Cash-strapped Air Do and Australian aircraft leasing firm Ansett Worldwide signed a deal Tuesday that will cut leasing fees for two aircraft by 30 percent.
The discount will reduce costs for the airline, formally known as Hokkaido International Airlines, by more than 1 billion yen in the 2002 business year.
Attention will now shift to whether Air Do will succeed in concluding a tieup agreement a with major airline to secure future profitability.
Air Do has been in talks with Japan Airlines on a possible tieup as JAL has been providing maintenance services to its aircraft since 1998, when it launched its one-way Tokyo-Sapporo service for just 16,000 yen -- 36 percent lower than other airline's regular prices at the time.