12-Jan-2011 9:43 AM

JAL and American Airlines announce launch of joint business from Apr-2011

Japan Airlines and American Airlines announced (11-Jan-2011) plans to commence their joint business from 01-Apr-2011 based on the expected start of revenue-sharing on applicable trans-Pacific flights. The airlines are using a phased approach to bring in the cooperation, with key benefits being improved flight schedules, codesharing, more coordinated services and greater access to a wider variety of fares. The carriers' stated the total value of the joint business package would be in the region of USD156 million in the first full year of implementation. JAL added that the agreement will increase the struggling carrier's competitiveness by reducing costs and increasing profitability. Meanwhile, American Airlines President Tom Horton said the agreement signalled the carrier is "preparing for the next decade” which is "likely to see growth in air travel between North America and Asia”. Additional consumer benefits over the coming months are expected as the cooperation level deepens between the two airlines. Further details include:

  • Scope of joint business: The joint business will apply to non-stop flights on 10 routes initially covering Japan Airlines' services from Tokyo Narita to New York, Chicago, Los Angeles and Vancouver and from Tokyo Haneda to San Francisco, and American Airlines' operated services from Tokyo Narita to Dallas/Forth Worth, New York, Chicago and Los Angeles, from Tokyo Haneda to New York, from Beijing to Chicago (subject to approval), and from Shanghai to Chicago and Los Angeles (subject to approval). Connecting services from these trans-Pacific services will be offered by JAL Asia on domestic Japan routes and on American Airlines' services in Canada, Mexico, Puerto Rico, US Virgin Islands, domestic points within US, excluding Hawaii. The coverage will be expanded upon obtaining the required approval from authorities of third-party countries to add routes linking destinations beyond Japan and North America;
  • Benefits for Japan Airlines/American Airlines: The carriers’ plan to share revenue generated from operations over the Pacific from 01-Apr-0211. The airlines will also maximise synergies to increase operational efficiency and productivity while reducing costs. The carriers also expect operational efficiencies to be gained from co-locations at airports, offices and joint lounge operations. Cross-selling on their websites is expected to further increase exposure and sales opportunities for the two brands;
  • Codesharing/mileage programme: The carriers will align their 2011 summer schedules to reduce connection and overall travel, create an enhanced choice of flight times and increased connection opportunities. With the latest announcement, the carriers will codeshare on 123 routes with this to be continually expanded under the agreement. The carriers will also receive reciprocal benefits on their respective mileage programmes and lounge access;
  • Benefits for corporate customers/travel agents: The carriers will offer more coordinated pricing and programmes;
  • Co-locations: Japan Airlines will also co-locate in American's Terminal 3 at Chicago O'Hare International Airport effective 27-Mar-2011 to further enhance compatibility of services. Through timetable and service adjustments, the carriers will offer 44 flights from 42 points in North America to connect on Japan Airlines' Chicago-Narita flight within two hours of arrival into Chicago. This is an increase of 22 flights and 20 destinations;
  • Joint operations will also focus around Dallas/Forth Worth, Los Angeles, San Francisco and New York. Meanwhile, American will relocate its Asia Pacific Regional Office in Tokyo to Japan Airlines’ headquarters from 17-Jan-2011. In New York, Japan Airlines moved its administration office into the same building as American in Oct-2010;
  • 2011 summer schedule alignment: From 27-Mar-2011 for JAL and 05-Apr-2011 for American Airlines, the carriers will align their 2011 summer scheduled to result in reduced connection and overall travel times, a better choice of flight times and increased connection opportunities to destinations beyond gateway cities;
  • Shareholder benefits: Stakeholders, business partners, and employees are expected to benefit from the trans-Pacific joint business from the anticipated improved financial position and stability of the airlines, reduced costs and increased competitive position;
  • Premium economy product: The two airlines plan to jointly sell Japan Airlines' premium economy product which will provide American's customers with a new travel option;
  • JAL/American relationship: Over the past several months the carriers have deepened their relationship, which began more than 15 years ago, by sharing best practice. [more - JAL/American] [more - Oneworld] [more - Perspective]

oneworld: "Japan Airlines is a highly valued member of oneworld and all of us throughout the world's premier alliance are committed to working more closely with JAL as it establishes itself as an even stronger airline and partner, for the benefit of our customers, employees and all stakeholders. The rapid progress we have achieved so far is testimony to oneworld's commitment to Japan and Japanese customers. We are confident that in an increasingly alliance-focused airline industry, Japan Airlines' renewed approach to oneworld and its partners, and the impending launch of its joint business with American will significantly further strengthen oneworld's competitiveness, and place us in a better position to contend for a bigger piece of market share over the Pacific," Bruce Ashby, CEO. Source: Company Statement, 11-Jan-2011.

Japan Airlines: "With our complementary strengths, the Japan Airlines-American team is well positioned to pursue further service enhancements for our customers and greater synergies for our businesses. Japan Airlines is strongly committed to our corporate revitalisation, and I am confident that this joint business will raise our competitiveness in this vital region, improve our profitability and aid us in achieving our goal," Masaru Onishi, President. Source: Company Statement, 11-Jan-2011.

American Airlines: "We firmly believe our joint business will benefit all stakeholders – our customers, our financial partners, and our employees. Japan Airlines has been an excellent partner, and together, we are preparing for the next decade – a decade that is likely to see growth in air travel between North America and Asia," Tom Horton, President. Source: Company Statement, 11-Jan-2011.

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