Struggling Japan Airlines Corp., following recommendations made by a task force of the transport ministry, has given up trying to reconstruct itself on its own and has put itself under virtually direct state supervision. Specifically, the Enterprise Turnaround Initiative Corp. (ETIC) of Japan, which began operating in October, will take the lead in resuscitating the airline. The government will establish a "headquarters" that includes Cabinet ministers concerned with helping JAL out of its crisis.
Pointing out that JAL flights account for about 60 percent of the flights in Japan and that, if JAL cannot fly, it will cause big problems for local economies, Japan as a whole and ties with foreign countries, transport minister Seiji Maehara stressed JAL's strong public character.
A reconstruction plan worked out during the days of the previous Aso administration was scrapped. With the new approach, the Hatoyama administration's ability will be tested. Since a large amount of public money is likely to be used, the government needs to fully explain to people JAL's situation and the measures the government plans to take. Public understanding is indispensable.