Airlines eye Asian growth through JAL

City A.M. Reporter
AIR FRANCE -KLM is understood to be in talks to invest in Japan Airlines, joining a list of suitors seeking a stake in the loss-making carrier to access its route network.<br /><br />Delta Air Lines and American Airlines are also believed to be in separate talks with JAL, Asia&rsquo;s biggest carrier by revenue. Each airline is thought to be discussing an investment of $200-$300m (&pound;121.1-&pound;181.9m) in exchange for a minority stake and a code-sharing relationship with the Japanese carrier, but talks are fluid and the numbers could yet change .<br /><br />Analysts said JAL would have a difficult choice ahead and JAL is expected to be weighing those advantages carefully against the significant cost of leaving Oneworld, an alliance which includes American Airlines.<br /><br />Each airline is seeking access to JAL to help expand in Asia via code-sharing agreements.<br /><br />Japan&rsquo;s main domestic airport Haneda is the world&rsquo;s third busiest by passenger numbers and is adding international flights. Tokyo&rsquo;s international airport, Narita, also plans to expand airline slots.<br /><br />JAL, which is undergoing state-supervised restructuring, is understood to prefer American Airlines because of the Oneworld alliance. But the Japanese government prefers Delta or Air France-KLM, which it sees as financially healthier than American.<br /><br />JAL lost about $1bn last quarter and is under growing pressure to raise money and slash costs after securing a 100bn yen (&pound;665m) government-backed credit line earlier this year. The airline has forecast a net loss of 63bn yen for the year to end-March.<br /><br />It plans to cut overseas flights and increase personnel cuts over the next three years in a bid to reduce operating costs by 30 per cent, Japanese media said.