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The Honolulu Advertiser
Posted on: Tuesday, January 26, 2010

JAL expected to remain marathon sponsor


By Michael Tsai
Advertiser Staff Writer

Hawaii news photo - The Honolulu Advertiser

The JAL-sponsored Honolulu Marathon pumped an estimated $104 million into Hawai'i's economy last year.

ADVERTISER LIBRARY PHOTO | Dec. 14, 2008

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Japan Airlines has been the title sponsor of the Honolulu Marathon for 25 years and JAL's bankruptcy filing notwithstanding Honolulu Marathon Association president Jim Barahal has no expectation that will change this year or in the foreseeable future.

"They have a great deal of loyalty and there has been no indication that they have any intention of not being our title sponsor," Barahal said. "I would be shocked if they didn't continue to be our sponsor."

Facing $25.6 billion in debt, JAL last week filed for one of the largest bankruptcies ever in Japan.

A reorganization plan that had been months in the making calls for JAL to cut 15,661 jobs (roughly a third of its payroll) over the next three years, reduce pensions for retirees, and shift to more fuel-efficient aircraft.

The Honolulu Marathon, which last year pumped an estimated $104 million into the local economy, is regularly ranked among the largest marathons in the world, largely on the strength of the thousands of Japanese runners who participate each year.

As Barahal notes, the marathon has benefited greatly from its long relationship with the Japanese airline, which maintains prized routes in Japan and throughout Asia.

Barahal would not disclose how much JAL contributes each year nor the terms of the agreement between the two organizations. Still, given the airlines position as title sponsor, its financial contributions are understood to be significant.

Barahal said he will meet with JAL officials in Japan as scheduled at the end of the month.

Barahal dismissed the possibility of having to find a new title sponsor as a nonissue.

"I won't speculate about what would happen if they weren't our title sponsor," he said. "It's not going to happen."

Indeed, JAL has maintained title sponsorship of the race through the Asian economic crisis, the SARS pandemic, the current worldwide economic downturn and the H1N1 pandemic.

Hawai'i Pacific University professor of travel industry management Jerry Agrusa, who conducts an annual economic impact study on the Honolulu Marathon, said JAL accumulated much of its current debt as a result of the current economic crisis and fears over the H1N1 pandemic.

"The Japanese are very cautious people and they're not going anywhere where there are foreigners during an epidemic," he said. "Even though the (Japanese) economy is better, they're still afraid of the second wave of swine flu this fall."

Without speculating specifically about JAL's relationship to the marathon, Agrusa said that companies sometimes drop sponsorships to avoid the perception of unnecessary spending.

"Even if a company has money, in a bad economy it doesn't want to be perceived as showing off," he said. "You don't want to be perceived as a big spender when you're having to lay people off."

In addition to JAL's title sponsorship, the Honolulu Marathon also receives direct financial support from supporting sponsors MUFG Card and NIKE, and contributing sponsors NTT DoCoMo, Satohap and Subaru as well as in-kind support from Outrigger Hotels and Resorts.

"I'm very pleased with our level of sponsorship," Barahal said. "Events are always looking for (more sponsors), and we are, too, but we're happy with where we are and we're in a strong position to move forward."

And Barahal's confidence seems to be supported by the relative stability of sponsorships for major marathons despite the economic downturn.

While race directors have spoken publicly of the need for more sponsors, participation in road races has increased to record levels over the last several years and sponsors continue to find value in investing in the largest events.

"Our sport is not recession-proof, but it has been recession-resistant," said Ryan Lamppa, media director and researcher for Running USA. The sport is growing in most of the country and the demographic (of runners) tends to be higher for education and income. For a company like ING (title sponsor of the New York Marathon), that's their customer. Sponsoring these races is a way to get further into the mind of the potential customer."

While participation data for 2009 has not yet been fully compiled, Lamppa said he expects the final tally to reach a record 10 million participants.

Lamppa said the nature of the sport virtually assures its popularity during difficult times.

"Running is something you can control, unlike the economy," he said. "It's inexpensive, it's fun and you can relieve stress. The events themselves are fun and family-oriented and there is a real sense of community.

"There has been so much doom and gloom with the economy and the wars in Iraq and Afghanistan," Lamppa said. "Running is like a chance to get away from all of that in a way that is positive."