Japan Airlines Corp., Asia’s largest airline by sales, is extending unpaid leave to cabin attendants and other staff until September as the biggest drop in overseas travel since 2003 pushes it to a second straight annual loss.
The airline granted unpaid leave to about 55 employees this month and another 100 next month and is accepting applications for August and September, spokeswoman Sze Hunn Yap said Friday in Tokyo. She declined to give a cost-saving estimate.
Japan Airlines, Singapore Airlines Ltd. and Cathay Pacific Airways Ltd. have all offered unpaid leave as tumbling demand leaves them with surplus staff. JAL is targeting ¥53 billion in cost cuts this fiscal year in anticipation of a ¥63 billion loss.
“Businesses are still restricting travel and demand is slumping,” said Osuke Itazaki, an analyst in Tokyo at Credit Suisse Group. “JAL has no choice but to offer unpaid leave.”
The airline suffered a 7.5 percent drop in international passengers in April. Fliers tumbled 12.4 percent in the year that ended in March, the biggest drop since the year to March 2004.
JAL has given unpaid leave to about 925 workers this year, including this month and next. Singapore Air, the world’s biggest airline by market capitalization, has granted unpaid leave to almost 2,000 employees, spokesman Nicholas Ionides said.