JAL raises number of retrenchments

Asia's biggest airline, Japan Airlines (JAL), announced a new business plan yesterday in which it will cut 5,900 jobs in three years and appoint a new chief executive officer.

Under the new plan, the 5,900 jobs would be cut by the end of March 2008, compared with a previous target for 4,500 job losses by March 2007.

JAL also said that president Toshiyuki Shinmachi, 62, would replace Isao Kaneko, 67, as chief executive officer.

"At this difficult juncture, JAL group will build a business structure that can produce profits in any environment," JAL said in a statement.

JAL also said it had raised its net profit forecast to ¥27 billion (US$257 million) for the year to March 2005 from its earlier estimate of ¥23 billion, as the effects of cost-cutting policies offset easier revenues.

The company revised down its sales forecast to ¥2.12 trillion from ¥2.13 trillion.

"Because of stagnant demand, our sales forecast is now lower than our earlier estimate ... but a cut in costs outpaced the sales decline."

Last month, JAL said it had returned to profit in the nine months to December although it suffered a net loss in the December quarter on rising fuel costs.

Compared with a few years ago, the business climate had improved as demand for overseas travel recovered from the impact of the war in Iraq and the SARS outbreak in 2003, it said.