Japan Airlines bookings still slow

By Tim Kelly
Bloomberg News Service

TOKYO — Japan Airlines Co., Asia's biggest carrier, said advance bookings on international flights in December fell 25 percent compared with a year ago, after a drop in travel demand since the terrorist attacks in the United States.

The figure compares with a 40 percent fall in passenger numbers in November, and a 35 percent drop in October, said company spokesman Geoff Tudor. "November was the trough, we hope," he said.

Japan Airlines is struggling with weak demand for air travel after the Sept. 11 attacks, and has cut capacity in a bid to stem losses. The carrier, which makes about 70 percent of its flight revenue on overseas routes, is looking out for any signs of recovery in the travel market.

Isao Kaneko, president of Japan Airlines, is in Hawai'i today along with at least 20 other heads of Japanese travel companies to talk with Gov. Ben Cayetano and Hawai'i tourism industry leaders about coordinating efforts to encourage more travel among the Japanese.

The carrier has already cut 9 percent of seat capacity on overseas routes to the end of March in a bid to match reduced demand. Trans-Pacific routes, where the fall in demand has been greatest, have been slashed by 28 percent.

"We, in the industry, believe that this may not be a one-time phenomenon, but rather could undermine the fundamentals of the entire international travel industry in Japan," said Kaneko in a statement announcing the Hawai'i meeting.

The Tokyo-based carrier, which in November reported a 61 percent fall in profit to $128 million in the six months to Sept. 30, expects a loss of $320 million for the full year to the end of March.

"Even if passengers are returning, there's still the issue of lower fares," said Ichiro Takamatsu, who helps manage about $480 million in stocks for Cigna International Investment Advisors Co. If fares are too low, the airline can't make a profit, he said.