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TOKYO: Troubled Japan Airlines (JAL) is expected to cut 15,600 jobs, or about 30 per cent of its group workforce, in three years under a rehabilitation plan, a report said on Monday.
The layoffs, coupled with cuts in benefits and wages, will be carried out together with the sale of JAL's subsidiaries including JAL Hotels Co., Kyodo News reported citing unspecified sources.
The carrier's workforce will be trimmed to about 36,000 by the business year to March 2013, the report said.
The state-backed Enterprise Turnaround Initiative Corp. (ETIC) plans to decide on its bailout package for JAL as early as January 19, the same time the airline is expected to file for bankruptcy protection, Kyodo said.
The ETIC estimated the liabilities of Asia's top carrier exceed its assets by more than 860 billion yen (US$9.5 billion), Kyodo quoted the sources as saying.
It plans to reduce JAL's liabilities by 730 billion yen through the court-backed bankruptcy, the report said.
It will also invest 300 billion yen in JAL so the carrier's assets would exceed its liabilities by more than 160 billion yen, the report added.
Even after the bankruptcy proceedings, the state-backed body will guarantee more than 470 billion yen for payments of fuel and other commercial transactions necessary to keep JAL flying, the report added.
The company's creditor banks will be required to waive about 350 billion yen, out of an approximate 430 billion yen in unsecured bank loans, Kyodo quoted the sources as saying.
The ETIC estimated JAL's consolidated operating loss to expand to about 265 billion yen for the current business year to March 2010, compared with a year-earlier loss of 51 billion yen, due to a drop in passenger numbers.
Through restructuring measures under the ETIC's rehabilitation plan, JAL will aim to achieve 116 billion yen in operating profit by the year to March 2013, the sources said.
- AFP/sc
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