Japan may aid JAL as airline struggles

October 21, 2009 - 0 comments

Tokyo -- Top ranking Japanese officials said the government might have to use public funds to keep struggling Japan Airlines Corp. from going bankrupt.

JAL expects to lose $2.19 billion in its 2009 fiscal year, the Japan Times reported Wednesday.

In response, Transportation Minister Seiji Maehara and Finance Minister Hirohisa Fujii met with JAL executives and later said the company's restructuring plan included government assistance.

A finalized plan would be ready "within the next several days," Fujii said.

Maehara had previously emphasized the need for the airline to manage on its own, but said after the meeting that "public support has already been provided," referring to a previous loan of $1 billion that had government support, albeit during the previous administration.

JAL has already asked creditors for $3.2 billion and is considering selling two hotel chains, Nikko Hotels International and Hotel JAL City, the newspaper said.