LEITHEN FRANCIS / SINGAPORE

All Nippon Airways (ANA) is pushing ahead with plans to introduce permanent salary cuts, although it and Japan Airlines System received a multi-million dollar emergency loan package last week from the Japanese government.

The state-run Development Bank of Japan loaned Japan Airlines System, the parent of Japan Airlines (JAL) and Japan Air System, ¥70 billion ($625 million), while ANA received ¥15 billion in low-interest loans.

JAL says it received more than ANA because it "has more exposure to the international market", while ANA says it was hoping to get ¥50 billion rather than the ¥15 billion it has been awarded. The two airlines were seriously affected this year by the fall in passenger demand following the war in Iraq and the SARS outbreak.

The airline's 2,682 management employees took permanent wage cuts of 5% in April, but now the airline wants those same cuts to apply to members of the ANA Workers' Union and the ANA Crew Association pilots' union, starting from 1 April next year.

ANA says: "This is not just about meeting short-term financial goals. It is about becoming a leaner and more efficient organisation with a more stable financial and economic base."

ANA announced in February that it aims to save ¥30 billion in costs between April 2003 and March 2006.

Source: Flight International