Dal ae

[Monster Buck]

With all the DC9's we are parking these 90's will go to MSP and the DC9 MSP base will close this summer.

 

[Superpilot92]

With all the DC9's we are parking these 90's will go to MSP and the DC9 MSP base will close this summer.

hmm, i figured MEM would get hammered when the 30's/40's get parked in Oct. Maybe they'll shift the DC9s out of MSP to MEM and MEM will do alot of the DC9 flying. Who knows

 

[ACL65PILOT]

JAL to shrink by 30% / Will halve subsidiaries, retire all jumbo jets under reconstruction plan
Yasuhiro Takizawa / Yomiuri Shimbun Staff Writer

Japan Airlines will be drastically restructured, with 15,700 jobs slashed within itself and its group firms, 27 branch offices abroad closed and its subsidiaries halved to 57, according to the framework plan drawn up under the administration of a state-backed corporate turnaround body.

The ailing airline also plans to cut its sales for the 2012 business year by more than 30 percent from the figure posted in the 2008 business year that ended in March 2009 and turn itself into a corporate group that will make a steady profit.

Over the next three years, the airline will concentrate its corporate resources on businesses deemed essential for keeping its aircraft flying.

Of its 110 subsidiaries, including those managing tourist agencies and hotels, JAL will sell off 24 while liquidating 15 firms and cutting 14 others by integrating them into other entities.

The airline is poised to shift its emphasis to fuel-efficient small- and midsize aircraft, eliminating all its 37 jumbo jets by March 2015.

The reconstruction plan does not go so far as to spell out the exact number of service routes to be abolished. On the other hand, it clearly states that the planned corporate pension benefit cut accepted recently by JAL's employees and its retirees should be reflected in the reconstruction plan.

JAL has projected that it will post sales of 1.36 trillion yen for business year ending in March 2013, more than 30 percent less than the figure posted for the year ending in March 2009.

It projects that it will post an operating profit of 49.7 billion yen in the business year ending in March 2012, and 115.7 billion yen in the business year ending in March 2013.

After ironing out the details of the corporate reconstruction plan with the government and its creditor banks, the airline will file for bankruptcy protection under the Corporate Rehabilitation Law on Tuesday.

On the same day, the Enterprise Turnaround Initiative Corporation of Japan, a state-backed corporate bailout body, is expected to announce its plan to assist the airline.

While implementing the reconstruction plan, the airline's rehabilitation plan will be submitted to the court under the same law in July.

The reconstruction plan will be supplanted by the rehabilitation plan, under which the company will reduce its capital by 100 percent and the bailout body will inject about 300 billion yen of public funds into JAL, after the government approves the latter plan.

High-cost operations face ax

With the restructuring plan, JAL is set to take the ax to its high-cost operating system and improve its profitability by slashing 15,700 of the about 47,000 workers in it and its group firms--7,300 more than the plan drawn up by an expert task force in October--while its projected sales and operating profit for the business year ending in March 2012 are almost the same as those projected by the task force.

JAL had originally planned to cut 6,800 jobs according to the reconstruction plan worked out under the administration of former Prime Minister Taro Aso in September. Even under the plan worked out by the expert task force, the planned job cut was set at just 8,400.

"Compared with such rivals as All Nippon Airways, JAL has an overwhelmingly larger number of personnel at various workplaces," a source knowledgeable about the airline said. With the latest plan, the airline is set to reduce jobs drastically under the supervision of the state-backed bailout body.

Meanwhile, it plans to close 27 branch offices in foreign countries, having reviewed the productivity of its sales and marketing outlets, in light of the ever-increasing sales of airline tickets over the Internet.

But JAL has not spelled out any concrete figures for cutting its unprofitable routes at the moment. In the previous plan, it planned to abolish 50 domestic and international routes, while the task force called for abolishing 45 routes.

JAL plans to switch its business and capital tie-up partner from the current American Airlines to Delta Air Lines of the United States--the world's largest airline--and is now entering the final phase of negotiations on the switchover.

Meanwhile, ANA has sought approval from the government for taking over some international routes from JAL, while winnowing overlapping service routes.

JAL's international routes will be greatly affected by developments in the business environment in the days ahead. For this reason, the bailout body is believed to have concluded that it would be difficult to include any concrete plan for cutting routes by the time JAL is scheduled to sign a formal contract with Delta next month.

JAL mileage points to be assured

The state-backed body leading JAL's turnaround announced Wednesday it would guarantee customers' mileage program points and four other types of credit in its rehabilitation plan for the ailing carrier.

The turnaround body said, in addition to assuring mileage points, it would guarantee credit for commercial transactions and lease credit for aircraft, as well as backing air tickets and complimentary gift certificates for shareholders that have already been issued.

The turnaround body plans to limit confusion among JAL's business partners and customers by clearly announcing the types of credit subject to guarantees prior to making a decision on providing the airline with financial assistance. It also has added information in English on its Web site in a bid to head off credit uncertainty overseas.

2,910 firms rely on JAL group

About 2,910 firms in this country are main business partners with JAL group firms, according to a credit research company.

Damage to these companies due to so-called chain-reaction bankruptcy resulting from JAL's rehabilitation is expected to be limited, as credit for general business with JAL is expected to be protected after the airline applies for court-led restructuring under the Corporate Rehabilitation Law.

However, Tokyo Shoko Research said the reduction of JAL's flights to regional airports could have a ripple effect on firms whose business depends on these operations.

Firms that handle livelihood-related services as well as entertainment companies, such as linen suppliers and travel companies, comprise the largest category among the 2,910 firms. Firms that provide services and sales mainly at regional airports also are likely to be affected.

Many of the firms are based in Chiba Prefecture, where Narita Airport is located, Tokyo and Osaka Prefecture, as well as Okinawa Prefecture and Hokkaido, which have large tourism sectors. Most of the companies are small or midsize firms with annual sales under 1 billion yen.

Tokyo Shoko Research compiled its findings by looking at firms in its database that primarily trade with JAL group firms.

 

[ACL65PILOT]

JAL, Delta reach basic deal over comprehensive tie-up
The Yomiuri Shimbun

Japan Airlines and Delta Air Lines on Friday reached a basic agreement on a comprehensive tie-up that mainly features code-sharing flight services, company sources said.

The ailing airline and the world's largest carrier are likely to officially sign the deal after it is finally endorsed by new JAL top management that will be inaugurated after the JAL group applies for the application of the Corporate Rehabilitation Law.

Kazuo Inamori, honorary chairman and founder of electronics firm Kyocera Corp., will lead JAL's new management as chief executive officer.

The basic agreement was reached in working-level talks between JAL and Delta at the embattled airline's head office in Tokyo.

The Enterprise Turnaround Initiative Corporation of Japan--a state-backed corporate rehabilitation body that is playing a key role in JAL's reconstruction--apparently believes that a tie-up with Delta will improve the efficiency of JAL's services in international routes. The corporate turnaround body is convinced this will make it possible for JAL to bring its struggling business back on track at an early date, according to the sources.

Delta holds a predominant market share in Pacific routes between Japan and the United States. JAL's international operations have hampered its profitability over the years.

The tie-up means JAL will switch from the Oneworld airline alliance to the SkyTeam group, to which Delta belongs.

JAL and Delta will ask the U.S. Transportation Department for antitrust immunity by mid-February. If the application is accepted, the two airlines will be able to efficiently run flights over their Pacific routes in what amounts to business integration.

Meanwhile, transport minister Seiji Maehara and Prime Minister Yukio Hatoyama agreed Friday night that legal procedures for JAL's bankruptcy protection would be initiated Tuesday. They made the decision during a meeting at the Prime Minister's Office.

JAL and its two main subsidiaries, Japan Airlines International Co. and JAL Capital Co., will apply for the application of the Corporate Rehabilitation Law. This will be followed by an official decision to be made by the turnaround body to aid JAL's rehabilitation, thus officially placing the cash-strapped carrier under state control.

On Tuesday, the government will issue a statement pledging to take all possible steps to ensure JAL's flight services are provided without a hitch. It will also provide nations that JAL flies to and from with explanations about matters pertinent to JAL's rehabilitation, including the protection of their claims related to business transactions with the ailing carrier.

 

[NuGuy]

OOOOOOO, AMR is gonna be P.O.ed. Their presence in the Pacific just went down the drain.

Moral of the story....don't outsource mission critical items. That goes for everyone.

Watch out ALK, you're now in play. Good luck.

Nu

 

[Acey]

I heard one of the conditions the Japanese stipulated to Delta was that CVG stays open so Toyota and Honda execs can get back and forth easily. (TIC)

Wow! This is a real game changer! I don't see how premium business revenue will stay away from Sky Team now.

I have the sense that it was EB who pulled this one off? Anyone know?

And the implications are that their new partner is going to have to pick up some of the slack that they're eliminating from their system (including taking some of their aircraft off their hands?).

And Haneda has just been secured for DL/NW.

Game. Changer.

Acey

 

[Monster Buck]

hmm, i figured MEM would get hammered when the 30's/40's get parked in Oct. Maybe they'll shift the DC9s out of MSP to MEM and MEM will do alot of the DC9 flying. Who knows

DTW dc9 shrinks 35% over what it is today. MSP dc9 will turn into all 88/90. I don't know the effect on MEM.

 

[Monster Buck]

OOOOOOO, AMR is gonna be P.O.ed. Their presence in the Pacific just went down the drain.

Moral of the story....don't outsource mission critical items. That goes for everyone.

Watch out ALK, you're now in play. Good luck.

Nu

Hopefully Alaska can stay on their own but Oh God please let AMR get Alaska and not Delta.

 

[Diesel-9]

Now we know why NWA is going to train 30 crews a month on the 744 for the next 18 months! YIKES!!!!

 

[Truckdriver]

DTW dc9 shrinks 35% over what it is today. MSP dc9 will turn into all 88/90. I don't know the effect on MEM.

I'm no expert here, but I would put the 88/90's in MSP and DTW, close the MEM DC-9 base, then move all the -9's to ATL. Then I'd put a -9 on every route that Airtran flies with a 717.