Japan Airlines Corp. submitted its bankruptcy plans for approval on Tuesday, a restructuring plan that includes slashing roughly one-third of its workforce and cuts unprofitable domestic and international routes.
The struggling airline revealed that it will reduce its workforce by 16,000 employees, mainly through early retirement options and the sale of subsidiaries. The company also intends to reduce the number of aircraft in its fleet by 103 in the coming months.
“There will be further headcount reductions in the JAL Group, so that the number of group employees will go down from 48,714 as of the end of financial year 2009 to roughly 32,600 at the end of financial year 2010,” the airlines said in a statement. “We will sell or liquidate subsidiaries, including selling the hotel business, and concentrate managerial resources on the air transport business”.
The airline collapsed under a mountain of debt, battered by safety lapses, ballooning pension payments and the need to streamline its flight routes amid intensifying global competition.
The bankruptcy of Japan Airlines is said to be one of the country’s largest-ever corporate failures.
