Struggling Japan Airlines Corp. is considering receiving capital investments from Delta Air Lines Inc., the world's largest airline, and forming a tieup on international operations with the U.S. carrier, industry sources said Friday.
Japan's largest airline is also sounding out Air France-KLM Group, Europe's top airline, on expanding its alliance in deals that could form the pillar of JAL's restructuring program and dramatically alter the makeup of the global airline industry.
JAL is likely to raise tens of billions of yen by selling shares to Delta, which would become JAL's top shareholder, the sources said.
The company will also improve the efficiency of its flight operations by code-sharing international routes with Delta and strengthening its business base, they added.
It also hopes to avert an exodus of travelers by jointly operating flights with Delta as JAL plans to drastically suspend loss-making international flights to cut costs.
Delta and Air France-KLM are both part of SkyTeam, a global airline alliance, while JAL is part of the rival Oneworld grouping that includes American Airlines and British Airways. JAL is reportedly looking to exit Oneworld.
In June, JAL inked a deal with two state-backed lenders and three major Japanese commercial banks to borrow a total of ¥100 billion and plans to receive another ¥100 billion in additional loans before the end of the year.
The Japanese airline will present an outline of its new management improvement plan to a panel to be convened next Tuesday by the Ministry of Land, Infrastructure, Transport and Tourism.
JAL's group net loss for the current business year through next March is expected to widen from an initially anticipated ¥63 billion as travel demand continues to be pounded by the economic downturn and the spread of the new influenza.