Japanese domestic recovery boosts outlook for JAL, ANA
Japan’s two major airlines are preparing for a rapid rebound in domestic travel following the easing of the country’s COVID-19 restrictions. International operations continue to lag, however, putting pressure on the airlines’ recovery prospects.
The arrival of the Delta variant of COVID-19 in mid-2021 hit Japan’s domestic market hard. While this wave has now subsided, it has set back airline recovery timelines significantly. Short-term financial prospects have been downgraded, although the carriers still see hope for financial improvement on the horizon.
Both All Nippon Airways and Japan Airlines have revealed plans to reduce their workforces in coming years. This is the latest example of how the carriers have had to adjust their fleet and business strategies for the post-pandemic environment.
All airlines have had to do this, but the shift in long-term approach is particularly notable for ANA and JAL. Just before the pandemic they were preparing to ramp up growth plans to align with the government’s ambitious targets for international tourism increases. Now it is evident that these goal will not be achievable for some time.
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