After five months of discussions, Japan's two major airline groups have secured ¥85 billion ($765 million) in 'emergency loans' to help them recover from a sharp drop in business following the war in Iraq and the SARS outbreak .
Early in May, All Nippon Airways (ANA) and the Japan Airlines Group (JAL) said they were in talks with the Ministry of Land, Infrastructure and Transport on a major aid package. Talks were held through the Scheduled Airlines Association of Japan and they covered requests for low-interest emergency loans from the state-owned Development Bank of Japan.
Although Japan was not considered a SARS-affected country, ANA and JAL slashed services to many international destinations and only started recovering after the outbreak was contained around the end of June.
At the end of September, the airlines got their aid wish. The Development Bank of Japan provided ANA with ¥15 billion and the JAL Group, which has far more international services than its rival, with ¥70 billion. The carriers say they plan to use the loans to help cover other debts and for general working capital purposes.
Both airline groups suffered deep losses for the quarter to 30 June. ANA recorded a group operating loss of ¥28.6 billion on revenues of ¥259.6 billion. JAL posted a group operating loss of ¥76.9 billion for the three-month period on revenues of ¥398.8 billion.
Source: Airline Business
