Massive restructure, possible bankruptcy for JAL

written by australianaviation.com.au | January 12, 2010
A JAL 747-300 at Honolulu. (Paul Sadler)
A JAL 747-300 at Honolulu. (Paul Sadler)

Japan Airlines will slash a third of its workforce, will reject billion dollar cash offers from American Airlines and Delta, and may file for bankruptcy as it seeks to turn itself around, according to Japanese media.

The Kyodo News reports the airline will slash 15,600 jobs over the next three years and will take on an investment of ¥300bn (A$3.5bn) from the government Enterprise Turnaround Initiative Corp while it wipes its debts under US-style bankruptcy protection laws. Further, the Asahi newspaper reports the airline’s shares will be delisted after they plunged to just ¥67 each (A$0.78c) since New Year.

While a closer partnership with one of the US airlines and their respective alliance groups is still possible, it is unlikely it will involve any equity stake as the government body says that would complicate the restructure. JAL is currently a member of the oneworld alliance along with American, BA and Qantas, while Delta is a member of the SkyTeam group of airlines.

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