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Business

Domestic, foreign airlines eyeing tie-up with Skymark

TOKYO -- Japanese and foreign carriers are making overtures to help troubled Skymark Airlines get back on its feet, hoping to gain access to lucrative routes out of a central Tokyo airport.

     Skymark controls 36 daily takeoff and landing slots at Haneda Airport, or 8% of the total -- coveted services that rival airlines are eager to get their hands on. The company will choose multiple sponsors early next month, with ANA Holdings, Malaysia's AirAsia and others vying for a single sponsor airline spot.

     Perceived front-runner ANA presented a proposal Monday that includes a capital investment as well as wide-ranging partnerships from flight operation to maintenance. With rival Japan Airlines having dropped out, ANA could bolster its position through joint services.

     But ANA could essentially end up supporting its future competitor. If it gets picked, the Transport Ministry will likely require that the airline divest from Skymark once the rehabilitation is complete to maintain market competition. Skymark, the country's third-largest carrier, has stayed independent of the two industry leaders so far and played a key role in driving price competition.

     AirAsia had mulled a comprehensive capital and business tie-up before Skymark filed for bankruptcy protection. The fast-growing low-cost carrier did not offer an investment this time but is proposing to use Skymark's midsize Airbus A330 planes for its own international routes. It could also mediate the resale of the A380 superjumbo jets that the troubled airline ordered but can no longer afford.

     Delta Air Lines is interested in a business tie-up, particularly in routes connecting the Tokyo metropolitan area to other regions in Japan. It would mark the U.S. carrier's first flight partnership with a Japanese airline.

     Global leader American Airlines will be soon sending executives to Japan to discuss a possible tie-up, including investment.

     Skymark is expected to look at a sponsor's ability to purchase planes. Airbus is demanding that the carrier pay a $700 million cancellation fee for the superjumbos and could end up as the company's biggest creditor.

(Nikkei)

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