JAL, ANA considering abolishing or cutting flights on 27 routes

Tuesday 05th August, 07:12 AM JST

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10 Comments

some14some at 07:35 AM JST - 5th August

that's good, increase your profits when fuel prices are going down.
nisegaijin at 11:34 AM JST - 5th August

that's good, increase your profits when fuel prices are going down

do you really think that they will keep going down? i think this will change as soon as this week.
fds at 11:58 AM JST - 5th August

actually their "fuel surcharge" bears no reasonable relationship with their fuel costs. they only charge it for their international flights and its not required by law.
Statistician at 12:34 PM JST - 5th August

They should try cutting costs and get competitive
the_sicilian at 05:16 PM JST - 5th August

Does this mean ANA and JA: will start charging for the Dixie cup of oolong tea?

Addiu
rajakumar at 06:16 PM JST - 5th August

JAL,ANA cut costs via flight routes cuts. Japan airlines companies should tie up via joint ventures with Emirates, to up finance.
DJHondaTypeR at 07:07 PM JST - 5th August

People, have you all heard of fuel hedge? This is where the source of this problem is. Did JAL decide to Hedge when fuel jumped from $30 to $60... no. From $60 to $80...? So now Oil just dipped below $120/barrel.

Google Southwest Airlines to get some background on this: "2007 is 95% hedged at $50/barrel; 2008 is 65% hedged at $49/barrel; 2009 is over 50% hedged at $51/barrel; 2010 is over 25% hedged at $63/barrel; 2010 is over is 15% hedged at $64/barrel; 2012 is 15% hedged at $63/barrel."
Freespeech at 08:18 PM JST - 5th August

DJHondaTypeR brings us one vital element of answer : hedging. But note that it is not because an airline hedges fuel that its fuel costs are not increasing very sharply : Air France-KLM hedges, thanks God, and nevertheless their fuel costs have increased 25% year over year (figure not corrected for taking into account their global increase of activity). Another life-saver for Japanese airlines has to be... productivity improvements. Surely something can be done. Do you know that amongst OECD countries the global productivity of Japanese work (measured over a year) is one of the worst ? Last time I saw the figures, Japan had something like 60% of the productivity of the USA. All is not like Toyota in Japan (as a matter of fact, companies like Toyota, Sony, NEC, are islands of productivity in an ocean of un-productivity). Still another front for fighting is the equipment : JAL and ANA are overburdened with obsolete fuel-guzzling airplanes. Of course they have proudly avoided ordering any of the new A380 super-jumbos, interesting to compare with the attitude of some (including Air France-KLM) who deplore not being proposed yet a more efficient "stretched" version of the beast... In an oil-deprived world, the future belongs to who will have the biggest possible units on each route, given the flux of passengers on that route. And their "fight" against high-speed trains on short domestic routes is preposterous : at least, if this fight was a real one, it should enable the consumers to enjoy low competition-driven prices, which you all know is not the case, the prices over a distance like Tokyo-Osaka being shocking if you compare with similar runs in Europe. Let us finish with a note of fun (re. productivity) : do you know that JAL's pilots (at least I am sure for the long-range ones) are picked at home by chauffeur-driven cars before their flights, and that the chauffeurs usually arrive near the front door of their "client" hours (hours) before the agreed time, thereby taking a sleep in the car, just to be sure ; and if two pilots live in the same area (which is not uncommon in the Chiba area), of course there will be 2 distinct chauffeured cars for these two little princes. What about cost ? Would a pilot of -say- a US company tell us how his commuting from home to airport is arranged ?
motytrah at 02:11 AM JST - 6th August

JAL and ANA will cut costs when Boeing finally delivers the 787 and 777 they've had on order. They both have fairly old international fleets of old inefficient planes.
USNinJapan2 at 07:28 AM JST - 6th August

Freespeech

Would a pilot of -say- a US company tell us how his commuting from home to airport is arranged ?

You've seen those guys walking along the road with their thumbs out haven't you? ; )