Japan Airlines, considering forming a venture on European routes with British Airways, may also seek a similar tie-up with Air France to bolster operations on the continent.
"Our alliance with British Airways is the key," president Masaru Onishi said. "If we can cover all of Europe with them, which would include Iberia as well, then we won't need other joint ventures. If not, we'll look to other airlines."
JAL may also boost co-operation with other Oneworld members, including Finnair Oyj on European routes as it offsets cuts made to its overseas network during a government- backed restructuring. The carrier has already formed a venture with AMR's American Airlines that sets fares, sells tickets and decides schedules on transpacific routes to boost sales and pare costs.
"We want to build similar agreements in Europe to our North American one," Onishi said. The airline now flies to four cities in Europe, after halting flights to Amsterdam, Milan and Rome, as part of its turnaround. Onishi declined to say when he expected to reach an agreement with BA and other carriers.
BA and Iberia completed a merger this year, forming International Consolidated Airlines Group. All Nippon Airways has already agreed to a similar tie-up on European routes with Deutsche Lufthansa AG, which will come into effect in October.
Oneworld allows carriers to co-operate with airlines in different groupings, so Air France's membership in SkyTeam wouldn't prevent a tie-up, Onishi said. JAL codeshares on Air France flights to 13 cities.
"We could expand our business in Europe with Air France and KLM," said Onishi.
Air France-KLM owns the two European airlines. JAL's venture with American Airlines, which began in April, covers 10 routes between Asia and North America, . The carriers predicted a combined 13 billion ($200 million) in annual sales and cost-cutting gains from the accord.
"We've boosted our competitiveness on transpacific routes," Onishi said. "We've been able to improve co-operation and so we're moving to the second stage, which is making it stronger."
JAL last week reported operating profit of 17.1 billion for the three months ended June 30, an increase of 4.3 per cent from a year earlier. Tokyo-based All Nippon had a first-quarter operating loss of 8.1 billion after Japan's largest earthquake on record and ensuing nuclear disaster sapped travel.
- BLOOMBERG
