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Wednesday, Jan. 12, 2011

American, JAL tie up to boost revenues


Staff writer

Japan Airlines International Co. and American Airlines Inc. announced Tuesday a joint business scheme from April to expand their partnership and improve efficiency.

JAL, which filed for bankruptcy a year ago, and American said they will divide revenue generated from Pacific operations. The arrangement includes coordinating pricing and sharing routes between Japan and the U.S., as well as facilities, sales data and marketing strategies.

Combined, the airlines' revenues are expected to improve by about ¥13 billion, JAL President Masaru Onishi told reporters in Tokyo.

The announcement follows approval last year by the U.S. and Japanese governments of antitrust immunity for the joint operations over the Pacific.

As of Tuesday, the joint business will apply to 10 trans-Pacific routes. The number is expected to grow in the future, said the two carriers, which are members of the aviation alliance oneworld.

"Our joint business will allow our airlines and oneworld as a whole to offer better service and increase competition between North America and Asia," American Airlines President Thomas Horton said at a press conference in Tokyo.

"Our other stakeholders, such as our employees and investors, will also benefit as our airlines compete more effectively, through cooperation and share revenue on routes within the joint business," he said.

The two carriers won antitrust immunity from the U.S. Department of Transportation and the Land, Infrastructure, Transport and Tourism Ministry last November and October, respectively.

The immunity allows the two carriers to jointly conduct business that would normally violate antitrust law, including setting flight schedules and ticket prices between them.

At the press conference, JAL's Onishi said the open skies treaty between the U.S. and Japan "intensifies aviation competition, but JAL and American Airlines are ready to face such (an era) by strengthening our competitiveness by jointly offering better service, increasing our efficiency and strengthening our business operations."

Prior to the commencement of the joint business on Apr. 1, JAL and American Airlines on Tuesday said they will offer special economy-class airfares between the U.S. West Coast and Tokyo from the same day for flights between Feb. 1 and March 31.

Under this deal, the round-trip airfare between Tokyo and San Francisco is set at ¥69,000, including fuel surcharge, Onishi said.



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