Japan Airlines and JAL Express will be merged, with the JAL Express unit to be dissolved altogether.
In a statement, JAL says that merging the two carriers (JAL holds 100% of JAL Express) will help the carrier better match capacity to demand.
The merger will be effective on 1 October 2014.
JAL Express operates 39 Boeing 737-800 aircraft. It offers low-cost domestic services from its primary hub at Osaka to destinations including Kobe, Kumamoto, Nagasaki, Nagoya, Oita, Sapporo and Sendai. It also operates regional services between Japan and the Chinese cities of Guangzhou and Shanghai.
As for 31 March 2013 JAL Express had 919 employees.