ATW Daily News

JAL job cuts may rise to 13,000 under new restructuring plan

Tuesday October 27, 2009

The Japanese government and Japan Airlines reportedly will unveil a new turnaround plan for the troubled carrier later this week that will include slashing 13,000 jobs and giving a new government-backed agency control over JAL's restructuring process.

Kyodo News reported that the new plan will nearly double the 6,800 job cuts that were called for in JAL's original restructuring proposal (ATWOnline, Oct. 20). The reductions would be carried out in phases and concluded by March 2015, according to the report.

Nikkei reported that Enterprise Turnaround Initiative Corp. of Japan, a newly created quasi-government entity that is charged with buying debt from strapped companies and providing them with specialists to help oversee restructuring programs, will be put in charge of JAL's turnaround. The report stated that ETIC could provide loan guarantees to enable skittish banks to lend JAL money, or could even lend funds directly to the airline. It reportedly needs a ¥200 billion ($2.17 billion) loan to enable it to stay afloat through the end of its fiscal year that concludes March 31.

Meanwhile, foreign investors continued to show interest in taking stakes in JAL, which last month revealed that it had held talks with both American Airlines and Delta Air Lines regarding one of those carriers investing in it. Bloomberg News reported that DL has contracted Fleishman Hillard to help it lobby the Japanese government on the issue.

JAL on Sunday downsized from 747-400s to 777-300ERs on flights from Tokyo Narita to Los Angeles and Chicago O'Hare (ATWOnline, Aug. 10).

by ATWOnline Staff

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