Japan Airlines (JAL) has announced plans to reduce its work force by about 14 percent over the next three years. This means some 6,800 of JAL's current 48,000 employees will lose their jobs.The airline, which is Asia's largest carrier by revenue, also wants to reduce to reduce the pay and pensions of pilots and other workers. Earlier this year, JAL asked pilots, cabin crew, and ground workers to volunteer for two months of unpaid leave, and even suspended part of its pilot training programs to save money.
Today's announced job cuts are part of JAL's restructuring plans, which also include a large reduction in international passenger and freight flights. The Financial Times, quoting a Japanese transport ministry official, reports that "JAL's international and domestic routes are currently split 50-50, but the airline would now focus more on domestic services."
At present, JAL is in talks with Delta Airlines, American Airlines, and Air France-KLM about their possible investment in the Japanese carrier. In return for an infusion of between $200 million and $300 million, the investor airline(s) would gain access to important Asian markets -- China, in particular -- through code-sharing.
As Reuters columnist Alexander Smith writes:
Oneworld and to a greater extent SkyTeam -- which includes Air France and Delta -- are both relatively under-weight in Asia and will seize on any opportunity that comes along. If winning the prize means providing cash to bail out an ailing airline such as JAL, then they see it as a necessary evil.Smith also mentions the that such a deal might present "an opportunity to push an open skies deal with the United States." At the same time, notes Smith, "nobody is holding their breath for the United States to relax its rules so far as to allow majority foreign ownership -- especially in the middle of a recession."
