Air Transport World

ASIA/PACIFIC REPORT.(airlines)

All Nippon Airways expects to report a loss for the fiscal year ended March31 of [yen]3.2 billion ($25.2 million) vs. last year's [yen]3.9 billion net profit. The loss was blamed on difficulties in the Japanese economy and increasing competition on domestic routes. Bad weather in Jan. also contributed, the company said.

On a consolidated basis, ANA forecasts a net loss of [yen]7.2 billion, after last year's net profit of [yen]4.3 billion. The annual dividend will be suspended.

In response to its problems, ANA unveiled "speed 21," a 3-year restructuring and cost-cutting plan that limits hiring and offers early retirement. It would reduce salaries of pilots and managers by an average 3% starting this month. It will affect salaries of 3,000 employees and save $5.6 million within a year. Also, ANA intends to reduce staffing by 1,000 by 2001, and will trim investment and financing by 20% through 2001.

In the fiscal year through March 31, 1999, ANA will add 10 aircraft and retire six, raising the total fleet to 143 from 139. Total ASKs will rise 5.7%. Aircraft leaving the fleet include two 747-100SRs, one 747-200 and three 767-200s. Additions include two 747-400s, two 777-200s, four 777-300s and two A32ls.

Japan Air System is expected to report operating losses of [yen]4.5 billion for the fiscal year ended March 31, up from [yen]320 million in the year-ago period, owing to weaker than anticipated domestic traffic. Net profit is expected to be unaffected, however, with the forecast profit of [yen]280 million ($2.2 million) to occur on the strength of aircraft sales. Overall revenues are estimated to have increased 3% to [yen]327 billion.

The tougher domestic market is the result of new competition from Japan Airlines and ANA, who are benefiting from the government's decision to add more operations at Tokyo Haneda. …

Log in to your account to read this article – and millions more.