There are no official announcements, but the latest word in the Japanese press is that JAL is considering slashing over 50 domestic and international routes that it deems to be unprofitable by the end of its fiscal year (March 2011). It’s a big rise from the 30 routes JAL said it would need to cut earlier this year. Routes News offers a perspective on the possible impacts across its network.

JAL pledged its future to oneworld in February, despite much courting from the Skyteam alliance and now faces a continuous battle to rationalise its network in order to help reduce its huge losses. Which routes could go?

The Hub takes a look at JAL's scheduled international network, which operates from four bases in Japan:

(Source: Flightbase, June 14-20 2010)

According to reports circulating in a number of Japanese newspapers, the following international routes are among those at risk of cancellation (citing the information from an unnamed airline source): San Francisco, Amsterdam, Rome and Milan (from Narita) and Bangkok, Beijing, Hong Kong and Guangzhou (from Kansai).

What are the implications of increased cancellations across JAL's network?

The cancellation of loss-making international routes on such a scale is a strong reflection of the number of weak or subsidised routes the carrier has been operating. It also shows the pressure on shareholders and lenders to cut costs and return the airline to profitability. Many route cancellations probably coincide with the termination of aircraft leases. This is a wise move as a considerable proportion of JAL's fleet is due for replacement and it would make no sense to renew leases on 747-400s when the market is steadily moving to the B777 and A330 models.

JAL will come under considerable political pressure to resume some domestic sectors as some provincial towns will be badly affected by the route cuts. On the other hand, there is also a very competitive high-speed rail network to accommodate some transfer of traffic from air to rail. But, at the same time, there are some very long distance domestic sectors for which travelling via rail is not an adequate replacement.

What is clear is that there is not a lively low-cost market to fill the void left by JAL. Fukuoka would be seriously affected by the network cuts, where JAL has a 30% share, as well as Kansai, where JAL has a 23% share of all flights (according to flightbase, June 14-20 2010).

Whatever the outcome, Narita and Haneda will continue to be focuses for JAL - perhaps with a focus on serving domestic trunk routes from Haneda (historically a domestic airport). The metropolitan airport is trying to become a 24-hour international operation and will open its fourth runway towards the second half of this year. Last month, a JAL Spokesperson told Routes News: "The internationalisation of Haneda Airport provides a great business opportunity and we intend to maximise the use of its expanded facilities. Haneda will see a lot of traffic and it will be a highly-used airport given its close proximity to central Tokyo. This convenience will be attractive to business travellers on short-haul Asian routes, which we hope to operate using day-time slots at Haneda."

As for Narita, JAL will still maintain a focus on established routes to the Americas, Europe and South East Asia, according to the spokesperson.

In the meantime, JAL will continue working with Oneworld partners to squeeze up revenues through codesharing, rather than flying their own metal to unprofitable points. It is this promise of new revenues that has helped to sway JAL into maintaining its partnership with the oneworld alliance.

JAL and American Airlines have applied to the US Department for transport for antitrust immunity in order to try and compete more effectively with SkyTeam on the Japan-US sector. Our JAL Spokeperson added: "We value how JAL and American Airlines - whose hubs at Chicago and Los Angeles are also two of JAL's major USA gateways, can further complement each other should we enter a Joint Business Agreement with the approval of our application."

JAL's immediate problem, however, is that it needs to invest in new equipment and it certainly has not got the finances to permit this at the moment.

Read our full interview with Narita Airport's CEO in issue 2 of Routes News magazine.