JAL offers service with a smile

January 15, 2010

, TOKYO, Jan 15 – As debt-crippled Japan Airlines heads towards an expected bankruptcy filing, its pilots and cabin crews have taken their legendary courtesy to new heights.

Passengers flying with the carrier have been greeted by JAL personnel, both working and retired, who have expressed their gratitude to them, one-by-one, for sticking with the troubled airline.

"Thank you very much for choosing JAL," uniformed airline officials told customers, bowing politely and handing them hand-written cards that thanked them for their continued loyalty to the once-iconic carrier.

JAL is in deep trouble, and some of the passengers jetting off for overseas holidays may have been excused for wondering whether their return tickets would still be valid.

Shareholders this week strapped on their parachutes and jumped.

As the airline prepared for court-supervised restructuring and delisting, the share price — which soared to 366 yen in 2003 — plunged more than 80 percent in a day to just seven yen (eight cents) on Wednesday.

The share price rebounded somewhat on Thursday, but nobody doubts that JAL faces the end of an era and a radical remake under a new CEO and the guidance of a state-backed turnaround body.

JAL is widely expected to file for bankruptcy next Tuesday and later shed more than 15,000 jobs, about a third of its workforce. Its retirees and staff have already agreed to sharp cuts in their pension benefits.

The state-backed Enterprise Turnaround Initiative Corp., now overseeing the restructuring, will provide 300 billion yen (3.2 billion dollars) so that it can continue operations, news reports have said.

JAL, which lost about 1.5 billion dollars in the six months to September, also plans a drastic cut in routes and a sell-off of non-core assets, and reportedly may turn part of its operations into a low-cost carrier.

"I wonder if they can keep up their great hospitality in future," said Motoe Kurasawa, 40, who was leaving from Tokyo\’s Haneda airport for a holiday in South Korea this week.

"I often use JAL because their politeness and passenger service are incomparably better than that of the foreign airlines. I hope they\’ll succeed in their corporate restructuring," she said.

Others were less complimentary about the airline, which was once a symbol of Japan\’s post-war rise to prosperity but has kept flying only with the help of three large government bailouts since 2001.

"Isn\’t it a private company?" asked Teruo Yokoura, 70, an office worker.

"I think JAL can disappear. I\’m opposed to injecting public money. To me, they\’ve been unsuccessful in management reforms because they still have a bureaucratic atmosphere."

Industry watchers have pointed to various causes for JAL\’s demise — global shocks to the aviation sector such as the 9/11 attacks and the economic downturn, but also rigid management and political interference which forced the airline to fly unprofitable domestic routes.

Kiyomi Nakao, 43, a part-time saleswoman in southwestern Shimane prefecture, said: "I\’d be troubled if JAL abolishes the local flights I use. It\’ll take hours for me to get to Tokyo."

Another passenger, accountant Fuminori Izumi, 44, from Misawa northern Japan\’s Aomori prefecture, said: "I\’ll accept it if JAL abolishes flights between Tokyo and my city, where we now have three flights a day. The airline is losing money and I think it needs to rebuild its business from zero."

There is one area in which the airline must not cut corners, said Izumi, who was travelling with his two young children and wife.

"I hope they\’ll keep doing enough mechanical checks," he said.

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