Japan Airlines (JAL) and Japan Air System (JAS) have won regulatory approval for their merger but, as expected, have been forced to give up valuable slots at Tokyo's congested Haneda airport. The carriers announced plans to merge in November, but it was publicly opposed by rival All Nippon Airways (ANA). In March, Japan's Fair Trade Commission (FTC) issued a preliminary ruling on the merger that also opposed it without concessions.
After weeks of negotiations, however, JAL and JAS agreed to give up as many as 12 slots at Haneda, co-operate with new entrants, cut fares and open up airport facilities to smaller carriers in return for the FTC's blessing.
Slots enabling nine rotations to be carried out at Haneda will be given up at the time of integration, the carriers say, while three more slot pairs will be given up in February 2005 if the initial nine "are not sufficient for new entrants". Haneda primarily caters for domestic flights and is by far Asia's busiest airport, handling more than 50 million passengers annually.
JAL and JAS also agreed to make available to new carriers some of their facilities and infrastructure, including airbridges, gate positions and check-in counters, as well as maintenance area space at Haneda, and, if necessary, at other airports. The two also agreed to provide ground handling services such as ramp service, maintenance, flight operations and "any other necessary services required by new entrants, for starting business or business expansion".
The merger effectively represents a take-over by JAL of smaller JAS. With the FTC approval in hand, they aim to establish a joint holding company in October this year and integrate operations from early 2004. The merger will create a carrier with a domestic market share of nearly half, roughly equal to that of ANA, which is still much smaller than JAL in the international market, however.
Source: Airline Business
