JAL chose AA out of immediate survival. Their preference long term was Delta.

The DL/NW Tokyo HUB is invaluable. It allows it to do two things. Pick up local business traffic from the world’s 2ed largest economy, and launch non-stops from the US.

Two paths to profit instead of one…No other US airline (including UAL) can touch that jewel. That’s like saying “overfly LHR, vs. doing both”

Delta is hyper competitor Northwest in sheeps clothing.

JAL will be lucky to survive facing the bare teeth of DL/NW AND UAL/Star.

A MERGER means the new entity becomes a new company not an old one with the same management in place.

NW (now using the Delta name because of financial reasons) is the pro in Asia, JAL knows that (having had it’s operation set up by NW in the 1950’s).

My money is on a JAL-DL hook-up. (that NW name carries a helluva lot of weight in Asia)

Doug Swalen wrote:
Didn’t you leave off a few other NRT-Asia markets?

I should have known that simply looking at Delta’s timetable wasn’t good enough. I mean, why would Delta bother listing all Northwest flights?!? (Sorry, that bugs me.) Delta has been trying to kill the Northwest brand as quickly as possible, but I see I still need to download a Northwest timetable to see all their flights. I knew it seemed small, but I just assumed that’s where it was.

Thank you.

Doug Swalen wrote:
For intra-Asia flying, this is what is currently in the schedule from Tokyo:
Guam – 7 weekly 757, 5 weekly 767
Ho Chi Minh City – 7 weekly 757
Hong Kong – 7 weekly A330
Taipei – 7 weekly 757
So it is mostly downgauged to 757s.

Didn’t you leave off a few other NRT-Asia markets?
Manila – 7x 744
Singapore – 7x 332
Bangkok – 7x 757
Osaka(KIX) – 7x 757
Seoul(ICN) – 7x 757
Busan/Pusan – 7x 757
Beijing – 7x 332
Shanghai – 7x 332
Saipan – 14x 757
And within Japan they do at least NRT-KIX 7x 757 and NRT-NGO 7x 757

I follow a NW pilots blog who flys 757’s and enjoy his little 13day trips around NRT-Asia on 757’s. Nice commute to work, east coast USA to NRT as a non-working crew member. And I thought 2+ hours from Orange County to work in downtown Los Angeles took forever……lol

I know this is (barring the Alitalia talk) a more US-central blog, but that we’re on that topic of Asia…any chance we could get your
insight into Air China upping its stake to 30% of Cathay?

Stephen – Though it may be US-centric by nature, I always like talking about things that happen around the world as well. The Air China move is a really interesting one, but I don’t quite know enough about the politics over there to know what to make of it.

Air China long-term would like to own the airline (Swire’s resistance notwithstanding), and I really have no idea what that would mean for *A and OW consequences in the region.

It seems to me that with Air China (Star) and Cathay (oneworld) growing closer, they will eventually have to make a choice. Cathay is the stronger brand and is also more important to oneworld than Air China is to Star. So they might want to shift over to oneworld. If that happens, I would think China Eastern would then run away from its relationships with oneworld partners and go to Star. They just bought Star Alliance partner Shanghai Airlines, so it would be a somewhat natural fit.

I wonder if Continental’s immediate departure from SkyTeam is partly prodding Delta into action?

I doubt it. I bet Delta is jumping into action because of the Northwest acquisition. Either they found a route system in Tokyo that was bleeding or they don’t quite know how to run it. Either way, they want Tokyo strength on top of the existing Northwest strength they have there. At least, that’s my guess.

Nicholas Barnard wrote:

Interesting. I wonder does Japan have airline ownership laws like the US? Perhaps Delta could buy it outright in conjunction with AF/KLM.

It looks like it’s a bit more liberal but not that liberal. If this post is to be trusted, foreign airlines can own up to one third of JAL.

Zack Rules, Albany, NY wrote:

“[intra-Asian] routes absolutely suck wind right now”
I politely disagree. I don’t think Delta’s losing tons of money on a majority of it’s intra-Asian routes. They’ve downsized some flights but I think if they were really losing a lot of money, you would see a lot more 757’s, 767’s and 777’s operating there rather than A330-200’s, A330-300’s and 747-400’s.

For intra-Asia flying, this is what is currently in the schedule from Tokyo:

Guam – 7 weekly 757, 5 weekly 767
Ho Chi Minh City – 7 weekly 757
Hong Kong – 7 weekly A330
Taipei – 7 weekly 757

So it is mostly downgauged to 757s.

Also, the Tokyo hub was a major reason for buying Northwest.

I don’t think they care about the intra-Asian stuff but rather the ability to greatly increase their Asian presence. This would help them strengthen the Tokyo operation through partnering.

The Traveling Optimist wrote:

1) What would the DOT have to say about the largest US carrier teaming up with the dominant Japanese airline?

It shouldn’t be a problem. I bet we’ll see the American/BA deal approved and this shouldn’t be as contentious as that would be.

2) Transferring valuable assets (slots) back to Japan short of the pending bi-lateral would also not necessasrily be looked upon favorably by the US or those airlines wanting access to Japan even in this economy.

The US doesn’t have a say in this. Delta can’t give those slots to another US carrier. IIRC, slots aren’t transferable, but Japan has allowed it to happen if the slots go to Japanese carriers.

2) Transferring valuable assets (slots) back to Japan short of the pending bi-lateral would also not necessasrily be looked upon favorably by the US or those airlines wanting access to Japan even in this economy.

d) AA brings little to the overseas flying which is what JL might be interested in in terms of protecting their own traffic. AA can pay to keep them afloat, they’ll “strengthen” the alliance and still keep the lion’s share of the Transpac market.

e) Anti-trust? To Japan? I laugh.

I’ve read that they would like Haneda access which I find interesting. Whether they would split their Narita hub between the two airports (terrible move and I doubt they would do that) or move all of their flights to Haneda, I don’t know. The legal framework for that is very murky but it should be cleared up with the advent of an Open Skies agreement.

Ultimately, I think this situation has some similarities with Delta and Pan Am in the early 90’s. My guess is Delta’s going to attempt to get a full codeshare and maybe a JV, more slots at either Narita (more likely) or Haneda and would maybe help them restructure more, drawing on their own experiences. I don’t think they’ll give up intra-Asia flying because of Japan Airlines’ instabilities. Also, the Tokyo hub was a major reason for buying Northwest.

I don’t really see what American Airlines brings to Japan Airlines other than a JV. I don’t see where AA gets the cash to invest in such a risky proposition with further compromising their own liquidity issues.

Anyhow, great post and keep it!