January 19, 2010
Japan Airlines has gone bankrupt, with $26-billion of debt in one of the country’s biggest-ever corporate failures, beginning a painful overhaul involving more than 15,600 job cuts.
JAL, a once-proud flag carrier now worth less than a jumbo jet, reassured passengers its flights would not be interrupted during the bankruptcy, which is similar to the process used to revive ailing U.S. auto giant General Motors.
Asia’s biggest airline, which carries more than 50-million passengers every year, will slash 30 per cent of its workforce and receive almost $10-billion of public funds and emergency loans under a three-year turnaround plan.
JAL said it aimed to “be reborn as a leading airline group”.
But transport minister Seiji Maehara warned the government would not keep bailing out JAL indefinitely, saying it would have pulled the plug on the group if it were not such an important company.
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