (AAL)."

(JAL)/(JAS) said that upon receiving approval from the the USA Department of Transportation and the Japanese Ministry of Land Infrastructure, Transport and Tourism, it intends to enter into "a joint business venture (JV) [with (AA)] which will enhance [the two carriers'] scope of cooperation on the routes between the USA and Japan through adjustments to their respective networks, flight schedules and other business activities."

(ATI) approvals for (AAL)/(JAL)/(JAS) and for a similar (JV) between United Airlines (UAL)/Continental Airlines (CAL) and (ANA) are prerequisites for enactment of the Japan/USA "open skies" accord tentatively agreed to in December. It appears that (AAL) will not take a stake in (JAL)/(JAS) through a capital investment as previously had been considered. "We respect that this was an important decision for (JAL)/(JAS) . . . and we believe they have made the right choice for (JAL)/(JAS)'s many stakeholders, for Japan's national interests and for consumers travelling between Japan and the United States," said (AAL) Chairman & CEO, Gerard Arpey, who had vowed to "move aggressively to block" a (JAL)/(JAS) attempt to partner with (DAL). He added that (AAL) "remains confident" (ATI) will be cleared.

"The members of the (STM) alliance respect the decision made by (AL)/(JAS)," the (STM) alliance said in a statement. "We believe that cooperation with (JAL)/(JAS) would have brought good opportunities to all parties involved."

737-846 (35355, JA326J), delivery.

March 2010: Japan Airlines (JAL)/(JAS) posted a net loss of -¥177.9 billion/-$1.99 billion for the first three quarters of its fiscal year ended December 31, 2009, considerably widened from a -¥1.9 billion loss for the prior-year period. The result represented a record nine-month deficit for the bankrupt carrier, which said it is establishing an independent investigative committee to "examine past business practices." It said in a statement that it "recognizes and is deeply apologetic for the current situation that has caused great inconvenience and concern to our shareholders, financial creditors, customers, suppliers and other related parties."

(JAL)/JAS) filed for bankruptcy protection last month under Japan's Corporate Rehabilitation Law, admitting in court filings that its liabilities total ¥2.32 trillion. This month, it applied for antitrust immunity (ATI) to operate as one airline with Oneworld (ONW) alliance partner American Airlines (AAL) on transpacific routes.

Operating revenue for the nine-month period slumped -26.6% to ¥1.14 trillion, while expenses lowered -19.3% to ¥1.27 trillion, producing an operating loss of -¥120.8 billion, significantly widened from an operating loss of -¥8.8 billion in the prior-year period. Traffic decreased -9.5% to 58.15 billion (RPK)s on -9.5% capacity dip to 88.91 billion (ASK)s, producing a load factor of 65.4% LF, flat year-over-year. Cargo traffic declined -13.2% to 7.77 billion (RTK)s on a -14.8% cut in capacity to 13.05 billion (ATK)s, producing a load factor of 59.5% LF, up +1 point.

(JAL)/(JAS) announced that it will establish a "Compliance Investigations Committee," which it described as "an independent investigative organization formed by third-party members" including a current and former member of Japan's Supreme Court. "Committed to executing a fair and transparent restructuring under the Corporate Reorganization proceedings, [JAL/(JAS] will commission the committee to launch an investigation into past business management . . . to determine if there were any issues about compliancy and to identify problems in that aspect," (JAL)/(JAS) said.

Fiscal third-quarter net loss was -¥46.7 billion, widened -21.3% from a -¥38.5 billion deficit in the year-ago period, on a -21.6% slide in revenue to ¥380.8 billion.

(JAL)/(JAS) CEO, Kazuo Inamori, the iconic Japanese business figure who took the helm of the bankrupt carrier in January, told reporters that he has been surprised by the lack of business acumen among company executives but vowed to return (JAL)/(JAS) to operating profitability as soon as this fall. He candidly expressed his assessment of (JAL)/(JAS)'s corporate office in a Tokyo news conference, according to multiple reports, saying that an "extremely low" number of the airline's executives have business sense. He said he has told them, "You guys wouldn't be able to run a greengrocery with your ideas."

The carrier entered a court-monitored bankruptcy proceeding in January and last month reported a record nine-month net loss of -¥177.9 billion/-$1.99 billion) for the first three quarters of its fiscal year ended December 31. Inamori, 78, who was lured out of retirement by Prime Minister, Yukio Hatoyama to revive the troubled airline, said that (JAL)/(JAS) will "have to proceed with drastic restructuring including cost cutbacks" to survive. He said operating profitably on a monthly basis by this fall is possible. He rejected suggestions that the carrier will shrink its international network significantly, saying, "'I'm fully confident that we can make the international operation profitable. If we can't, there won't be any reason for (JAL)/(JAS)'s existence."

Japan Airlines (JAL)/(JAS)'s restructuring includes the retirement of a significant number of pilots (FC) this year, which could change the landscape of the Japanese air transport industry.

Geoffrey Tudor, a leading analyst with the Centre for Asia Pacific Aviation who also is the principal analyst with Tokyo-based Japan Aviation Management Research, said Japanese cockpit crew (FC) always have been in short supply and the need to hire foreign pilots (FC) has been a major barrier to expansion or entry.

He suggested that a "new supply of qualified pilots (FC) could be a big gain for (ANA)'s expansion plans, new airlines that are also looking to expand, would-be new entrants and low-cost carrier start-ups in the future."

He said that a "ready supply of qualified flight crew (FC) holding licenses issued by the Japan Civil Aviation Bureau is a chance that some airlines and would-be airlines in Japan will not want to miss." More than >1,500 captains now flying for (JAL)/(JAS) and 800 first officers (FC) aged 35 or older are eligible to apply for the (JAL)/(JAS) voluntary early retirement program by May 30.

Tudor noted that it is "unlikely that much will be said in public on the topic, but some (JAL)/(JAS) competitors are thought to be making plans to approach (JAL)/(JAS) flight crew (FC) members who may take the early retirement program."

April 2010: Japan Airlines (JAL)/(JAS) announced that it will cut -45 routes by the end of September as part of a radical shakeup intended to return it to profitability and sustainability. (JAL)/(JAS) filed for bankruptcy under Japan's Corporate Rehabilitation Law in January and CEO, Kazuo Inamori, who took the helm when it began the court-monitored reorganization process, has been indicating in recent weeks that cuts will be harsher than originally planned. The airline confirmed speculation by Japanese media that its reductions would be far more than the -30 previously expected when it unveiled a new route, flight frequency and fleet plan that will see it abandon many long-range routes and focus more intently on short/medium-haul services.

International capacity is being cut by -40% and domestic by -30%, translating into 86 weekly international and 58 daily domestic round trips. Among the destinations it will drop altogether as it axes -15 international routes are Amsterdam, Milan, Rome, Sao Paolo, Brisbane, Denpasar, and Kona. It also will terminate -30 domestic routes. "(JAL)/(JAS) has restructured its overall network with the clear objective of returning to profitability as swiftly as possible," it said in a statement.

The cuts are even more severe when considering that closures announced prior to its bankruptcy filing mean that total international routes slashed by this fall will amount to -28. Cumulative domestic routes cut will total -50. (JAL)/(JAS) also will also close 18 offices. Along with the route terminations, its 747-400 and A300-600 fleets will be grounded. Additionally, many routes will see a downsizing of equipment.

(JAL)/(JAS) said the plan has been "formulated to achieve within one year substantial reductions in the airline's fixed costs, a target which was initially planned to be accomplished over a period of three years." It added, "The extent to which the route and flight frequency plan has been streamlined is vital to achieving a swift revival of the (JAL)/(JAS) Group. (JAL)/(JAS) seeks the understanding of its customers who will be inconvenienced by the changes announced."

Part of the restructuring will include greatly expanding the use of Tokyo Haneda (HND) for international flights with a focus on pivotal routes that can yield higher business demand. New (HND) routes will include daily flights to San Francisco, Honolulu, Bangkok, and Paris Charles de Gaulle. (JAL)/(JAS) also will expand (HND) flights to destinations in Asia.

May 2010: 737-846 (35357, JA328J), delivery.

June 2010: Japan Airlines (JAL)/(JAS) will cut -19,300 jobs, more than originally planned but not quite as many as reported when (JAL)/(JAS) decided earlier this year to retrench more severely to turn around its business. Most of the positions will be abolished by the end of the current financial year, March 31, 2011.

(JAL)/(JAS), once Asia’s largest, will aim for a small profit this financial year. The new staffing plan will be part of a turnaround proposal to be submitted in August to the court that is handling the bankruptcy, says the "Yomiuri Daily." The government is supervising the restructuring through its Enterprise Turnaround Initiative Corporation. The original plan envisaged -15,700 job cuts, but creditors regarded that as inadequate. A cut of “about -20,000” was reported in March, but the actual figure will be -19,300. (JAL)/(JAS) will eventually be left with 32,600 employees, about -40% fewer than it and its subsidiaries had in January, when it filed for protection from creditors.

With 15 international and 30 domestic routes to be eliminated, revenue will fall -9% to ¥1.3 trillion/$14.1 billion this fiscal year, while operating costs will fall -22% to ¥1.28 trillion. The biggest contribution to the cost cuts will come from salaries, the "Nikkei" newspaper says, analyzing the turnaround plan, details of which were reported in major media.

2 737-846S (35358, JA329J; 35359, JA330J), sold to (GEF) at delivery and leased back.

July 2010: Japan Airlines (JAL)/(JAS) detailed its schedule for international operations from Tokyo Haneda (HND) beginning October 31, explaining that it will use its extensive network of domestic flights to/from the airport to feed passengers to international services and to offer arriving international passengers transport from (HND) to destinations throughout Japan.

Japan's Transport Ministry recently announced that (HND) would officially begin handling international scheduled flights on October 31 following the opening of its fourth runway and new international passenger terminal on October 21. (JAL) said it will serve San Francisco (SFO), Honolulu, Paris Charles de Gaulle (CDG), Bangkok, Singapore (SIN), and Taipei from the airport. It also will convert current charter flights from (HND) to Seoul Gimpo, Beijing, Shanghai, and Hong Kong into scheduled passenger flights.

"Counting the new international routes and an increase in one daily flight to Gimpo this autumn, (JAL) will be operating a total of 10 international routes with 13 daily flights," it stated. President & COO, Masaru Onishi said, "Haneda Airport is conveniently located in the heart of Tokyo and will be opened round-the-clock, greatly enhancing the convenience of travelers. Furthermore, with (JAS)'s extensive domestic operations at the hub, passengers can make smooth connections from our new international flights to many other destinations in Japan. We intend to fully utilize Haneda's strategic advantages for operations to Europe, America and Asia."

(JAL) added that "late-night flights from Haneda to Europe, America and long-haul Asia will complement existing daytime services at Narita to these regions and greatly expand flight options to meet the demands of business (C) travelers with convenient flight timings." International flights to/from (HND) will be operated with a mix of 767s and 777s and many will take advantage of the airport's 24-hour operations to operate at late hours with prime arrival times at destinations. For example, flights to (CDG) will depart at 1:30 am for a 6:20 am arrival, flights to (SFO) will depart at 12:05 am for a 4:05 pm arrival, and service to (SIN) will depart at 11:50 pm for a 6:30 am arrival.

The Japanese government reportedly is considering guaranteeing repayment of private bank loans to bankrupt Japan Airlines (JAL)/(JAS). According to Yomiuri Shimbun, the Enterprise Turnaround Initiative Corporation (ETIC)of Japan would back the loans in order to enhance (JAL)/(JAS)'s efforts to negotiate with creditor banks ahead of its rehabilitation plan deadline at the end of August.

The newspaper reported that Hideo Seto, Chairman of the government-backed turnaround body's committee overseeing (JAL)/(JAS)'s bankruptcy restructuring, said that the (ETIC) may throw a lifeline to (JAL)/(JAS) by guaranteeing repayment of about ¥500 billion/$5.7 billion in loans. Seto told media that "we'll probably reach an agreement by around early August."

The state-affiliated Development Bank of Japan and the turnaround body already have arranged a total of ¥650 billion in loans, of which half has been used. However, the government wants to switch (JAL)/(JAS)'s creditors to private banks as soon as possible to rehabilitate the airline with private-sector funds.

There are also calls for more route and staff cuts, which (JAL)/(JAS) warns could ruin its operations.

August 2010: Japan Airlines (JAL)/(JSA), in the midst of a bankruptcy restructuring, announced it will sell its 79.6% stake in (JAL) Hotels and additionally will merge four sales subsidiaries into one unit.

The (JAL) Hotels' shares will be acquired by Hotel Okura under terms of a stock transfer agreement. (JAL)/(JAS) is aiming the complete the transaction by the end of next month. Financial terms were not disclosed. "There has been intense competition in the hotel industry with a decline in guest figures following challenging economic conditions," (JAL)/(JAS) said. The airline filed for bankruptcy under Japan's Corporate Rehabilitation Law in January and said last week it is "aiming to make swift, fundamental reforms." The Japanese government reportedly is considering guaranteeing repayment of private bank loans to (JAL)/(JAS) ahead of the company's deadline at the end of this month to file its official rehabilitation plan.

(JAL)/(JAS) said it will keep an 11.1% stake in (JAL) Hotels and the brand names of hotel chains owned by the company, "Hotel Nikko" and "Hotel (JAL) City," will "be retained" and guests will still be able to accumulate (JAL) frequent flyer miles. The airline said it plans to cooperate "closely with Hotel Okura as a strong business partner." (JAL) founded (JAL) Hotels in 1970. It now manages 58 hotels including 40 in Japan.

(JAL)/(JSA) announced that four of its subsidiary sales companies (JAL Sales Company, (JAL) Sales Hokkaido Company, (JAL) Sales West Japan Company and (JAL) Sales Kyushu Company) will be merged into a single company called (JAL) Sales from October 1. The combination "will constructively draw together the strengths of the four companies in terms of marketing and sales expertise, management skills, human resources (HR) and know-how," (JAL) said, adding that it would "rapidly improve …operating efficiencies and…help drive the early recovery of [JAL]/(JAS)."

(JAL)/(JAS), undergoing bankruptcy rehabilitation, plans to cut -19,133 jobs from its workforce of 47,000 by the end of March 2015, according to documents cited by "Kyodo News." (JAL)/(JAS) filed for bankruptcy under Japan's Corporate Rehabilitation Law in January and is facing an August 31 deadline for filing its official reconstruction plan. "Kyodo," citing a final draft of that plan, unveiled many of the airline's targets for cuts, some of which are more severe than previously stated. For example, (JAL)/(JAS)'s prior high estimate on job cuts was around -16,000.

The job cuts and overall reduction of associated costs are expected to bring (JAL)/(JAS) savings of -¥255.2 billion/-$2.98 billion in its 2011 to 2012 fiscal year, according to a "Reuters" summary of "Kyodo's" report. By 2014, (JAL)/(JAS) hopes to post a +¥106.7 billion net profit, according to the draft plan.

Even while slashing staff and selling off assets, (JAL)/(JAS) said it plans to continue with the introduction of 65 new airplanes comprising 737-800s, 777-300ERs and 787-8s. It will retire 22 A300-622Rs and 36 747-400s by March 2011. Some 25 MD-80/-90s are also slated to be retired during the restructuring process.

"Kyodo" additionally reported that (JAL)/(JAS) plans to sell off two subsidiaries, Chubu Sky Support Company and (JAL) Ground Service Kansai Company, which manage ground operations for Chubu and Kansai airports, respectively.

The painful restructuring of Japan Airlines (JAL)/(JAS), which is under bankruptcy protection, is reflected in its traffic results for the traditional Japanese summer vacation period August 6 to 15. (JAL) carried 325,498 passengers on international flights during the 10 days, down -11.9% compared to the same period last year, although load factor jumped +5.9 points to 89.2% LF on a -17.7% (ASK) drop in capacity. On domestic routes, (JAS) carried a total of 1,146,315 passengers, -10.8% less than a year ago. Domestic capacity was down -8.2% (ASK)s.

(JAS), which is working on a restructuring plan to return to profitability, is preparing to eliminate its MD-81s in the coming weeks. As of April 1, (JAS) had nine MD-81s, the last of which will be disposed of at the end of September, says a (JAS) spokeswoman. These airplanes are used on older domestic routes, she says. Japan Airlines (JAL) also announced in late April that it would be getting rid of its 47-400s and A300-600s by the end of March 2011 and discontinuing services on 15 international and 30 domestic routes. The airline will replace these older and larger aircraft with smaller
equipment in an effort to find the most efficient size for its fleet, says the spokeswoman. She says the (JAL) has 36 747-400s and 22 A300-600s.

(JAL)/(JAS) is in bankruptcy protection after incurring massive
losses. It will announce its “revitalization plan” at the end
of this month, says the spokeswoman. This is the financial
turnaround plan that (JAL)/(JAS) is working on in collaboration
with the government-backed Enterprise Turnaround Initiative
Corporation of Japan.

(JAS) will increase the number of daily flights between Tokyo Haneda and five domestic destinations from October 31. (JAL)/(JAS) filed for bankruptcy in January under Japan's Corporate Rehabilitation Law.

737-846 (40346, JA331J), delivery, ex-(N179SB).

September 2010: Japan Airlines (JAL)/(JAS) unveiled a more radical restructuring plan than expected, calling for the retirement or layoff of more than >-16,000 staff by March 31, 2011, as well as the disposal of 103 airplanes and the scrapping of 49 loss-making routes.

(JAL)/(JAS) outlined its ambitious reorganization plan aimed at achieving a profit margin of 9.2% by March 2013 in a filing with the Tokyo court overseeing its bankruptcy case under Japan's Corporate Rehabilitation Law. It had been considering eliminating more than >-19,000 jobs but at a more gradual pace. Initially, (JAL)/(JAS) had suggested that just 31 routes would be terminated.

The restructuring package is dependent on a ¥521.5 billion debt waiver from financial institutions including the Mitsubishi UFJ Financial Group, Sumitomo Mitsui Financial Group, Mizuho Financial Group and the Development Bank of Japan. The state-affiliated Enterprise Turnaround Initiative Corporation of Japan announced it will inject another ¥350 billion into the airline.

(JAL)/(JAS) is aiming for a November 30 court approval of its reorganization plan and intends to implement it from December 1. Key points include reducing employment from 48,714 as of March 31, 2010 to "roughly 32,600" by next March; reducing and downsizing the fleet; eliminating unprofitable routes; reforming airport cost structures and facilities; reviewing wage and benefit systems; liquidating and selling subsidiaries including hotel businesses; and enhancing its network via utilization of bilateral alliances with other carriers, particularly Oneworld (ONW) alliance partner, American Airlines (AAL).

The changes will be matched by what the airline called "a more efficient and strategic organization that is capable of reliably sharing the [company's] managerial policy." In a stark admission of past failings, (JAL)/(JAS)'s court submission said airline executives must learn "more quickly [about] the actual state of the Group's profit and loss." A panel of experts determined in August that "mismanagement and a lack of risk awareness" led (JAL)/(JAS) to bankruptcy.

In its court filing, (JAL)/(JAS) said it will be "clarifying where the responsibility lies for meeting numerical targets." It will construct a management control structure that is capable of reliably executing business plans."

(JAL)/(JAS) said it had debt of ¥959 billion/$11.3 billion as of the March 31 end of its fiscal year. It filed for bankruptcy in January with liabilities totaling ¥2.32 trillion.

(JAL)/(JAS) said it reached a stock transfer agreement with Hamakyorex, which owns and manages cargo distribution centers, to sell (JAL)/(JAS) its 72% stake in JAL Logistics. The move is part of (JAL)/(JAS)'s continuing effort "to achieve a swift and fundamental reform" via its ongoing bankruptcy reorganization process. Selling off subsidiaries is a key plank of its aggressive restructuring plan.

Founded in 1970, JAL Logistics provides ground transportation, warehousing, airfreight forwarding and customs clearance services to (JAL)/(JAS) and other clients. (JAL)/(JAS) said in a statement that Shizuoka-based Hamakyorex "possesses a high level of know-how in the field of third party logistics. Going forward, under the management of Hamakyorex, JAL Logistics will develop into an efficient third party logistics business that can offer customers the most suitable solutions that match their distribution needs." (JAL)/(JAS) is targeting October 1 for transferring its 172,700 shares in JAL Logistics to Hamakyorex.

(JAL)/(JAS)'s fleet changes involve the grounding of all its 747-400s, A300-600s, MD-81s and MD-90s by March 31, 2011, with the fleet going forward to be built around the 787, 777, 767, 737 and Embraer E170.

"This revitalization plan is the start of the rebirth of (JAL)/(JAS)," (CEO), Kazuo Inamori told reporters in Tokyo. "We must do our utmost to make sure that this does not end as just fantasy."

November 2010: The Tokyo court handling Japan Airlines (JAL)/(JAS)'s bankruptcy approved the company's restructuring plan calling for the retirement or layoff of more than >16,000 staff by March 31, 2011, the disposal of 103 airplanes and the scrapping of 49 loss-making routes.

(JAL)/(JAS) aims to achieve a profit margin of 9.2% by March 2013. The restructuring package includes a ¥521.5 billion/$6.2 billion debt waiver from financial institutions including the Mitsubishi UFJ Financial Group, Sumitomo Mitsui Financial Group, Mizuho Financial Group and the Development Bank of Japan. The state-affiliated Enterprise Turnaround Initiative Corporation (ETIC) of Japan will inject another ¥350 billion into the airline, effectively becoming its owner for the time being. The plan calls for the re-listing of (JAL)/(JAS)'s stock following an Initial Public Offering (IPO) by the end of 2012.

(JAL)/(JAS) President, Masaru Onishi told a Tokyo news conference that the company will conduct "the rehabilitation plan faithfully," while Chairman, Kazuo Inamori said the -16,000 job cuts would be achieved "no matter what in order to turn (JAL)/(JAS) into a strong company." Onishi said the size of (JAL)/(JAS)'s workforce needs to be "appropriate to the scale of business."

Inamori revealed that even with the (ETIC) injection, JAL will still need another ¥50 billion. He suggested that the high-tech company he founded in 1959, Kyocera Corporation, "has ample capital" and could "provide such support." (JAL)/(JAS) filed for bankruptcy under Japan's Corporate Rehabilitation Law in January with liabilities totaling a staggering ¥2.32 trillion.

A key component of the company's restructuring strategy has been the offloading of non core assets, and (JAL)/(JAS) announced it has reached a stock-transfer agreement to sell its 50.7% stake in airline caterer (TFK) Corporation to Singapore's (SATS). (TFK) has a strong presence at both Tokyo airports, Narita and Haneda.

The (JAL) Group announced a change in (JAL)/(JAS)’s organizational structure under renewed management. In order to “realize an effective and speedy revitalization,” (JAL)/(JAS) said it aims to create a “leaner financial constitution” while “maintaining the highest levels of safety” in its operation. These changes, which will include a change in the board of executive officers, are expected to take place from December 15.

According to (JAL)/(JAS), current Chairman, Kazou Inamori and President, Masaru Onishi will retain their positions. Akitoshi Nakamura, representative Director of a state-backed bankruptcy administrator, will assume the newly created post of Assistant to Inamori. Senior Managing Director, Koichi Mizutome will assume the post of Executive VP; Kyocera Communication System Company Chairman, Naoyuki Morita will share the Executive VP role with Mizutome.

Retiring from December 14 will be Senior Managing Executive Officers, Hiroyasu Omura and Chihiro Tamura, along with seven other executive officers.

In September, (JAL)/(JAS) unveiled a restructuring plan, calling for the retirement or layoff of more than >-16,000 staff by March 31, 2011, as well as the disposal of 103 airplanes and the scrapping of 49 loss-making routes.

The USA Department of Transportation on November 10 gave final approval for antitrust immunity (ATI) to (JAL)/(JAS) and American Airlines (AAL) for a transpacific joint business in early 2011.

73-846 (40349, JA334J), ex-(N1786B) and 767-346ER (40365, JA653J), deliveries.

January 2011: Japan Airlines (JAL)/(JAS) said its Information Technology (IT) joint venture (JV) with (IBM) launched in 2001 will be "significantly reorganized" to enable (JAL)/(JAS) to have independent control of developing and operating (IT) systems as it moves toward emergence from its bankruptcy restructuring. By the end of June, (IBM) Japan's 51% stake in (JAL) Information Technology (IT) (JIT) will be transferred to (JAL), giving the airline a more than >90% holding in the company.

Under a reworked outsourcing agreement, (IBM) Japan "will continue to provide services in the area of system usage," (JAL) said in a statement, adding that the new contract terms will be in effect through June 2014. (JAL) (IT) "has been creating and maintaining business applications and providing almost all aspects of (IT) services to the (JAL) Group and has accumulated extensive know-how in related fields," (JAL) noted. "To ensure plans for the system renewal run smoothly in support of the revitalization of (JAL)/(JAS), it is essential to reinvigorate (JAL)/(JAS)'s internal (IT) department alongside the development of (JIT). From hence, (JIT) will operate distinctly as a core subsidiary providing fundamental support."

February 2011: A local high-speed rail operator is planning to build the world’s fastest train from Tokyo to Nagoya.

March 2011: Japan Airlines (JAL)/(JAS) officially unveiled the reintroduction of its iconic crane livery on a 767-300ER at its maintenance center at Tokyo Haneda. The change in logo was announced January 19 to emphasize (JAL)/(JAS)'s “new philosophy and corporate policy underscoring a re-commitment to provide the highest levels of service to customers.”

(JAL) Group President, Masaru Onishi said the “significance of adopting this new motif after a year since we entered the corporate reorganization proceedings in January 2010 is to mark the rebirth of Japan Airlines (JAL)/(JAS).” SEE ATTACHED - - "JAS-2011-03-TAIL LOGO CHANGE-A/B."

Ironically, (JAL)’s last 747 flew into retirement the following day. (JAL) at one time operated the world’s largest fleet of 747s. (JAL)’s first 747 in service was in 1970 on the Tokyo Haneda - Honolulu route.

Tokyo Narita (NRT) and Haneda (HND) airports partially reopened for some flights after a massive 8.9 magnitude earthquake forced the busy facilities to shut down for most of the day, leaving thousands of passengers stranded. Sendai Airport, close to the epicenter of the quake in northeast Japan, was inundated by a tsunami, with photos from the scene showing people gathered on the roof of a terminal to avoid flood waters.

News reports from Tokyo estimated that more than >20,000 people were stranded at (NRT) and (HND) in the aftermath of the earthquake. Airlines throughout the world announced that flights to Tokyo had been cancelled, delayed or diverted, with All Nippon Airways (ANA) saying around 130 of its flights were axed. Finnair (FIN) said it has canceled its flights to Tokyo and the return flights from Tokyo to Helsinki. Its flights to Nagoya and Osaka will operate normally. USA airlines canceled most flights to and from Japan.

"Kyodo" news agency reported that 700 flights overall have been cancelled as a result of the quake. Neither (NRT) or (HND) has reported serious damage. Some flights en route to Tokyo at the time of the quake were diverted to airports in southern Japan such as Osaka Kansai, while others went to Seoul Inchon.

Momentum in the air transport operational recovery in Tokyo following the devastating earthquake and tsunami could be difficult to maintain in the face of growing fears over radiation exposure from unstable nuclear reactors. Tokyo Narita and Haneda reported no major damage from the quake and flights to/from the airports were mostly operating normally the following Monday. But airlines on Tuesday started announcing new flight adjustments as the situation at the Fukushima nuclear facility worsened.

Japanese Prime Minister Naoto Kan warned that there is "still a very high risk of further radioactive material escaping" from damaged nuclear reactors in northeast Japan. The country has imposed a no-fly zone for civil airplanes in a 18-mile radius over the troubled Fukushima power plant.

Reports from Tokyo describe full outbound flights and passengers gathering at the airports hours before scheduled departures. Narita (NRT) said nearly 1,100 passengers were still stranded in its passenger terminals.

Derek Sadubin, a senior analyst with the Center for Asia Pacific Aviation (CAPA), said air travel to and from Japan is likely to be severely disrupted with changes in traffic flows possible. "Japanese tourists make up 25% of the Hawaiian market and 16% of the Australian market and in the short-term, trips are being canceled," he explained. He noted that one complicating factor is that the Japanese have generally chosen not to travel in the aftermath of previous disasters out of respect for the victims. The outbound Japanese air travel market is estimated at over 30 million passengers annually.

Most airlines said service to Tokyo would remain on schedule while the situation is carefully monitored. Japan Airlines (JAL)/(JAS) said all flights to Sendai are canceled until at least March 26 but added it will operate 32 extra flights to help move people and supplies to the most hard-hit areas. It will operate some flights to Hanamaki Airport, which is now reopened. Scheduled flights to the affected region will be operated with larger airplanes. Included in the 32 added flights will be two between Haneda (HND) and Yamagata.

April 2011: Japan Airlines (JAL)/(JAS) said it will offer a limited number of administrative and maintenance staff (MT), flight attendants (CA) and pilots (FC) “special unpaid leave during the months of May and June” as a result of capacity reductions in the aftermath of the devastating natural and nuclear disasters in Japan. Recently, (JAL)/(JAS) announced a temporary reduction in capacity on international and domestic routes.

All Nippon Airways (ANA) and Japan Airlines(JAL)/(JAS) will operate relief flights to Sendai Airport (SDJ), more than a month after the airport was inundated by water following the March 11 earthquake and tsunami that devastated Japan's northeast. The badly damaged airport has been closed to commercial flights.

The Japanese government announced that it will "partially" reopen the airport. "The airport is being opened sooner than originally expected," (ANA) said, crediting the efforts of the Japanese transport ministry, the Japanese and USA militaries and "other organizations." (ANA) will operate thrice-daily, (SDJ) - Tokyo Haneda airport (HND) relief flights using a 737-800 painted with the message, "Forward together as one, Japan." The message will also be painted on several other (ANA) airplanes in both Japanese and English.

(JAL)/(JAS) said that while "operating conditions at Sendai Airport remain subject to change," it plans to operate daily flights to (SDJ) from (HND) and Osaka Itami (ITM) from April 13 to 20 utilizing 737-800s. It has also extended the temporary suspension of (SDJ) flights from Fukuoka, (ITM) and Sapporo until May 31. Since March 12, (JAL)/(JAS) has operated "more than >700 extra flights to airports in the north, namely Yamagata, Hanamaki, Akita and Aomori from Tokyo, Osaka and Sapporo," it said.

Japan Airlines (JAL)/(JAS) announced it is operating extra flights to Tohoku during the Japanese Golden Week holidays, from April 29 to May 8. (JAL)/(JAS) also added extra flights from Tokyo Haneda and Osaka Itami to Aomori on April 28.

May 2011: The (JAL)/(JAS) Group reported a consolidated operating profit of +¥188.4 billion/+$2.3 billion for the 2010 - 2011 fiscal year ended March 31, (JAL)/(JAS) said. It reported operating revenue of ¥1.36 trillion. (JAL)/(JAS) posted an operating profit of +¥147.7 billion and operating revenue of ¥1.14 trillion for the 2010 to 2011 year. (JAL)/(JAS) lost -¥649.5 million in its fiscal year ended March 31, 2009. It filed for creditor protection in January 2010 and emerged from its court-monitored bankruptcy restructuring in March 2011. It endured a steep drop in demand in the aftermath of the March 11 earthquake, tsunami and nuclear disaster.

(JAL)/(JAS) will operate non-scheduled extra round trip flights to Yamagata from Tokyo Haneda (May 13) and Sapporo, as well as to Hanamaki from Osaka Itami and Sapporo between May 9 to 22.

July 2011: "Nikkei Business Daily" reported that Japan Airlines (JAL)/(JAS) will team up with Australia's Jetstar (IMU) to create a new Low Cost Carrier (LCC).

August 2011: Japan Airlines (JAL)/(JAS) will expand its Boeing (TBC) Airplane Health Management (AHM) coverage to its future 787 fleet. (AHM) is a software system that monitors, collects and analyzes airplane data to give airplane customers valuable, real-time maintenance information. This information allows (JAL)/(JAS) to initiate the needed maintenance immediately upon arrival at the airport gate.

(JAL)/(JAS) has 35 787 airplanes on order, and has licensed (AHM) for these airplanes in addition to its existing fleet of 46 777 airplanes.
“The (AHM) program has been helping (JAL)/(JAS) optimize the reliability of our fleet of 777s, and it will greatly support a successful introduction of the 787 into the family,” said Nobuhiro Sato, Executive Officer Engineering & Maintenance, (JAL)/(JAS). “On-time performance is very important to passengers and our goal is to continue providing our customers a positive experience.”

(JAL)/(JAS) was a developmental partner for the original (AHM) development effort and has used the service continuously since 2005. (JAL)/(JAS) will use the (AHM) Real Time Fault Management Module on their 777 and 787 airplanes to communicate in-flight information to ground stations for diagnosis and quick operational decisions by scanning troubleshooting and historical repair data. (JAL)/(JAS), recognized in the last 2 consecutive years as the most punctual major global airline, uses the system’s output to organize any needed maintenance operations and put the right people, parts and equipment in the right place at the right time for faster turnaround.

“Delivering real-time decision support information that improves airplane performance has proven to be very valuable to our customers,” said Per Noren, VP Information Services for Boeing Commercial Aviation Services (TBC).

(AHM) is easily accessed through the MyBoeingFleet.com portal. Alerts and notifications are delivered to airline personnel through a variety of communication methods including internet, personal digital assistants (PDA)s, e-mail and mobile devices. (AHM) is a key component in the larger Boeing (TBC) vision of helping customers succeed by transforming data into information they can use in real time to operate as efficiently as possible.

Qantas (QAN) low-cost carrier (LCC) subsidiary, Jetstar Asia (JSA) is expected to set up an airline in Japan as the demand for cheaper travel sweeps across Asia. The new carrier will be a partnership between Jetstar Asia (jsa), Japan Airlines (JAL)/(JAS) and the Mitsubishi Corporation.

The yet-to-be named airline will be launched at the end of 2012 and will be based at Tokyo Narita. The most likely name will be "Jetstar Japan," or simply "JJ."

According to sources in Australia, Mitsubishi will own 33.4% and (JAL)/(JAS) and Jetstar (IMU) will hold 33.3% each.

Discussions surrounding a (LCC) partner for (JAL)/(JAS) date back to January 2010 when (JAL)/(JAS) entered into a government-supervised bankruptcy restructuring. The (LCC) was touted as part of the reconstructed (JAL)/(JAS).

However, in October last year, (JAL)/(JAS) Chairman Kazuo Inamori appeared to pour cold water on a (LCC), telling media he had reservations about delving into (LCC) operations. "I think we should refrain from chasing after scale expansion," he said. "Look at the USA example, where many low-cost carriers (LCC)s that entered the market have since exited."

October 2011: The Qantas (QAN) Group's low-cost carrier (LCC) subsidiary, Jetstar Japan has named Miyuki Suzuki as (CEO) of the recently launched joint venture (JV) airline. Jetstar Japan is a partnership between the Qantas Group, Japan Airlines (JAL)/(JAS) and the Mitsubishi Corporation.

Suzuki, a Japanese national with 30 years of Information Technology (IT) and telecommunications experience across the Asia Pacific region, will start his job on December 1st.

Jetstar Japan, which hopes to begin operations by the end of 2012, will have a fleet of new Airbus A320s, configured for 180 passengers. The fleet will grow to 24 airplanes within the 1st few years. Initially, the (LCC) will fly domestically with short-haul international flights expected to start in 2013. It will announce domestic destinations by mid-2012, to possibly Sapporo, Fukuoka, and Okinawa.

November 2011: Cathay Pacific Airways (CAT) announced an expansion of its code share with Japan Airlines (JAL)/(JAS) under which its (CAT) code will be placed on selected (JAL)/(JAS) service from Tokyo Haneda to Izumo, Miyazaki, Misawa, Matsuyama, Nagasaki, Oita, Tokushima, and Ube; Tokyo Narita - Nagoya; and Sapporo - Nagoya.

January 2012: Japan Airlines (JAL)/(JAS), which exited bankruptcy last year, is planning an initial public offering (IPO) that may raise as much as ¥1 trillion/$13 billion as early as September.

A (JAL)/(JAS) spokesman confirmed to "Bloomberg" that Nomura Holdings and Daiwa Securities Group have been hired to lead the (IPO), and the airline is seeking overseas underwriters.

Japan’s Enterprise Turnaround Initiative Corporation (ETIC), the government-affiliated agency, holds 97% of (JAL)/(JAS)’s voting rights. Other stakeholders are considering selling ¥500 billion to ¥1 trillion of shares.

(JAL)/(JAS) reported a consolidated operating profit of +¥188.4 billion for the 2010 - 2011 fiscal year ended March 31. It filed for creditor protection in January 2010 and emerged from its court-monitored bankruptcy restructuring in March 2011.

(JAL)/(JAS) plans to submit its (IPO) filing to the Tokyo Stock Exchange in July, "Bloomberg" said.

(ETIC), which injected ¥350 billion of capital as part of the airline’s bankruptcy, must sell its stake by January 2013, three years after taking over (JAL)/(JAS).

(JAL)/(JAS) has outlined its plans for routes, fleet and flight frequency for the 1st half of fiscal year 2012 year ending March 31, 2013, as the 787 is introduced into service.

According to (JAL)/(JAS), it will launch the 1st 4x-weekly, 787 nonstop service between Tokyo Narita (NRT) and Boston April 22, increasing to daily from June 1.

(JAL)/(JAS) plans to deploy the 787 on 5 existing 777 and 767 routes in (JAL)'s international network from the end of March. Routes include (NRT) - Delhi, (NRT) - Moscow, Tokyo Haneda (HND) - Beijing, (NRT) - Singapore (SIN) and (HND) - (SIN).

(JAL) said it will increase flight frequencies on its (NRT) - (SIN) route from 7x-weekly to 14x-weekly from October 28.

On the domestic side, (JAS) plans to reinstate daily Fukuoka - Hanamaki service from March 25, as well as 2x-daily, Niigata - Sapporo service from July 13. (JAS) will also schedule an increase in flight frequencies on 9 other routes from (HND), Osaka Itami, Osaka Kansai, Sapporo and Chubu, and will suspend its Chubu - Ishigaki route from March 25.

2 737-846s (39190, JA340J; 40356, JA341J), deliveries.

February 2012: Japan Airlines (JAL)/(JAS)’s (JAL) Group reported consolidated net income of +¥146 billion/+$1.92 billion for the period April 1 - December 31, 2011, the 1st 3 quarters of the fiscal year ending March 31.

The Group reported total operating revenue of ¥909.1 billion, operating costs of ¥747.4 billion and operating income of +¥161.6 billion.

Japan Airlines (JAL)/(JAS) in March 2011 completed its court-monitored bankruptcy restructuring under Japan's Corporate Rehabilitation Law, and also announced more flight reductions as it dealt with a steep drop in demand in the aftermath of the March earthquake and tsunami.

(JAL)/(JAS) said it “continued to review airplane scheduling on each route and enforced measures to increase revenues, while examining every cost category to achieve greater cost reduction, such as in fuel costs. Profit consciousness of each department has also been enhanced through the implementation of a new revenue management system introduced last April, which has helped to increase management efficiency.”

(JAL)/(JAS) said consolidated international capacity declined year-over-year by -21.2% (ASK)s, and traffic (RPK)s were down -27.5%. Load factor was 68.8% LF, down -6 points on the year-ago period. Revenue from international passenger operations for the 1st 3 quarters of the fiscal year on a consolidated basis was ¥288.9 billion, representing 31.8% of total revenue.

Domestic (ASK)s declined -17.7% year-over-year, while (RPK)s declined -16.9%. Load factor rose slightly to 63.3% LF. Domestic passenger revenue in the 1st 3 quarters of the fiscal year on a consolidated basis was ¥367.2 billion, representing 40.4% of total revenue.

Pratt & Whitney (PRW) has signed 2 7-year agreements worth an estimated $450 million with Japan Airlines (JAL)/(JAS) to provide maintenance services for its (PW4090) engines, as well as part repair services for its fleet of (PW4074), (PW4077) and (JT9D) engines.

Japan Airlines (JAL)/(JAS) has placed a firm order for 10 787-9s and converted 10 787-8s it already had on order to 787-9s.

The new order and conversion bring (JAL)/(JAS)'s total 787 Dreamliners on order to 45, comprising 25 787-8s and 20 787-9s. It also still has 20 787 options.

"The 787-9 is a slightly larger version that can fit approximately 50 more seats than the 787-8 configured for international routes," JAL said in a statement. "Equally efficient as the 787-8 but with more seat capacity, the unit cost per seat on the 787-9 is estimated to be lower."

JAL plans to put its first 787 into service in April.

May 2012: The (JAL) Group (JAL)/(JAS) reported a consolidated net profit of +¥186.6 billion/+$2.33 billion in the fiscal year 2011, which ended March 31.

Operating revenue was ¥1.205 trillion, while expenses were ¥999.8 billion, producing an operating income of ¥204.9 billion.

(JAL)/(JAS) said it was badly impacted by the aftermath of the earthquake and tsunami that hit Japan in March 2011 as well as floods in Thailand later in the year. Balancing this, the strong yen boosted tourist traffic and some routes, such as India, showed growth.

Consolidated international passenger capacity declined -16.8% for the reporting period when measured in (ASK)s; demand declined -20.3% in terms of (RPK)s year-over-year.

Domestic passenger capacity fell -13.5% in terms of (ASK)s and demand reduced -12.3% in terms of (RPK)s compared to the year-ago period. Load factor was +0.8 points, up to +62.7% LF from the same period last year.

“The outlook for fiscal year 2012 is uncertain due to the prevailing economic situation faced by the company, such as concerns of a downward swing in the global economy due to the European financial crisis and rising fuel prices caused by geopolitical risks in the Middle East.” However, (JAL)/(JAS) said the operating environment is “entering a new phase with the launch of (JAL)/(JAS)’s 787 Dreamliners and the entry of low-cost carriers (LCC)s into the Japanese market.”

Japan Airlines (JAL)/(JAS) and the International Airlines Group (IAG) (BAB)/(IBE) have been granted antitrust immunity (ATI) from the Japanese Ministry of Land, Infrastructure, Transport & Tourism (MLIT) to cooperate commercially on flights between Europe and Japan.

The joint business, which will provide better links and more routes between the European Union (EU) and Japan, is expected to launch by late March 2013.

The revenue-sharing agreement will strengthen the Oneworld (ONW) alliance, enabling it to compete more effectively with other global alliances, according to (JAL)/(JAS).

(JAL) President Yoshiharu Ueki said, "Amid the evolving Japanese aviation industry, the (ATI) will enable us to build a strong value-creating relationship with British Airways (BAB) that can benefit our customers as well as our businesses.”

July 2012: Japan Airlines (JAL)/(JAS) is pressing on with plans to return to the stock market, the company confirmed. “It is true that the (JAL)/(JAS) is aiming to relist, but we are not able to discuss any details of its schedule or size,” a company official said.

(JAL)/(JAS) President Yoshiharu Ueki had said in the "Financial Times" that the relisting was “proceeding as scheduled. We are under tight restrictions not to discuss any details related to the Initial Public Offering (IPO), so Mr Ueki gave no comments on that,” the (JAL)/(JAS) official explained.

After its 2010 bankruptcy, (JAL)/(JAS) introduced a rigorous cost and fleet-planning exercise that has seen it return to the black. It posted profits of +JPY186.6 billion/+$2.36 billion for the FY2011/2012 on revenues of JPY1.2 trillion.

August 2012: Japan Airlines (JAL)(JAS) has reported a 1st-quarter net income of +JPY26.9 billion/+$343.5 million, more than 2x- the net income of +JPY12.7 billion in the year-ago quarter. (JAL)/(JAS) said strong yen and good demand lifted its balance sheet. (JAL)/(JAS)’s 1st reporting period for fiscal year 2012 runs from April 1 - June 30.

Consolidated operating revenue increased +12.5% to JPY286.7 billion against a +7.4% increase in operating expenses to JPY255.3 billion.

“Robust demand from outbound-Japan leisure travelers driven by the strong yen yielded a greater influence on overall international demand, which increased +28% year-on-year, measured by revenue passenger kilometers (RPKs). The load factor was consequently pushed up by +12.3% points to 73.4% LF.”

First-quarter revenue for (JAL)/(JAS)’s consolidated international passenger operations increased +21.6% to JPY95.9 billion year-over-year.

On the domestic side, post-earthquake and tsunami recovery saw traffic (RPK)s rise +18% compared to the year-ago period. Load factor was 59.6% LF, up +3.5% points. Cargo was described as stagnant, which (JAL)/(JAS) attributed to problems in Europe.

Looking forward, (JAL)/(JAS) said there was no need to revise its full-year profit figures, which remain at +JPY130 billion.

Japan Airlines (JAL)/(JAS) has tentatively set the price for its initial public offering (IPO), scheduled for September 19, at between ¥3,500/$44.5 and ¥3,790 per share, according to the multiple reports from Tokyo. With 175 shares to be sold, (JAL)/(JAS) believes it can raise as much as ¥663 billion/$8.4 billion.

The (IPO) will enable the Enterprise Turnaround Initiative Corporation of Japan, the government-backed entity set up in January 2010 to bail out (JAL)/(JAS) and guide it through a bankruptcy restructuring, to end a more than two-year period of owing the carrier.

(JAL)/(JAS) was delisted from the Tokyo Stock Exchange shortly after entering bankruptcy restructuring.

Japan Airlines (JAL)/(JAS) and All Nippon Airways (ANA) are battling to get rights for new domestic services at Tokyo Haneda airport (HND). (HND)’s domestic arrival and departure slots will increase from 320,000 to 340,000 from the end of March 2013.

(ANA) holds 37.4% of (HND)’s domestic slots and (JAL)/(JAS) holds 41.3%.

(ANA) believes (JAL)/(JAS), which declared bankruptcy in 2010, should not get any slots. “It’s a failed company, which should be properly reflected in the decision” an (ANA) spokesman said.

(JAL)/(JAS) argues that during its restructuring, it withdrew from destinations that were also serviced by alternative carriers. Last month, (JAL) announced it was pressing on with plans to return to the stock market.

“From the point of view of encouraging inbound Japan travel, it is important to improve the connectivity between international-domestic travels. In the past, we saw a notable increase in visitors from Taipei to Matsuyama via Haneda when we started the flights, and in the same way, we want to bring the growth of Asia to more local regions and contribute to the hub functions of Haneda,” a (JAL)/(JAS) spokesperson added.

Japan’s Land, Infrastructure, Transport & Tourism Ministry, which is overseeing the process, has said it will announce a decision on the new slots in the fall.

April 2013: Japan’s Ministry of Land, Infrastructure, Transport & Tourism has approved Boeing (TBC)’s fix for the 787’s battery system. The clearance issued April 26th follows in the footsteps of the (FAA)’s approval and paves the way for All Nippon Airways (ANA) and Japan Airlines (JAL)/(JAS), which operated 24 of the 50 787s in service worldwide when the 787 Dreamliner fleet was grounded January 16, to resume commercial service. The airlines are not expected to restart commercial flights immediately; both carriers said all of their 787s will be test flown 1st and all pilots (FC) operating the 787s will have to gain renewed approval to fly 787s. (JAL)/(JAS) indicated it plans to begin commercial flights again by June.

Aviation Partners Boeing (APB) announced that Japan Airlines (JAL)/(JAS) has ordered 6 blended winglet systems (with options) for its 767-300ERs.

June 2013: Japan Airlines (JAL)/(JAS) wants to start replacing "around 40" of its older 777 airplanes from 2019, Chairman Masaru Onishi has said. Currently, (JAL)/(JAS) is considering the A350-1000, as well as the 787-10X and 777-9X. Onishi said the airline could come to a decision "soon" should the right terms be arrived at, but that (JAL)/(JAS) was not in any hurry. As with fellow Japanese carrier, (ANA) - All Nippon Airways, the prospect of a deal with Airbus Industrie (EDS) marks a possible departure from the carriers' historic allegiance to Boeing (TBC). (JAL)'s 777 fleet consists of 26 777-200s, 7 777-300s and 13 777-300ERs whose overall average age is 10.5 years.

July 2013: SEE NEW UPDATE - - "JAS-2013-07-A/B/C /D/E/F/G/H."

August 2013: (AJW) Aviation will provide spares support across Japan Airlines (JAL)/(JAS)’s fleet and subsidiary airlines. (AJW) will support (JAL)/(JAS)’s Boeing (TBC) airplanes from its Singapore stocks, which have extensive Boeing (TBC) component inventories. AJ Walter (AJW) added that it is "working closely" with (JAL)/(JAS)'s Engineering department to accommodate Japanese Civil Aviation Bureau regulations in its operations.

October 2013: Japan Airlines (JAL)/(JAS) has reported a 1st-half net income of +¥81.9 billion/+$834 million for the period ended September 30, down -17.8% from a year ago.

Japan Airlines (JAL)/(JAS) said it will “formally seek a rational explanation and correction” of slot allocations at Tokyo Haneda Airport announced by Japan’s Ministry of Land, Infrastructure, Transport & Tourism (MLIT).

(JAL)/(JAS) said it had been notified by the (MLIT) that, of 16 additional slots available for Japanese airlines at the airport, it had been awarded just 5, with the remaining 11 allocated to All Nippon Airways (ANA).

(JAL)/(JAS) said it had requested “an equal allocation based on the idea that equal distribution among the two airlines operating international flights would lead to the maximization of both convenience for passengers and benefit to the national interest.” However, it said the (MLIT) notification “diverged greatly from an even allocation.” “In addition,” (JAL)/(JAS) said, “the new criteria pertained to the establishment of a given new route which set the limitation for free business activities, and we sincerely regret that we cannot accept this.”

(ANA) had lobbied for a lion’s share of the slot allocation, pointing out that (JAL)/(JAS) had received a massive government bailout to save it from bankruptcy in 2010, putting (ANA) at a competitive disadvantage.

But (JAL)/(JAS) insisted that passenger and national interests should be the deciding factors. “Decisions regarding the allocation of national assets such as departure and arrival slots were not made from the standpoint of maximization of passenger convenience and the national interest. Additionally, no rational reason was given by (MLIT) as to how the current allocation would bring about such benefits,” (JAL)/(JAS) said.

(JAL)/(JAS) said it had received clarification that the decision was based on whether or not the criteria pertained to the establishment of a given new route. But it said: “It has not been specifically explained why new criteria have been abruptly established, why it is that routes established at Tokyo [Haneda] Airport are to be regarded as ‘new,’ or how they might impede or distort an appropriate competitive environment.”

(JAL)/(JAS) reserves the right to sue the Japanese government for favoring rival (ANA) Holdings by allocating it more landing slots, raising the prospect of an unprecedented battle that could batter the nation’s airline industry. Asking a court to force the government to review its recent allocation would be a rare step for a Japanese company, especially one that once enjoyed cozy ties to politicians and regulators but which has fallen out of favor of Prime Minister Shinzo Abe’s one-year-old administration. “It’s one of the steps we might take in the future,” said Yoshiharu Ueki said, when asked if legal action was one possibility.

Ueki said his company had asked the government to give a satisfactory explanation for the landing-rights handout, which saw (ANA) receive more than twice as many of the prized international slots at Haneda airport than (JAL).

Japan Airlines (JAL)/(JAS) has signed a purchase agreement for 31 A350 XWBs (18 A350-900s and 13 A350-1000s), plus options for a further 25.

SEE ATTACHED - - "JAS-A350-900 A350-1000 XWB 2013-10 ORDERS."

It is also the 1st order Airbus (EDS) has received from Japan for the A350 XWB, confirming its continuing success with world leading airlines across the globe. (JAL)/(JAS) and Airbus (EDS) aim for entry into service (EIS) from 2019, with (JAL)/(JAS)’s A350 XWBs gradually replacing its ageing fleet approximately over a 6 year period.

“We will utilize the A350 XWB to maximum, which offers high level of operational efficiency and product competitiveness, while positively catering to new business opportunities after slots at airports in Tokyo are increased,” said Yoshiharu Ueki President of Japan Airlines (JAL)/(JAS). “In addition to improving profitability with advanced airplanes, we always aim to deliver unparalleled services to customers with the latest cabin and steady expansion of our route network.”

In a typical 3-class layout the A350-900 comfortably seats >300 passengers on routes as long as 8,100 nm. The A350-1000 is the largest member of the A350 XWB Family, seating 350 passengers on even longer missions up to 8,400 nm. All A350 XWB models are equipped with the new Rolls-Royce (RRC) (Trent XWB) engines.

>70% of the A350 XWB’s weight-efficient airframe is made from advanced materials combining composites (53%), titanium and advanced aluminium alloys. In addition to innovative materials, the A350 XWB brings together the very latest in aerodynamics, design and advanced technologies and provides significant improvement in fuel efficiency compared with competing models.

To date, the A350 XWB (MSN1) has completed around 300 flight test hours out of the campaign’s total 2,500 hours, which are to be achieved by 5 flight test A350’s over the next 12 months. Entry into commercial service of the A350-900 is scheduled for the 2nd half of 2014. With this latest commitment, Airbus (EDS) has recorded >750 firm orders for the A350 XWB from 38 customers worldwide.

This is not (JAL)/(JAS)’s first ever order for Airbus airplanes. Before the merger by Japan Airlines (JAL) and Japan Air Systems (JAS), (JAS) ordered Airbus (EDS) airplanes.


November 2013: (BAE) Systems will provide maintenance for Japan Airlines (JAL)/(JAS) for three years. (BAE) will provide repairs, spares and modifications for electronic systems on (JAL)/(JAS)’s 737-800s, 767s and 777s.

January 2014: Japan Airlines (JAL)/(JAS) reported net income of +JPY123.5 billion/+$1.21 billion for the nine months to December 31, 2013, down -17.1% from +JPY140.6 billion reported for the same period
last year.

April 2014: Japan Airlines (JAL)/(JAS) reported net income of +¥166.2 billion/+$1.62 billion for the financial year to March 31, 2014, down -5.4% from net income of +¥171.6 billion year-over-year.

(JAL)/(JAS) said the profit drop was due to “a severe operating environment,” with the weakness of the Japanese yen pushing costs (especially for fuel) higher, increasing competition in both domestic and international markets, and the residual effects of the global economic downturn continuing to exert downward pressure on its domestic business.

Operating revenue for the 12 months was up +5.7% to ¥1.31 trillion year-over-year, but operating expenses increased +9.5% to ¥1.14 trillion, resulting in a -14.6% decline in operating income to ¥166.7 billion.

The number of passengers carried during the year was up +3.9% to nearly 39 million from 37.5 million in the previous financial year. Load factor was 71% LF, up +0.7 point. Traffic (RPK)s were 59.1 billion, up +3.5%, and capacity (ASK)s were 83.3 billion, up +2.6% year-over-year.

The (JAL) Group said it “faces intensifying competition at the Tokyo metropolitan airports as a result of the dramatic increase of international flight slots at Haneda Airport” and the fact that “fewer-than-expected” of those slots were allocated to (JAL)/(JAS).

In addition, (JAL)/(JAS) said “the escalation of fuel costs due to the weak yen may prevail and competition may intensify in both international and domestic market.”

(JAL)/(JAS) president Yoshiharu Ueki said the airline group would not be revising its operating income forecast of ¥140 billion for the financial year to March 31, 2015 cited in its "Rolling Plan 2014" that was announced last month. This is a -¥26.7 billion decrease compared to the financial year ended March 31, 2014 and based on an expected +¥67.5 billion year-on-year increase in operating expenses.

Ueki said: “We will continue to do our best to achieve the targets we set for fiscal year 2014 and prepare ourselves to realize growth from fiscal year 2015.”

Japan Airlines (JAL)/(JAS) (which is revamping in-flight products and services in all classes across all domestic and international operations as part of its "New Sky" project) will launch its first domestic service featuring the "JAL SKY NEXT" configuration in late May.

The project (which will launch on flights between Tokyo Haneda and Fukuoka from May 28) includes an updated cabin interior with leather seats and (LED) lighting in all classes and a new in-flight Internet service, "JAL SKY Wi-Fi." The first airplane to be retrofitted with the "JAL SKY NEXT" interior will be a Boeing 777-200 operating on the route 3x-daily.

According to (JAL)/(JAS), 77 airplanes are scheduled to be revamped sequentially and introduced on domestic routes.

(JAL) Express ((IATA) Code: JC, based at Osaka Itami) (JEX) is to be dissolved following the recent announcement of a merger with parent, (JAL)/(JAS) - Japan Airlines (JL, Tokyo Haneda). In a press statement, (JAL)/(JAS) said the decision to absorb its domestic subsidiary was taken at a recent group board meeting.

(JAL)/(JAS) says the move will help stabilize its domestic business by better matching capacity to demand. (JAL) Express (JEX) operates forty-one 737-800s. The merger is set for completion on October 1 of this year.

June 2014: Gogo has received certification from the (FAA) and the Japanese Civil Aviation Bureau (JCAB) to begin installing a Ku-band satellite-based, in-flight connectivity service across Japanese Airlines' (JAL)/(JAS) fleet of Boeing 737-800s. This is the 4th and final certification Gogo has received for (JAL)/(JAS)'s connectivity service, enabling the connected airplane company to reply its solution across (JAL)/(JAS)'s entire commercial airplane fleet.

JAL signed an agreement with Gogo in October 2013 to add the service across its fleet of 77 total commercial airplanes. Along with the connectivity service, (JAL)/(JAS) is also adding Gogo Vision, a wireless In-Flight Entertainment (IFE) service to its fleet.

July 2014: Japan Airlines (JAL)/(JAS) has reached an agreement with Amadeus for its full Altéa Suite of Information Technology (IT) solutions.

August 2014: The latest round of route announcements by Japan’s major airlines includes the notable return of a domestic trunk service that was previously squeezed out by competition from high-speed rail.

All Nippon Airways (ANA) and Japan Airlines (JAL)/(JAS) are both boosting flights from Tokyo’s Haneda Airport, although (JAL)/(JAS) also cut flights from elsewhere in its network. Most of the changes will be effective from October 26, and will apply to their schedules for the second half of the fiscal year.

(ANA) is adding a new route from Tokyo Haneda to Nagoya’s Chubu Centrair Airport using Boeing 737-800s. (ANA) last operated this route in 1982, although at that time, it used Komaki Airport in Nagoya since Centrair had not yet been built.

The flight was suspended due to the challenge of the Shinkansen bullet trains, which can travel between Nagoya and Tokyo in 1 hour 40 minutes. Many relatively short domestic routes have come under pressure from the Shinkansen trains, as they offer extremely high frequency on trunk lines such as Tokyo - Nagoya - Osaka.

The reason the flights are being resumed on this route is not to compete with the trains for commuter traffic, but to offer convenient connections to international flights at Haneda. Thanks to recent expansion at Haneda, (ANA) has increased its international services at what used to be a domestic airport. (ANA) already operates flights from Nagoya to Tokyo Narita Airport, which is still the major international airport in Tokyo.

As well as the new Nagoya service, (ANA) has added 3 daily frequencies to existing domestic routes from Haneda. It has also added 3x-daily frequencies to routes from Fukuoka. On the international side, (ANA) is changing airplane types on a number of routes, and also cut back its flights from Narita to Chengdu, China from daily to 4x-weekly.

(JAL)/(JAS), meanwhile, added two daily frequencies to domestic routes from Haneda. It also cut 4x-daily from its Fukuoka network.

Another notable change is its suspension of flights between Narita and Okinawa’s Naha Airport. This is one of the routes currently served by both (JAS) and its low-cost joint venture (JV) Jetstar Japan (JJP). Code share flights on the Jetstar Japan (JJP) service will still be offered to passengers from Naha connecting to (JAL) international flights at Narita.

(JAS) will continue to offer multiple daily flights between Haneda and Naha, operated by mainline airplanes as well as its (JAL) Express (JEX) and Japan Transocean Air (SWL) subsidiaries.

Japan Airlines (JAL)/(JAS) has ordered both Embraer E-Jets and the Mitsubishi Regional Jet (MRJ) as it prepares to revitalize its J-AIR regional subsidiary’s fleet.

(JAL)/(JAS) announced Thursday it had signed a firm order with Embraer (EMB) for 15 E170s and E190s, worth $677 million at list prices; the split between the two models was not revealed. It also placed options for a further 12 E-Jet family airplanes. Seating capacity of the E170 is normally 78Y, while the E190 typically carries 104Y passengers.

The E-Jets are powered by (GE) Aviation (GEC)’s (CF34) engines.

Osaka-based, J-AIR already has 15 E170s, which have been “highly well received” by passengers and nine Bombardier CRJ200s. The new EMB-Jets will begin delivery from 2015 as the CRJ200s are retired and will be used to expand the regional route network.

(JAL)/(JAS) said “other propeller jets” would also be retired from 2015. The Group operates Bombardier Q100s, Q300s and Q400s plus the Saab 340Bs in its Japan Air Commuter subsidiary.

Simultaneously, (JAL)/(JAS) announced it had signed a letter of intent (LOI) with Mitsubishi for 32 MRJs. Again, the split between the 78Y-seat MRJ70 and the 92Y-seat MRJ90 was not revealed.

The MRJs will start to arrive from 2021 and (JAL)/(JAS) “intends to use it as the choice replacement for all other current regional jets including the E170 by 2021,” becoming J-AIR’s next-generation regional jet on domestic routes.

(JAL)/(JAS) added, “As a network carrier that also operates regional jet airplanes, the (JAL) Group will not only be purchasing the MRJ, but also aims to provide know-how from the operator’s perspective in the development of this airplane. We hope to support the birth of a Japanese passenger jet which we can boast about to the world, and thereby contribute to the development of the Japanese economy.”

October 2014: Canadian flight training specialist (CAE) has signed a deal with Japan Airlines (JAL)/(JAS) to train its pilots (FC) in Tokyo, giving the company presence in a new and potentially fruitful Asia-Pacific market.

Pending regulatory approval, (JAL)/(JAS) will move its entire flight crew (FC)-training operation to a facility jointly owned by (JAL)/(JAS) and (CAE) in April 2015. Initially, the new operation will be based at (JAL)’s own Tokyo training facility.

Since its bankruptcy four years ago, (JAL) has taken steps to minimize all its non-core activities (cargo, catering, and now flight training) to minimize operational overhead.

The 12-flight simulator center will provide ab initio and multi-crew pilot license training, as well as recurrent-type training to other airlines and (JAL)/(JAS) employees.

(CAE) said the new center will offer training services to third-party customers training with (CAE) in Northeast Asia outside China. The company’s training center at Zhuhai was set up as another joint venture (JV) with China Southern Airlines (GUN) in 2002.

The new agreement will offer (CAE) a convenient springboard into the expanding Japanese market, which has seen pilot (FC) shortages affect airline operations during the past year.

The new center will complement (CAE) operations in Seoul, Hong Kong, and Zhuhai to help address the boom in Northeast Asian pilot (FC) and aircrew demand.

(CAE) also has training centers in Singapore, Malaysia, the Philippines, India, and Australia.

November 2014: News Item A-1: Japan Airlines (JAL)/(JAS) said that Skymark Airlines (SKM) had sought talks to discuss a possible business tie-up that would put one of the country’s few remaining budget carriers under the wing of a bigger rival. “We received the request from Skymark Airlines (SKM) on the possible cooperation,” a spokesman for (JAL) said.

“We will start to discuss some possible cooperation but at the current stage, there is no decided agreement,” he added.

(SKM) would code share some flights with (JAL)/(JAS) and cooperate in sales, the "Nikkei" newspaper reported, although it said the tie-up was unlikely to involve a capital injection from (JAL)/(JAS).

Difficulty for new budget carriers in winning landing rights on lucrative routes has meant that air fares in Japan have not been subject to the same tough price competition as in many other major aviation markets.

(SKM), which began flying in 1998, had been a rare case of a small carrier in Japan able to thrive without becoming an affiliate of either (JAL)/(JAS) or Japan’s other big carrier, (ANA) Holdings.

Of the nine low-cost carriers flying within Japan, six (including Peach Aviation (PCA), Jetstar Japan (JJP) and Air Do (HIA) – are controlled by or affiliated with the two big carriers.

News Item A-2: Japan Airlines (JAL)/(JAS) announced that it will introduce fully revamped Boeing 767-300ER airplanes on its domestic Tokyo (Haneda) - Osaka (Itami) route starting December 8, 2014. The retrofitted 767s have also been configured to offer First (F) Class in addition to Business (J) Class and Economy (Y) Class, which both are fitted with new seats SEE ATTACHED - - "JAS-767-300ER CONFIGURATION - 2014-11."

Under the theme of "Embrace new Challenges", (JAL)/(JAS) is striving to introduce more innovative products and services to its customers.

January 2015: News Item A-1: Japan Airlines (JAL)/(JAS) reported net income of +JPY119.6 billion/+$1 billion for the nine months ended December 31, 2014, down -3.1% from +JPY123.5 billion in the same period in the previous financial year.

(JAL)/(JAS) said that, although the Japanese economy was recovering slowly, consumer spending was weaker and the Japanese yen was sharply down against the dollar.

Operating revenues for the period were up +3.3% year-on-year, breaking through the JPY1 trillion mark, with operating expenses up +3.7% to JPY884.1 billion. Operating income for the period was up +0.5% to +JPY138.2 billion.

The number of passengers carried during the nine-month period was up +0.8% to 29.8 million year-over-year. (RPK)s were up +1.56% to 45.4 billion and (ASK)s were up marginally to 63.4 billion from 63.3 billion during the previous nine-month period. Revenue passenger load factor was up +0.9% points to 71.5% LF.

(JAL)/(JAS) said that, largely as a result of the fall in fuel prices, it was revising its full-year net income forecast upwards to +JPY139 billion. The forecast at the end of the previous financial year was +JPY115 billion, and this was revised up to +JPY135 billion at the end of the first half. Operating revenues have been revised down from JPY1.35 trillion at the end of the previous financial year to JPY1.342 trillion. This is, however, an improvement on the interim first-half forecast of JPY1.34 trillion.

(JAL)/(JAS) said: “Consolidated revenue for the full fiscal year is expected to increase by +2 billion yen from the previous forecast, while consolidated operating expenses are expected to decline by -7 billion yen owing to falling aviation fuel prices and rigorous cost reduction initiatives continuing into the second half of the fiscal year, and so on. Consolidated operating profit, reflecting the aforementioned factors is seen to increase by +9 billion yen from the previous forecast.”

The revised forecast, (JAL)/(JAS) said, was “due to an expected 9 billion yen increase in full-year consolidated ordinary profit based on an increase in full-year consolidated operating profit and an expected +4 billion yen increase in full-year consolidated net income.”

News Item A-2: Japan Airlines (JAL)/(JAS) has finalized an order for 32 Mitsubishi Regional Jets (MRJs), which will replace some of its regional fleet from 2021.

Last August, (JAL)/(JAS) signed a letter of intent (LOI) with Mitsubishi (MRJ) for 32 MRJs, although the split between the 78-seat MRJ70 and the 92-seat MRJ90 was not disclosed.

In a statement issued January 28th, (JAL)/(JAS) and Mitsubishi (MRJ) said the (LOI) was converted into a firm order on January 28. Deliveries will begin in 2021, although the split between variants remains unconfirmed.

The 32 MRJs will be operated by (JAL) regional subsidiary, J-AIR on domestic routes. (JAL) said the (MRJ) will form a key part of its regional fleet, as it pursues its “steady network expansion.” The Japanese carrier added that it selected the (MRJ) based on its performance and in-service operational support.

To date, the (MRJ) program has accumulated 223 firm orders, 160 options and 24 purchase rights, including this latest order from (JAL).

At the same time as announcing the (MRJ) letter of intent (LOI) last August, (JAL) ordered 15 E170s and E190s, plus 12 options. Osaka-based J-AIR already has 15 E170s and nine Bombardier CRJ200s. The new E-Jets will arrive from 2015, as the CRJ200s are retired.

News Item A-3: Boeing (TBC) delivered a new 787-8 Dreamliner to Japan Airlines (JAL)/(JAS).

News Item A-4: 767-346ER (40371, JA659J), re-painted in "Suica Penguin Jet" colors.

Boeing (TBC) delivered a new 787-8 Dreamliner (34853, JA839J) to Japan Airlines (JAL)/(JAS).

February 2015: Tokyo’s Narita International Airport plans to open its dedicated low-cost carrier (LCC) terminal in early April. The 66,000 sq m Terminal 3 has five contact stands for narrow body airplanes and two contact stands for wide body airplanes. It will increase capacity by +7.5 million passengers per year, Narita deputy Vice Chairman Cargo, Fumio Gunji said.

“The total investment for T3 is around $130 million “Narita deputy VP Aviation Marketing, Koichi Okawara said.

Currently, 13 low cost carriers (LCC) (four of them based in Japan) operate out of Narita during the current winter schedule, creating about 21.5% market share of the total.

March 2015: Japan Airlines (JAL)/(JAS) is expanding its In-Flight Connectivity (IFC) services on both international and domestic routes. Beginning March 3, (JAL)/(JAS) is offering its (JAL) Sky Wi-Fi services on more long-haul routes in Europe, North America and Asia aboard its Boeing 767-300ERs and 787-8 airplanes.

Additionally, beginning in April, (JAL)/(JAS) will provide customers with the additional movie and TV In-Flight Entertainment (IFE) content available on the (JAL)/(JAS)’s Boeing 787s. (JAL)/(JAS) is also bolstering domestic offerings as well, increasing the Wi-Fi video service to 10 programs that are available through Personal Electronic Devices (PEDs).

May 2015: 777-246 (27656, JA771J), purchased off lease and 787-8 (34854, JA-842J) delivery.

June 2015: News Item A-1: Japan Airlines (JAL)(JAS) is due to begin operating its first Boeing 787-9 this month, as (JAL)/(JAS) and its rival All Nippon Airways (ANA) continue to build their 787 fleets.

July 2015: News Item A-1: The Japan Airlines (JAL) Group achieved a net profit of +¥32.6 billion/+$262.1 million) for its fiscal 1st quarter, more than doubled from a net income of +¥14.7 billion for the previous year. (JAL)/(JAS) cited strong international demand for the increased profit.

(JAL)/(JAS) said demand from inbound travelers to Japan remained high, particularly on Chinese and Southeast Asian routes. Outbound premium demand was steady. The depreciation of the Japanese yen is providing cost headwinds for (JAL)/(JAS), but it is also helping increase foreign tourist numbers.

With (JAL)/(JAS)’s international capacity rising +2.4% in the quarter, traffic for this period was up nearly +9%. This raised international load factor +4.6 points to 77.9% LF, with revenues from this sector up +2.1%.

In the domestic market, (JAL)/(JAS) cut capacity by -1% year-on-year, with traffic remaining essentially flat. This raised its domestic load factor by +0.7 point to 63.1% LF, and revenue by +3.9%.

Cargo volumes strengthened in both domestic and international and markets. (JAL)/(JAS) also cited a “moderate” growth rate in the Japanese economy as another positive factor, along with consumer spending showing signs of improvement.

(JAL)/(JAS) has left its full-year profit forecast unchanged since its last update in April. It expects a +¥144 billion net profit, although this would be down slightly from the +¥149 billion it earned in the previous fiscal year.

News Item A-2: Japan Airlines (JAL)/(JAS) on July 1st announced the launch of "JAL Countdown" app for Android WearTM (**). The (JAL)/(JAS) Countdown app allows users to track real-time domestic flight status and proceed through boarding gates more conveniently and smoothly. This app will be available from Google PlayTM (***) starting July 1, 2015, and will deliver various information to airline devices in a timely manner. See attached - - "JAS-2015-07 - Andrid WearTM Countdown app.jpg).

(**): An AndroidTM platform for wearable devices provided by GoogleTM

(***): A service provided by Google to deliver digital contents (apps, movies, music, books) to Android devices.

Customers will be able to track real-time flight status, check details on boarding gates, boarding times, and receive alerts counting down to the flight's departure (from a day ahead down to the hours, minutes and beyond).

The app also supports 2-dimensional bar-code "touch and go" systems so that customers can move through security checkpoints or enter boarding gates and lounges using Android Wear.

(JAL)/(JAS) will also launch an original Watch Face from (JAL), featuring aircraft motifs. The clock's 2nd hand is designed with an airplane, counting down to the flight so that customers can shop and dine at ease before boarding.

(JAL)/(JAS) will continue to embrace new challenges of enhancing services for its customers to make boarding faster, smoother, and more convenient.

News Item A-3: Boeing (TBC) and the Japanese aviation industry stakeholders have charted a course to develop sustainable aviation bio-fuel for flights during the 2020 Olympic & Para-Olympic Games in Tokyo, when millions of people are expected to visit Japan. The Initiatives for Next Generation Aviation Fuels (INAF) (a consortium of 46 organizations including Boeing (TBC), All Nippon Airways (ANA), (JAL)/(JSA), Nippon Cargo Airlines (NCA), Japan's government, and the University of Tokyo) laid out a 5-year road map to develop bio-fuel by 2020 as a way to reduce aviation’s environmental footprint. Using sustainably produced bio-fuel reduces life cycle carbon dioxide emissions by -50% to -80% compared to conventional petroleum fuel, according to the USA Department of Energy.

August 2015: News Item A-14: "Top 10 Premium Economy Class 2015" by AIRWAYS publication placed Japan Airlines Domestic (JAS) in 10th place - - see attached "JAS-2015-08 - Top 10 Premium Economy Class 2015 - 10th.jpg."

November 2015: News Item A-1: "Japan Airlines (1H) Net Profit Up +30%."

Japan Airlines (JAL)/(JAS) reported a net profit of +¥103.3 billion/+$856.9 million for the six months through September 30, an increase of almost +30% from the prior year.

News Item A-2: News Item A-2: (JAL)/(JAS)’s return to Dallas/Fort Worth from Tokyo Narita on November 30 is the last piece of route development for some time, with no new routes currently planned.

December 2015: See attached: "JAS-Domestic/Regional/Global Network-2015-12.jpg."

May 2016: J-Air Corporation (J-AIR), the regional offshoot of Japan Airlines (JAL)/(JAS), has introduced its Embraer (EMB) E190 jet in Japan. The inaugural revenue flight took place May 9 between Osaka-Itami Airport and Kagoshima.

August 2016: 767-346 (27313, JA8399), assigned (N573UA), 767-346ER (33849, JA613J), purchased off leasing. 787-9 (38138, JA865J) delivery.

787-8 (38136, JA844J) and 787-9 (34858, JA864J) deliveries.

February 2017: 787-9 (34843, JA867A), delivery.

July 2017: 787-9 (35424, JA869J) delivery.

April 2018: News Item A-1: The Japan Airlines Group’s net profit dropped -17.5% in the fiscal year ending March 31, although it saw a +2.5% rise in its operating profit for the same period.

Despite the decline, (JAL)/(JAS) still recorded a net profit of +¥135.4 billion/+$1.27 billion for the fiscal year. The drop was mainly the result of deferred taxes from the previous year. Excluding special items, the operating profit increased year-on-year (YOY) to ¥174.5 billion.

Group revenue increased +7.3% to ¥1.4 trillion, with expenses up +8.1% driven by higher fuel prices. Demand remained strong in domestic and international markets because of “moderate economic recovery trends.”

International passenger revenue rose +11.5% (YOY) to ¥462.9 billion. International traffic increased +3.4% on a +2.4% capacity gain, resulting in load factor rising +0.8 point to a record 81% LF.

Domestic revenue was up +3.9% to ¥518.2 billion, although revenue per passenger declined, thanks to strong competition from other airlines. Domestic traffic rose +4.5%, with capacity up +0.8%. Load factor increased +2.5 points to 71.8% LF. The (YOY) traffic gain was partly because of demand recovery following Japan’s Kumamoto earthquakes in April 2016.

Revenue from international cargo operations increased +29.3%, and was up +0.8% for domestic cargo.

(JAL)/(JAS), the Japan flag carrier expects its net profit to slip to ¥110 billion in the fiscal year through March 2019. It forecasts revenue to improve by +5.2% to ¥1.45 trillion for this period, although expenses will increase +6.6%. Operating profit is estimated at ¥167 billion.

May 2018: May 2018: "Establishment of a New International Low-Cost Carrier (LCC) Business" by "China Aviation Daily" May 14, 2018.

Japan Airlines (JAL) announced the decision to establish a new low-cost carrier (LCC) business for the international market. As described in the (FY) 2017 to 2020, (JAL) Group Medium Term Management Plan, the company looks to develop and cultivate new business opportunities. The new (LCC) business will specifically feature international routes with medium to long-haul flights and will aim to provide customers with new options when traveling to/from Japan.

The company will be a consolidated subsidiary of the (JAL) Group and plans to operate flights from Narita International Airport to select destinations in Asia, Europe, and the Americas. In the 1st stages of its establishment, (JAL)/(JAS) will operate 2 Boeing 787-8 airplanes and is targeting to launch commercial flights from the summer of 2020 when Narita Airport plans to complete enhancements to its facilities.

To date, (JAL)/(JAS) has remained committed to refine its own full service carrier model while making key investments into Jetstar Japan. When (JAL)/(JAS) establishes the new (LCC) business, the company aims to create new demand, working along with the successful services provided by Jetstar Japan, which features domestic and short-haul international flights. Through these actions, the company will take on the challenge to deliver and meet the needs of diversified customer groups around the world.

In alignment with the company's Medium Term Management Plan, the (LCC) business is part of (JAL)/(JAS)'s '10 Year Grand Design' strategy where the company will accelerate growth through innovation, while contributing toward the country's target to welcome new inbound visitors in the next 3 years and beyond.

Contributed by Japan Airlines.

September 2018: Japan Airlines (JAL) announced it will offer nonstop Seattle to Tokyo service starting in March 2019. Delta (DAL) and All Nippon Airways (ANA) of Japan already serve that route.

The new daily service on a Boeing 787-8 will leave Narita airport each day at 6 pm and, because of the time shift, arrive at at 11 am in Seattle , the same day after a 9-hour flight. Flights from Seattle will leave at 2.20 pm and arrive in Tokyo at 4:30 pm the next day.

As a partner of Alaska Airlines (ASA), (JAL)'s move will help strengthen (ASA)'s global connection network.

February 2019: While Japan Airlines (JAL)/(JAS) is looking to keep capacity mostly flat until 2020, the Oneworld (ONW) carrier is not standing still. In 2019, (JAL)/(JAS) is introducing Airbus A350s and Boeing 787s on domestic routes, with the 1st of 18 A350-900s scheduled to arrive in June (and 13 A350-1000s also on order). (JAL)/(JAS) also will start receiving the remaining 10 787s it has on order from April, having already integrated 36 787 Dreamliners into its fleet. 4 of those 787s will be 787-8s configured for domestic services.

April 2019: "(JAL)/(JAS) Boosts Fiscal Year Profit on Inbound Demand Growth" by Adrian Schofield (ATW) Plus (adrian.schofield@informa.com), April 29, 2019.

Japan Airlines (JAL)/(JAS) achieved healthy growth in net profits for its fiscal year through March 31, although it is projected to decline in the current fiscal year. (JAL)/(JAS) reported net profits of +JPY150.8 billion/+$1.3 billion for the 2018 fiscal year, representing a +11.4% year-on-year increase. The gain was partly because of deferred income tax of JPY32.1 billion.

(JAL)/(JAS) is sticking to forecasts it made in February for its 2019 fiscal year, which will run through March 2020. For this period, the company expects net profit to drop back to +JPY114 billion, because of tax rate hikes and the deferred income tax from the previous year. Without these effects, the profit would be about the same.

(JAL), the Japanese flag carrier experienced “steady growth” in demand for the 2018 fiscal year. Strong freight and passenger demand in the 1st half were tempered by “slightly weaker” demand in the 2nd half. Fuel prices were up in the 1st half, before dropping in the 2nd half, and were increasing again from January 2019.

Operating revenue increased +7.5% to JPY1.5 trillion, and operating costs were up +8.5% to JPY1.3 trillion. This saw operating profit climb by +0.9% to JPY176.1 billion.

For the international operation, inbound demand was once again strong based on overall visitor numbers to Japan rising to record levels. Outbound demand was described as steady. (JAL)’s international capacity rose by +6% year-on-year, with passenger revenue up +14.6%.

The domestic sector was affected by flight cancellations related to typhoon damage at Osaka Kansai International Airport, and an earthquake in Hokkaido. However, demand remained robust, and domestic capacity increased by +1.1% with traffic rising +2.2%. (JAL)/(JAS) projects overall +2.5% capacity growth in the fiscal year through March 2020, with international up +2.5% and domestic up +2.6%.

June 2019: News Item A-1: Japan Airlines (JAL) is embarking on a new phase of fleet renewal this year as it prepares to introduce Airbus A350s and Boeing 787s on domestic routes using (JAS). (JAL) is set to take delivery of its 1st A350-900 this month, with an operational debut scheduled for September 1. This will be the 1st wide body delivery for (JAL) in the current fiscal year, which began April 1. (JAL)’s incoming A350-900s and A350-1000s are intended to begin the replacement of its 777s.


Click below for photos:
JAS-737-846 JA301J
JAS-787 - 2013-07
JAS-787 - 2013-10
JAS-787-8 - 2011-12
JAS-A350-900 - 2013-10
JAS-MRJ - 2014-08

June 2019:

23 737-400 (CFM56-3).

27/10 ORDERS 737-700/-800/-900X:

1 737-843 (CFM56-7B) (40356, JA341J), 2015-07.

29 +1 ORDER 737-846 (CFM56-7B) (2095-35330, JA301J, 2006-11 - SEE PHOTO; 2162-35331, JA302J 2007-01; 2225-35332, JA303J, 2007-04; 2253-35333, JA304J, 2007-05; 2289-35334, JA305J, 2007-06; 2395-35335, JA30GJ, 2007-10; 2450-35336, JA307J, 2007-12; 35337, JA308J, 2008-01; 2510-35339, JA310J, 2008-02; 2522-35338, JA309J, 2008-02; 2571-35340, JA311J, 2008-04; 2584-35341, JA312J, 2008-05; 35342, JA313J; 2701-35343, JA314J, 2008-08; JA315J; 35344, JA315J; 2762-35345, JA316J, 2008-12; 2824-35346, JA317J, 2009-03; 2830-35347, JA318J, 2009-03; 2867-35348, JA319J, 2009-04; JA320J; 35349, JA321J; 35350, JA322J; 3002-35351, JA323J, 2009-09; 3057-35352, JA324J, 2009-10; 3105-35353, JA325J; 3117-35354, JA326J; 3159-35355, JA327J, 2010-02; 3201-35356, JA328J, 2010-03; 3279-35357, JA329J; 35358, JA330J, 2010-06; 35359, JA331J, 2010-06; 39190, JA340J, 2012-01; 40346, JA332J, 2010-08; 40349, JA334J, 2010-12; 40356, JA341J, 2012-01).

10 767-346ER (CF6-80C2) (921-33845, JA609J, 2004-04; 33846, JA610J; 33847, JA611J; 928-33848, JA612J, 2005-03; 935-33849, JA613J, 2005-08; 938-33851, JA614J, 2005-12; 942-33850, JA615J, 2006-05; 954-35813, JA616J, 2007-04; 964-35815, JA618J, 2008-02; 36848, JA651J, 2010-09; 975-37548, JA621J, 2009-03; 977-37549, JA622J, 2009-05; 978-36131, JA623J, 2009-05; 40365, JA653J, 2010-12), XFRD TO (JAL). 30C, 207Y & 5F, 42J, 205Y (JAS) 2014-12 OPS - - SEE - - "JAS-767-300ER CONFIGURATION-2014-12."

1 777-246 (27656, JA771J), 2015-05.

4 777-246ER (446-32893, JA705J, 2003-07; 475-32894, JA707J, 2004-04; 483-32895, JA708J, 2004-06; 33394, JA706J; 33395, JA710J, 2005-07; 533-33396, JA711J, 2005-08). TRANSFERRED TO (JAL).

9 777-289 (PW4084) (134-27639, /98 JA007D; 213-28396, JA010D; 45-27636, /96 JA8977; 27656, /03 JA771J; 32892, /03 JA704J). 12F, 38C, 330Y.

4 +3 ORDERS 777-346 (PW4090) (458-27654, /03 JA751J; 460-27655, /03 JA752J; 812-36128, JA741J, 2009-09; 816-36129, JA742J, 2009-09; 36130, JA743J), 62C, 410Y.

12 +13 ORDERS 787-8 DREAMLINERS (GEnx-1B64) (23-34832, /11 JA822J; 27-34834, /12 JA824J; 33-34835, /12 JA825J; 37-34836, /12 JA826J; 38-34837, /12 JA827J; 70-34838, /12 JA828J; 84-34839, /12 JA829J; 34842, /13 JA834J; 34844, /13 2013-0; 34853, /15 JA839J; 34854, /15 JA-842J; 38136, JA844J, 2016-05), 42C, 144Y.

5 +15/20 ORDERS 787-9 DREAMLINER (34858, JA864J, 2017-02; 35422, JA861J, 1ST 2015-06 IN "(JAL) SKY SUITE 787" COLORS; 35424, JA869J, 2017-07; 38138, JA865J, 2016-08).

0 DC-10-30ER (CF6-50C2) (436-48315; 437-48316; ST (NWA) 2000-04), 41C, 235Y, 295Y.

12 MD-81 (JT8D-217A/C) (1359-49461, /87 JA8260; 2085-53302, /94 JA8557), 8 SOLD TO (MWX), 53297; TO (JEX) 2005-03. 2 AIRPLANES SOLD TO (LSR) 2009-10. 49280; 49281; PARTED OUT FOR (WJE). 163Y.

8 MD-87 (JT8D-217A/C) (1476-49464, /88 JA8278; 1969-53042, /92 373), 134Y.

16 +1 OPTION MD-90-30 (V2525-D5) (2179-53358, /97 JA8070; 2210-53555, /97 JA001D), 2 STORED. 166Y.

0 A300B2K-3C (CF6-50C2R) (082, /80 JA8464; 253, /83 JA8478), 163 SOLD TO (FLM) 2003-05. 082; & 090; RETURNED AIR HAWK 2004-05, SOLD TO (APZ), WET-LEASED TO (SGZ) 2004-05. 256 SOLD TO (FLM) 2004-06. 176 SOLD TO (FLM) 2004-10. 253 PARTED OUT 2005-04. ALL GROUNDED. 298Y.

0 A300B4-2C (CF6-50C2R) (178, /82 JA8560). 089 PARTED OUT 2002-11. 174 PARTED OUT 2002-09. 169 PARTED OUT 2002-12. 110; 151; 194; SOLD TO (FLM) 2004-05. ALL GROUNDED. 298Y.

0 A300B4-622R (PW4158) (602, /91 JA8375; 783, /98 JA8011D), 1 LEASED TO (HAQ). ALL GROUNDED 2010-05. 12C, 280Y.

0 A3004B4-622R (PW4158) (836, JA014D, 2002-08; 837, JA015D, 2002-09; 838, JA016D, 2002-11). ALL GROUNDED 2010-05. 34C, 205Y.



15 ORDERS (2015-02) E170 (CF34), 78Y AND E190 (CF34), 104Y:



4 +10 ORDERS SAAB 340B, 36 PAX (2 TO (HIA) (459).



32 ORDERS (2021-02) MITSUBISHI MRJ70, 78Y & MRJ90, 92Y:




Yuji Akasaka, whose current role is Managing Executive Officer for Engineering & Maintenance, will take over as President on April 1. He will also become a board member in June subject to shareholder and board approval at (JAL)’s general meeting. Akasaka joined (JAL) in 1987, and held a series of senior engineering roles.





























(i-takei@jas.co.jp) (2001-04).







(t-sasaki@jas.co.jp). MAINTENANCE COST PROJECT TEAM LEADER (1999-07).






Top of Page


Since you are not logged in, we can show you only live Airtran Airways data. This page will demonstrate the depth of data we have for every airline. Close and View Airtran Airways ›