New slots at Tokyo Haneda International airport have led to a situation where demand is lagging capacity growth in Japan, JAL’s chairman says.
Masaru Onishi told reporters on the sidelines of the IATA AGM in Doha that the additional domestic and international slots released at Haneda in the last two years has resulted in an “imbalance” between supply and demand.
“Based on the capacity of the airport itself, there has been a large increase in the supply and demand has not kept up,” he adds.
While he is optimistic that demand will bounce back, Onishi admits that traffic has been impacted by the recent political tensions between Japan, China and South Korea which will impact on JAL’s fiscal 2015 bottom line. “We believe that this fiscal year business will be a little difficult for us,” he adds.
JAL has forecast its operating profit for the year ending March 2015 will fall to Y150 billion ($1.4 billion), compared to Y167 billion it recorded during fiscal 2014.
Nevertheless, Onishi does not believe that the situation will persist long enough to have a significant impact on the carrier’s cash position. “We believe that within the next one and a half years, the current increase in capacity we have, the demand will catch up. So we do not forsee any cash issues in the very near future,” he says.