Japan Airlines Commences Direct Flight to Melbourne

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Japan Airlines Commences Direct Flight to Melbourne

Japan Airlines Commences Direct Flight to Melbourne. The Japanese flight carrier became the first Japanese company to operate direct flights between Narita International Airport and Melbourne on Friday as the company began to make bolder business decisions seven years after its bankruptcy.

"We expect to capture demand for both business and tourism," said JAL President Yoshiharu Ueki in Narita, a gateway to the Tokyo Metropolitan Area. The inaugural flight, which was received by a bow of water from the fire trucks before takeoff, had 99% of its seats filled. The airline will operate a return trip to Melbourne every day.

The Australian city attracts many tourists because of its proximity to a number of national parks, and also attracts many business travelers, mainly in the resource sector.

Australian airline Qantas has even taken Narita-Melbourne flights initially launched in 2014 by its low-cost subsidiary, Jetstar Group, in order to directly operate the promising route.

"The passenger occupancy factor," a measure of seat occupancy, "will certainly reach 80%," Ueki said of the new JAL route.

The Japanese flag carrier filed for bankruptcy in 2010, and has since been rehabilitated with the help of the government. The company has managed to significantly improve its profit structure during this period, and its operating profit margin is now solidly in double digits.

A new beginning

In April, the Ministry of Land, Infrastructure, Transportation and Tourism lifted restrictions on JAL in relation to new investments and routes.

In addition to the Narita-Melbourne route, the airline is planning new flights between Narita and Kona, Hawaii, and between Tokyo's Haneda Airport and London. JAL aims to serve more routes that primarily cater to business travelers, and regain its status as a leader in tourism-driven travel.

But "we have limited resources, and we can not push our crew too much," Ueki said. JAL only plans to add five new aircraft to its fleet between March and fiscal year 2020, bringing its total to 231. Compatriots ANA Holdings, on the other hand, is planning an increase of approximately 30 units to a total of 300 at end of that fiscal year.

Profitability was a key concern throughout JAL's rehabilitation. In order to utilize your workforce and equipment in the most efficient way possible, you are still committed to the concept as you look at new routes.

The carrier discarded 65 routes, or 30% of the total, in the eight years until last March. He also plans next March to cancel flights between Narita and Incheon International Airport in South Korea, where he has been losing money even when fully booked in the middle of competition from budget carriers.

JAL's bankruptcy was caused by its seemingly limitless campaign to expand, rooted in part in the company's accustomed relationship with government and bureaucracy. The carrier was urged to run flights to each new remote, barrel-hogged airport at home, regardless of actual demand. Even abroad, JAL developed close links with politicians and local governments.

At one point, a Foreign Ministry was proclaimed more than the Ministry of Foreign Affairs. So far, there is no indication that the new JAL is returning to its old ways, but that is a possibility as it starts to launch new routes again.

The rivals anticipate greater competition from JAL. ANA is actively pursuing new investments to consolidate its position as the leading Japanese company, such as buying a stake in Vietnam Airlines and building a new employee training center.

If low-cost carriers are also involved, customers could benefit from lower rates and better service. Ueki faces its next test as JAL moves ahead of its rehabilitation phase for sustainable growth.
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