IAG woos Japan Airlines

dhdBy Tania Suárez, in Madrid | IAG’s CEO Willie Walsh said last year that if the opportunity arose, they would definitely be willing to take a major equity stake in Japan Airlines. Now, that opportunity has apparently arisen. IAG has come to an agreement with Japan Airlines (JAL), and both companies will soon sign a joint business agreement. According to Walsh himself, IAG has

“established very close links with JAL” and “hopes to improve that relationship.” Walsh also points out that “despite the difficulties of the Japanese aviation market these last years, we have great confidence in JAL’s business prospects and future projects”.

This joint business agreement will be similar to that of American Airlines and IAG for Europe-USA flights, although this time it will involve Europe-Japan flights. The agreement will improve the connections between both geographical areas.

Experts from Ahorro Corporación Financiera (ACF) consider that the joint venture is an opportunity to

“increase the number of flights, take up the points programme and, in the future, be able to launch new routes.”

So far, JAL has submitted the antitrust immunity application to the Japanese Ministry of Economy, Trade and Industry (METI), and IAG will have to do the same within the European Union. The joint venture is currently awaiting confirmation by Japanese and European authorities. Usually, approval processes are quite long but, in ACF’s opinion, in this particular case they could go faster due to Japan’s situation after the big earthquake. The catastrophe left the company with a fall of -15.2% of the passenger carried per km, and of -11.5% of the available seat per km, cutting the passenger load factor to 61.2%.

About the Author

The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.

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