Japan Airlines (JAL) is stepping up efforts to cut costs and restructure the company, including the shedding of 2,000 jobs, as the group once again faces a return to losses.
The airline's newly unveiled medium-range plan for the five years through to March 2002 also calls for a reduction in non-core activities and the introduction of performance-based salaries. The plan, which comes as JAL warns of a likely net loss of ´14 billion ($112 million) for its latest 1996/7 financial year, also calls for improvement and expansion of its domestic and regional network.
JA Lplans to reduce its workforce from 19,000 to 17,000 employees over the next financial year to March 1998. This is on top of 3,000 jobs axed since the start of 1994 and does not include a further 400 positions which are to go by March 2000. Much of this will be achieved through natural wastage and hiving off subsidiary operations, says the airline.
Some 800 jobs will be eliminated by consolidating "non-core departments". JAL's international and domestic passenger departments and airport divisions will be merged into passenger services, airport functions and cabin services.
A new pay system will be introduced "-based on achievement rather than the traditional criteria of age and seniority" says JAL. It also wants to overhaul cockpit crew recruitment and operations, including hiring foreign pilots for the planned new domestic subsidiary JAL Express. The use of wet-leased cargo aircraft, such as from Southern Air Transport, will be extended.
Added emphasis will be put on opening new routes and expanding frequencies to the Asia-Pacific region, particularly from Kansai and Nagoya Airports. Planned new destinations include Hanoi and Palau, along with more services to China. JAL hopes to increase capacity at Tokyo's slot-constrained Narita Airport by enlarging its Boeing 747-400 economy class, and through codeshare agreements.
JAL is discussing codeshare arrangements with KLM and South African Airways, along with a possible wider alliance-type relationship with British Airways and its proposed strategic partner American Airlines. Commercial links with other airlines "will continue to be pursued" says JAL.
With its allocation of 12 extra daily slots at Tokyo's domestic Haneda airport JAL plans to step up its operations within Japan, adding new services to Memambetsu and Obihiro, in Hokkaido, and to Kochi in Shikoku. Other plans revolve around the planned start-up in July 1998 of JAL Express, which will initially be equipped with two Boeing 737-400s for use on thin feeder routes, such as from Kyushu into Kansai and Itami. The overall size of JAL's fleet will increase from 142 aircraft to 153 by the end of 1999 with deliveries and deletions.
Source: Flight International
