JAL seeks government bailout
26 Sep 2009
Japan Airlines president Haruka Nishimatsu has conceded that even a cash infusion from a foreign investor was not likely to keep the troubled carrier afloat. It is currently in talks with American Airlines and Delta Air Lines to see if either one of them would be interested in picking up a stake in the struggling carrier.
Nishimatsu was speaking to reporters soon after meeting Seiji Maehara, Japan's new transport minister, whom he met to seek a government bailout.
Nishimatsu declined to say how much capital the carrier was seeking from the government.
The carrier, which lost ¥99 billion ($1.09 billion) in its fiscal first quarter ended 30 June, has already received government-backed loans from the Development Bank of Japan of around ¥100 billion. According to industry sources, JAL needs another ¥100 billion to keep afloat till early 2010.
The carrier has already announced a restructuring plan which involves shedding 14% of its workforce, or nearly 6,800 jobs, over the next three years. The plan also seeks to eliminate 50 routes, particularly international ones.
These plans have failed to impress the incoming government, apparently, for Maehara told reporters that he's "not convinced" the company's restructuring plan will work.
