JAL files for bankruptcy and begins to restructure

ASIA’S largest airline by revenues, Japan Airlines, is expected to file for bankruptcy this week as part of a restructuring crafted by a state-backed turnaround fund.

Some analysts think a bankruptcy filing would make it easy for Japan Airlines to abandon its deal with AMR, the holding company for American Airlines, in favour of membership in Delta Airlines’ SkyTeam alliance.

American Airlines and Delta have been wooing the Japanese carrier, which offers access to routes in growing Asian markets.

US airline consultant Michael Boyd said: “It might be better for American because it’s going to force them to cut a deal with a Chinese carrier, and that’s where the real growth is going to be.” For American the stakes are high as it looks to improve its competitiveness against industry leader Delta and UAL Corp’s United Airlines on Asian routes.