Discussion:
Future of JAL and alliances
(too old to reply)
JF Mezei
2010-01-18 09:49:12 UTC
Permalink
BBC reports that "bankrupcy" for JAL should be reality this Tuesday.

I assume that this is closer to "chapter 11" since they talk about
restructuring. JAL's shares are now near worthless.

Some reports say that JAL would ditch its fleet of 747s.

Found a march 2009 fleet at:
http://www.jal.com/en/corporate/gaiyo/flight.html
(it is near the end of the page).

Since almost all their 747s are owned (as opposed to leased) , does it
make sense to sell them now ? Is there much of a market for used 747s at
present ?

Or are their operating costs such that it is better to ground them ?
I can see some reasoning behind retiring 747-200 and -300s.

Looks to me like their domestic fleet is rather "mixed" and could do
with some streamlining.

There is talk that Delta may convince the "new" JAL to join Skyteam, and
American Airlines trying hard to keep JAL in Oneworld.

While I can see the strategic value for DL or AA as indidual airlines
who lack an asian network, are airline alliances still as important as
they used to be ?





The impression I get from my canadian viewpoint is that people don't
have as much loyalty to their airline as they used to. When alliances
were introduced, they were mean to be "seamless" between member
airlines. And back then, getting free flights from your points wasn't
just a dream.


That "seamless" travel has eroded over the years, especially when
luggage rules stopped being uniform, so what may have been allowed in
the outbound flight may end up costing you an arm and a leg on the
return flight.


While alliances may still provide "value" to premium travellers (access
to lounges for instance), to the average j.q.public, do they still
provide any value ?


For AA or DL, would this be more of a case of them wanting to take over
JAL's Japan-USA flights and make use of idle capacity in their fleet ?
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Roland Perry
2010-01-18 11:36:45 UTC
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Post by JF Mezei
While alliances may still provide "value" to premium travellers (access
to lounges for instance), to the average j.q.public, do they still
provide any value ?
As far as I'm concerned, the answer is "no, not at all".

The only benefit has ever been collecting miles when flying on partners,
and the recent split between Continental and KLM-AirFrance has destroyed
the partnership I used the most.
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Roland Perry
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John Levine
2010-01-19 01:32:21 UTC
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Post by Roland Perry
The only benefit has ever been collecting miles when flying on partners,
and the recent split between Continental and KLM-AirFrance has destroyed
the partnership I used the most.
Funny about that, CO's switch means that I'll now be flying on them
again.

At first glance the alliances all seem the same, but if you look more
closely, there's considerable differences. Star has what appears to
be the best cross-alliance partner award program, in which it is quite
easy to put together reward trips on multiple airlines for reasonable
milage.

R's,
John
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Jeff Hacker
2010-01-18 22:25:34 UTC
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Post by JF Mezei
BBC reports that "bankrupcy" for JAL should be reality this Tuesday.
I assume that this is closer to "chapter 11" since they talk about
restructuring. JAL's shares are now near worthless.
Some reports say that JAL would ditch its fleet of 747s.
http://www.jal.com/en/corporate/gaiyo/flight.html
(it is near the end of the page).
Since almost all their 747s are owned (as opposed to leased) , does it
make sense to sell them now ? Is there much of a market for used 747s at
present ?
Absolutely, but there still seems to be room for 747-400's in today's
market.
Post by JF Mezei
Or are their operating costs such that it is better to ground them ?
I can see some reasoning behind retiring 747-200 and -300s.
Again, as to the -200's and -300's, I would agree with you, but I think
the -400's are still good for a few more years.
Post by JF Mezei
Looks to me like their domestic fleet is rather "mixed" and could do
with some streamlining.
There is talk that Delta may convince the "new" JAL to join Skyteam, and
American Airlines trying hard to keep JAL in Oneworld.
While I can see the strategic value for DL or AA as indidual airlines
who lack an asian network, are airline alliances still as important as
they used to be ?
I think this is a strategic move. Delta has Northwest's Tokyo (Narita) hub,
and they're the 3rd largest carrier there. If you've ever flown through
Narita in the mid afternoon to early eavening, you know what I mean. Delta
doesn't really need JAL's feed at Tokyo, especially with fellow Sky Team
carrier Korean having Incheon only an hour's flight from there. BUT Delta
certainly would like to create problems for AA, which has limited service to
Tokyo and no service beyond other than what oneWorld partners, particularly
Cathay Pacific, offer.
Post by JF Mezei
The impression I get from my canadian viewpoint is that people don't
have as much loyalty to their airline as they used to. When alliances
were introduced, they were mean to be "seamless" between member
airlines. And back then, getting free flights from your points wasn't
just a dream.
That "seamless" travel has eroded over the years, especially when
luggage rules stopped being uniform, so what may have been allowed in
the outbound flight may end up costing you an arm and a leg on the
return flight.
While alliances may still provide "value" to premium travellers (access
to lounges for instance), to the average j.q.public, do they still
provide any value ?
For AA or DL, would this be more of a case of them wanting to take over
JAL's Japan-USA flights and make use of idle capacity in their fleet ?
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JF Mezei
2010-01-19 04:31:27 UTC
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Post by Jeff Hacker
I think this is a strategic move. Delta has Northwest's Tokyo (Narita) hub,
Oops ! I had forgotten about Delta having NW's routes. All of a sudden,
Delta has become an important asian airline.

If JAL gets into bed with Delta, would there be much route
rationalisation happening between Delta and JAL ? If so, it is more
likely to see JAL cut routes or DL ?


Your theory about DL wanting to create problems for AA is interesting.
And it is true that AA needs JAL far more than DL. But can DL really
afford to spend money just to hurt a competitor ? (Although from what I
heard, DL wouldn't have to dish out much money.)

From an european perspective though, does BA need JAL more than AF/KLM ?
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Jeff Hacker
2010-01-19 14:00:39 UTC
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Post by JF Mezei
Post by Jeff Hacker
I think this is a strategic move. Delta has Northwest's Tokyo (Narita) hub,
Oops ! I had forgotten about Delta having NW's routes. All of a sudden,
Delta has become an important asian airline.
If JAL gets into bed with Delta, would there be much route
rationalisation happening between Delta and JAL ? If so, it is more
likely to see JAL cut routes or DL ?
Your theory about DL wanting to create problems for AA is interesting.
And it is true that AA needs JAL far more than DL. But can DL really
afford to spend money just to hurt a competitor ? (Although from what I
heard, DL wouldn't have to dish out much money.)
From an european perspective though, does BA need JAL more than AF/KLM ?
Northwest's routes to/thru Japan are very strong, although, in recent years,
I believe they've given up a large portion of the premium market since their
inflight service is generally considered to be inferior to most of the Asian
airlines. But they have a lot of flights to Japan from the U.S., China,
Korea, Hong Kong, Singapore, Manila, and even Guam.

From a European standpoint, BA already has Cathay Pacific and Dragon Air,
but AF/KLM has Korean Air, so it is kind of a tossup (although of those two,
I think CX is probably a bit stronger, because of the China connection).

JAL is kind of another gem in the region, with a very strong reputation and
a strong network. But Delta's interest is more along the lines of when
United went after US Airways, primarily to keep them away from American
(although obviously that didn't work).

I don't think any of the U.S. carriers has much money to play with these
days, but longer term, who knows.
Post by JF Mezei
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A Guy Called Tyketto
2010-01-21 09:33:06 UTC
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Well, the plot thickens.

http://travel-industry.uptake.com/blog/2010/01/16/jal-delta-skyteam/

Looks like JAL is taking the DAL/NWA deal, and dropping
OneWorld for Skyteam. No word yet on the fate of their long haul
aircraft.

An interesting tidbit from the article:

"Once the deal is made official, JAL and Delta plan to ask the
U.S. DOT for antitrust immunity by mid-February."

Anyone know what would cause both JAL and DAL to file for
antitrust immunity? Does AAL still operate their own aircraft to/from
RJAA, or was all of their Japan service via codeshare?

BL.
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JF Mezei
2010-01-21 10:49:11 UTC
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Post by A Guy Called Tyketto
Looks like JAL is taking the DAL/NWA deal, and dropping
OneWorld for Skyteam. No word yet on the fate of their long haul
aircraft.
"Once the deal is made official, JAL and Delta plan to ask the
U.S. DOT for antitrust immunity by mid-February."
I believe this is a "formality" whenever code sharing is done between 2
former competitors on routes. (exception to the "formality" is AA and BA).

BBC had mentioned "fleet renewall" a few days ago. Perhaps they will but
some 777-300s to replace the 747s.

On the other hand, if they streamline/combine flights between DL, NW
and JAL, perhaps they will need jumbo jets on enough routes to warrant
keeping the 747s (or perhaps buy 380s or 747-8s).


When Skyteam started, it was an "also ran" with little credibility. And
Oneworld was still riding high. But it appears that Oneworld has been
rather anemic while Skyteam has slowly built itself into something
fairly important.

There was even a period where Oneworld was snobbing some airlines (I
think it was Swissair which is now strongly within Star Alliance).

Seems to me that Oneworld is really not as important as it used to be,
especially since AA and BA have never gotten to the basics between each
other because they insist on using terms such as "merger" which scares
politicians into refusing them the antitrust immunity to do simple code
shares.
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Jeff Hacker
2010-01-22 01:25:02 UTC
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Post by A Guy Called Tyketto
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Well, the plot thickens.
http://travel-industry.uptake.com/blog/2010/01/16/jal-delta-skyteam/
Looks like JAL is taking the DAL/NWA deal, and dropping
OneWorld for Skyteam. No word yet on the fate of their long haul
aircraft.
"Once the deal is made official, JAL and Delta plan to ask the
U.S. DOT for antitrust immunity by mid-February."
Anyone know what would cause both JAL and DAL to file for
antitrust immunity? Does AAL still operate their own aircraft to/from
RJAA, or was all of their Japan service via codeshare?
BL.
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Web + NewsMaster, BOFH.. Smeghead! :) | http://www.wizard.com/~tyketto
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AA operates nonstop to Narita from DFW, ORD, LAX, and JFK, and previously
also operated service there from SJC. They have off and on also served KIX.
All on their own equipment (777's).
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JF Mezei
2010-01-22 08:21:16 UTC
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Heard on BBC that one reason why the JAL stock was still being traded
heavily despite the inevitable declaration of bankrupcy was that
supposedly, if you have 1000 or more shares of JAL stock, you are
allowed one trip per year at 50% discount (or something like that), and
with JAL stock down to a penny stock, it was a very good deal to buy
1000 shares for $60.00 would let you save far more on a long distance trip.

Not sure if this is true and what the details were on this, and how long
this deal would last. (supposedly, the JAL shares will be delisted in
February, and likely be voided when JAL exists from bankrupcy reorg and
new shares issued.

Back when JAL stock was at 300 yen (roughly $30), you needed a $30,000
investment in JAL to benefit from that deal.
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Robin Johnson
2010-01-23 06:02:02 UTC
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A couple of points:
Narita is for Delta and has been for Northwest a major hub for
international connections between North America and other ports
in Asia. This is true for JAL also, but it has not been very useful
for connecting to or from domestic Japanese flights, nearly all of
which operate from close-in Haneda.

Now that slot pressure is coming off at both airports, with new
runways constructed, the average size of aircrsft will likely
decrease, and the number of points served will likely increase,
regardless of what happens to JAL..

JAL has many orders for Boeing 737 models outstanding, so
presumably intended to replace widebodies with more frequent
737 services on many routes. It seems likely that both major
Japanese carriers and others will fly more international flights
from Haneda, though it will be necessary to expand the tiny
international terminal.
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