Delta Air Lines' proposed investment in Skymark clouds a possible joint venture with Korean Air

The debate in Japanese aviation over the future of bankrupt Skymark Airlines is as unusual as it is unpleasant - and perhaps ultimately uncontrollable. Skymark's largest creditor, lessor Intrepid, is publicly opposing Skymark's selection of All Nippon Airways to sponsor it out of bankruptcy. ANA has no plans to use the A330s that Skymark leased from Intrepid and CIT; the aircraft are in a highly customised configuration that other airlines do not want. Nor is ANA interested in Skymark's order for A380s, two of which have been assembled and represent the debt held by Skymark's two other main creditors, Airbus and Rolls-Royce.

Collectively these four parties account for 96% of Skymark's debt, well above the majority position needed to vote on a restructuring plan. The Japanese government finds itself lacking control after decades of actively orchestrating aviation policy. Another wrinkle: the investor Intrepid proposes for Skymark is Delta Air Lines, which has publicly - and rudely in the Japanese context - denounced Tokyo over Haneda airport liberalisation. For Delta, Skymark could help it start to win the Japan battle - but perhaps lose the Asia war.

Delta wants a joint venture with Korean Air, which is not convinced of the benefits. Korean Air is also sceptical of and sometimes disgruntled by Delta's flip-flopping commitment to having a hub in Japan versus Korea. Delta's push for Skymark is not as significant as its campaign a few years ago to woo Japan Airlines, but it will certainly do nothing to improve the Korean Air relationship.