Japan Airlines will have to reform its operation in return for a government rescue loan. Finance Minister Kaoru Yosano has all but confirmed that the government will bail out the unprofitable company. Justifying his thinking, the minister describes Japan Airlnes in terms of its value as a public service, rather than as a company operating in a competitive market. But government help would be available only if the airline agrees to restructure itself, he said.

Even as airlines are calling on manufacturers to get started on the next-generation of narrow-body jetliners, the first of those projects is already more than a year into development. With propulsion, structural and systems technologies at least a generation ahead of those in the Boeing 737 and Airbus A320 family, the aircraft should offer a leap in efficiency.

Shanghai Airlines will continue as a separate business with its own brand after China Eastern buys the company, at least initially. Now well into the process of executing the state-directed takeover, China Eastern confirms that neither it nor Shanghai Airlines — both of them unprofitable and both based at Shanghai — will cut staffing in the restructuring. A due diligence check on Shanghai Airlines has begun, and China Eastern Chairman Liu Shaoyong is leading a group of executives negotiating with the target.