Japan Airlines Corp., Asia's most indebted carrier, should expand code-sharing agreements with other airlines to boost passenger traffic without the cost of operating new routes, the civil aviation chief said Tuesday.
The carrier, which aims to cut ¥195 billion in the year ending next March, would benefit from code-sharing with Delta Air Lines Inc., the world's largest carrier. Delta's Northwest Airlines Corp. is the biggest overseas carrier at Narita airport, the nation's main international gateway.
"By joining with Delta and Northwest, they could expand their network," Ryuhei Maeda, director general of the transport ministry's Civil Aviation Bureau, said in an interview in Tokyo Tuesday.
JAL, which started reporting details of its business to the transport ministry after receiving a ¥60 billion government loan, needs to reduce costs and boost revenue, Maeda said. Transport minister Kazuyoshi Kaneko said on June 19 the airline needs to speed completion of its cost-cutting plans after winning financing from the state-owned Development Bank of Japan.
The Tokyo-based carrier, which already code-shares with AMR Corp.'s American Airlines, is cutting international routes after a global economic slump caused the biggest drop in passengers since the SARS epidemic struck in 2003.
JAL President Haruka Nishimatsu has declared "nothing off limits" for cost-cutting after the carrier posted a first-quarter loss of ¥99 billion.
JAL joined the Oneworld code-sharing alliance, which includes American Airlines, two years ago. Delta is a member of the SkyTeam partnership.
"They don't need to cut their tieup with American Air," Maeda said, adding an agreement with Delta would specifically help expand its U.S. network.