• Kyodo

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Struggling Hokkaido International Airlines, better known as Air Do, plans to fly three daily round-trips between Asahikawa, Hokkaido, and Tokyo’s Haneda airport as early as July at a cheaper rate than major airlines, company sources said Thursday.

Air Do, now in the process of court-mandated restructuring under civil rehabilitation law, will begin negotiations next week with the Ministry of Land, Infrastructure and Transport, the sources said.

Under its rehabilitation plan, Air Do plans to expand its service, now limited to the Sapporo-Haneda route, to between other airports in Hokkaido and Haneda in or after 2005.

The Hokkaido Prefectural Government and the local business circle have been strongly pressing for the expansion after agreeing to give up all their invested equity stakes and waive their credits.

Against this backdrop, Air Do intends to expand its service earlier than planned to secure more slots at Haneda, the sources said.

But the ministry has expressed reluctance because the planned expansion will cost the carrier additional workforce and aircraft at a time when it is working to rehabilitate.

The Asahikawa-Haneda route is now being offered by All Nippon Airways, which is helping Air Do rebuild, and Japan Air System.

Meanwhile, Susumu Takizawa, former head of the Tokyo Regional Civil Aviation Bureau, will become the next president of Air Do, company sources said.

Takizawa, a former bureaucrat in the defunct Transport Ministry, will succeed Michimasu Ishiko. The ministry was a predecessor of the Ministry of Land, Infrastructure and Transport.

Air Do’s incumbent management team is set to resign en masse at an extraordinary shareholders’ meeting Jan. 27, the sources said.

Takizawa, 58, is currently chairman of the Japan Tourism Association.

The Development Bank of Japan and All Nippon Airways — the two major sponsors of Air Do’s rehabilitation scheme — will send officials as members of the new management team, the sources said.

A director of the government-affiliated bank is likely to become a vice president, and an ANA official is expected to become a board member, they said. ANA and Air Do are set to launch code-sharing flights on the Haneda-Sapporo route on Feb. 1.

Earlier, Air Do picked Masaaki Araya, a former Otaru mayor, as its new chairman. The post will be part-time.

Late last year, the DBJ, ANA, North Pacific Bank and 24 other companies launched a fund of some 2 billion yen to reconstruct the airline.

Air Do received 2 billion yen in the first batch of capital injection from the fund after reducing its entire 7.2 billion yen in capital.

The airline has decided to tap 100 percent of its capital to pay its debts.

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