willzzz88

I agree. In this case I believe its trying to save "face" and gauge media attention. This seems an interesting strategy of having back-room negotiations and using the media to your advantage. I have a feeling JAL may win with AMR in the end (or else AMR has no Asia partner, the alliances are unbalanced, etc.) due to AMR having a limited Asia network itself. JAL was initially unhappy because if I remember correctly the correct Oneworld relationship between JAL and AMR was only codeshares and not revenue sharing. After bankruptcy JAL would probably deepen its relationship with AMR and do revenue sharing ala Skyteam/Star Alliance.

Schwanker

Anyone else notice how DAL and AMR stocks fared on Friday?

AMR +5.49%
DAL -1.40%

I'm guessing some insiders may know something driving the stocks opposite directions.

johnso29

He wasn't quoted. No reason to move on.

These are the games they play. The Japanese aren't in a hurry. They never have been. They're patient, & smart. Standby for more.

AAflyer

WOW, at least this biz is not dull and boring!

TOKYO (Reuters) - Japan Airlines Corp (Tokyo:9205.T - News) will keep its partnership with American Airlines (NYSE:AMR - News) in the Oneworld alliance and end talks with Delta Air Lines (NYSEAL - News) and the rival SkyTeam group, the Asahi newspaper reported.

The two U.S. carriers have been courting Japan Airlines for months with offers of financial aid and close cooperation on international routes, looking to gain access to its vast network in Asia and benefit from the expansion at Tokyo's Haneda Airport.

JAL had been leaning toward joining hands with Delta before filing for bankruptcy last month and bringing in new management under the auspices of a state-backed fund, the Enterprise Turnaround Initiative Corp of Japan (ETIC).

JAL's new chief executive officer, Kazuo Inamori, and officials of the ETIC have decided that switching alliances is too risky and could hinder their ability to turn around the airline quickly, the Asahi said on its website.

JAL will make an official announcement this week, the Asahi said. A JAL spokeswoman declined to comment. No one at the ETIC could be reached for a comment.

In addition to the burden of upgrading computer systems and other costs, the risk that JAL and Delta would not be able to receive regulatory approval for anti-trust immunity also played into the decision, the Asahi said.

Anti-trust immunity allows airlines to work closely on pricing, flight scheduling and in other areas to boost revenue and lower costs. This is now a possible under the "open skies" treaty recently agreed to by the United States and Japan.

American and its Oneworld partners have offered $1.4 billion in capital and Delta has offered about $1 billion in financial aid in an effort to woo JAL. However, the ETIC is not expected to invite another carrier to invest in JAL at this stage.

DAL330drvr

Someone posted it on the DALPA forum.

acl65pilot

They have one trust me. That will come out too!

As for this, JAL has their say, but the Trustees are the ones with final say. They have to be in place bt NLT the 19th. It may not be over yet, but if it is, JAL will rue the day they did not do this deal. I see DAL making life very miserable for them.

Jughead

So what are some ways we can spend the extra billion now?

Lighteningspeed

It wasn't clear whether he was quoted or not. I, along with every other person would agree Japanese are smart but I disagree with you that they are patient. I don't know what gave you that impression about the Japanese. Chinese are the ones known to be patient and they make their every move after a careful deliberation. Japanese, on the other hand are known to make recklessly hasty moves based on their overconfidence. Case in point Pearl Harbor attack in 1941. Over 60 years ago for sure, but it's in their national culture. Anyone who has spent anytime in Japan would have noticed that trait in the Japanese culture.

It's going to be interesting to watch this as it unfolds.

Lighteningspeed

I have no doubt DAL has their next business plan in place in case JAL stays with AA. I agree that trustees will make the decision for JAL in the final account. I also agree JAL would be making a big mistake if they do not select DAL. According to ETIC calculation, joining Skyteam Alliance would give JAL roughly $1.4 billion more during a 5 year period versus remaining with AA. However, I think JAL is wary of signing up with DAL for various reasons.

Sink r8

It always sounded as thought there were factions within the ETIC that favored AMR, and that the Ministry of Transportation, and the previous JAL CEO, favored DAL.

I find it rather suspicious that the new CEO, so soon after his appointment, would undo the rumored "basic agreement". That might suggest either that a) this is for internal consumption, to make sure the JAL employees feel warm and fuzzy about their leadership fighting outside influence before having to bow to outside influence from the ETIC, b) this is to negotiate further, or c) this tells you the ETIC more strongly favored AMR, and they got their man in position.

Either way, I learned from our UsAirways rape attempt that the creditors hold the power, and they eventually get someone in place that will work for their long-term interest. In our case, it was stock price, via a clean balance sheet, and a merger. Not necessarily the NW merger, but a merger nonetheless.

Another way to look at this is that the Japanese government is so closely intertwined, that they couldn't conceive the US would not clearly telegraph ATI approval in advance. Maybe they didn't get the guarantees they hoped for, and now they'll go for what looks more secure.