Flights On 52 JAL Routes Half-Empty Or Worse - Report

The average passenger load factor on more than one third of Japan Airlines Corp.'s (9205.TO) 151 domestic routes was less than 50% between April and July, The Yomiuri Shimbun reported in its Wednesday morning edition.

Citing sources close to the matter, the paper said the average passenger load on 52 of the airline's domestic routes fell below 50% during the period, and only 11 of the routes reached 70%, which is supposed to be the break-even point.

Observers say Japan Airlines Corp. will be forced to cut more routes than it is currently planning, as the latest findings show that even JAL's domestic operations, which are supposed to be the foundation of its business, are producing chronic losses.

Observers also say there will likely be stronger calls for a review of the government's special account for airport construction and maintenance.

Of the 52 routes, the passenger load was actually below 40% on seven routes--including those between Itami and Asahikawa, Itami and Matsumoto, and Sapporo and Akita.

JAL has already announced it will scrap 29 domestic routes by fiscal 2011. However, as the plan likely will leave many unprofitable routes intact, the paper said the government's task force for the reconstruction of JAL, is expected to make a full review of the airline's restructuring plan.

-Tokyo Bureau; Dow Jones Newswires; [phone]