Japan Air-ANA Fight for Haneda Slots Draws in American, United

Japan Airlines Co. (9201) and ANA Holdings Inc. (9202)’s fight over additional slots at Tokyo’s Haneda airport, Asia’s second-busiest, is widening to include global airline partnerships seeking access to fly businesspeople right into the heart of the city.

Haneda is set to gain about 40 new daytime landing slots for flights starting in March, Akihiro Ohta, Japan’s transport minister, said Sept. 20 in Tokyo. United Continental Holdings Inc. (UAL), which has teamed up with ANA, is seeking its first slot on its own while Delta Air Lines Inc. (DAL), the only major U.S. carrier without a Japanese partner, wants 25 slot pairs. American Airlines Inc. has a partnership with Japan Air.

ANA, Japan’s largest airline, is vying for a lion’s share of the roughly 20 new international slots to be distributed among local carriers, saying government support of Japan Air’s restructuring tipped the balance in favor of its rival. Rights to Haneda are important as business travelers will pay a premium to land near the city center instead of flying into Narita airport, about 40 miles east of Tokyo.

“Access to those slots is considered very important by the U.S. carriers,” said Peter Harbison, executive chairman at the Sydney-based CAPA Centre for Aviation. “It creates the obvious competitive advantages -- being close to the city and having desirable arrival and departure times.”

Haneda resumed regular intercontinental flights three years ago after opening a new international terminal.

Atlanta-based Delta has said it wants 25 slot pairs so it can return most of its flights to the airport after being forced to move them to Narita in 1978. It’s competing against United and American, which have flight-sharing ventures with Japanese airlines and benefit from the domestic carriers’ slots.

‘Piecemeal Offers’

Delta won two nighttime slots to Haneda in 2010, while American Airlines got one. Hawaiian Holdings Inc. (HA) also received one slot while United got none. A slot is the right to land and take-off a plane.

The ability of U.S. carriers to win slots at Haneda is hampered by government favoritism toward domestic carriers, Delta Chief Executive Officer Richard Anderson said in July.

“The U.S. should reject these unsatisfactory and piecemeal offers -- and permit no changes until Japan is ready to fully open Haneda and allow Delta to move its hub,” Anthony Black, a spokesman for Atlanta-based Delta, said in an e-mail.

The allocation of daytime slots may also prove more competitive than the nighttime slots three years ago, since the timings are more attractive to U.S. carriers.

ANA, JAL

“American has consistently raised concerns about the operational restrictions under which we fly between John F. Kennedy and Haneda, and that remains our focus,” said Mary Frances Fagan, a spokeswoman for the carrier. The time for its one flight between Haneda and New York, which leaves Tokyo at 6:55 a.m., isn’t attractive to business travelers, she said.

ANA says it needs more slots from Haneda after the government’s support during Japan Air’s restructuring.

“We can’t catch up with Japan Airlines’s finances and profitability by ourselves after the support it had under restructuring,” ANA President Shinichiro Ito said in an interview last month. “One of the few ways the government could help correct that imbalance would be to give priority over the new slots to us.”

Japan Airlines, the only other local airline that flies overseas from Haneda, was relisted on the Tokyo Stock Exchange last year after it wiped out shareholders and debts during bankruptcy as it was supported by 350 billion yen of government-backed financing.

The carrier had an operating profit margin of 13.8 percent, almost double ANA’s 7 percent in the year ended March, according to data compiled by Bloomberg.

“The slots are the property of the nation’s citizens,” JAL President Yoshiharu Ueki said in an interview last month. “They should be divided equally.”

Japan has been gradually increasing landing and take-off slots at Haneda since the opening of a new runway in 2010. It will add 30,000 international slots in the year ending March 31, bringing the total to 447,000 annually, according to the transport ministry.

To contact the reporters on this story: Chris Cooper in Tokyo at ccooper1@bloomberg.net; Kiyotaka Matsuda in Tokyo at kmatsuda@bloomberg.net; Mary Schlangenstein in Dallas at maryc.s@bloomberg.net

To contact the editor responsible for this story: Anand Krishnamoorthy at anandk@bloomberg.net; Ed Dufner at edufner@bloomberg.net

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