(Corrects to say interview was with CEO of ANA’s airline unit in seventh paragraph of story first published yesterday.)
June 3 (Bloomberg) -- Japan Airlines Co. said the release of new operating slots at Tokyo’s Haneda airport has created a capacity glut that’s likely to persist for another 18 months, weighing on average fares and earnings.
“There was a large increase in the supply, and demand has not kept up at this point in time,” Chairman Masaru Onishi said today in an interview in Qatar. “The same happened for international flights. Hence we believe that for this fiscal year, business will be a little difficult for us.”
Excess flights at Haneda, which handles the bulk of Japan’s domestic and short-haul services, come as JAL seeks to improve its financial position after emerging from bankruptcy protection in 2011. The airline is “financially healthy” but will focus on improving its cash position and credit rating before boosting shareholder returns, Onishi said.
“When we are strong enough financially, we may increase dividends,” he said at a Oneworld alliance event during the International Air Transport Association annual meeting in Doha.
JAL is evaluating network expansion as it continues to take deliveries of the Boeing Co. 787, which has been a “game-changer” for the carrier, Onishi said.
The company will begin considering a requirement for smaller regional jets and propeller-drive planes in the “near future,” he said. JAL has about 10 Saab AB 340B turboprops.
All Nippon Airways Co. President Osamu Shinobe, who is also in Doha, said the major concern at Japan’s biggest airline is the yen’s loss in value against the dollar, a trend that has increased the relative cost of both jet fuel and aircraft, which are priced in the U.S. currency.
One dollar buys about 102 yen based on today’s prices. compared with 77.13 yen as of Sept. 13, 2012, the Japanese currency’s strongest level in the past two years.
To contact the editors responsible for this story: Benedikt Kammel at email@example.com Christopher Jasper