Japan's transport minister has thrown the government's support behind Japan Airlines, saying that it will step in to help the beleaguered carrier reform its operations.
"Speculation is growing that the government may not fully support JAL," Seiji Maehara, minister for land, infrastructure, transport and tourism said at a press conference yesterday, according to Japanese newspapers. "We will support JAL so there will be no interfering in its flight operations."
Financial institutions were "excessively worried" about giving loans to JAL, and he reiterated that the carrier's "reconstruction is fully possible". He says JAL's president Haruka Nishimatsu told him at a meeting last week that the airline had enough cash to last until end-2009 and still has "enough reserve energy".
"I hope the company will once again recover its competitiveness and . . . turn itself around so it can contribute to Japan's growth strategy," Maehara adds. "They first need to hand in a tough turnaround plan."
Last week, the government set up a five-member panel to look into the company's restructuring plans. This came after the carrier asked the government for a bail-out. JAL officials are likely to come up with a draft plan by end-October, while the final programme will be issued by end-November after consultations with the government.
JAL is also in talks with several airlines including Delta Air Lines and American Airlines about possible tie-ups.
The carrier posted a net loss of 99 billion yen ($1.1 billion) in the three months to June, primarily because of a decline in travel amid the economic slowdown. For the fiscal year ending in March 2010, JAL has forecast a net loss of 63 billion yen.
Source: Air Transport Intelligence news
