The novel coronavirus pandemic is forcing airlines to again make cuts in their flight plans.
Although All Nippon Airways Co. and Japan Airlines Co. rolled back their reductions in August, they plan to expand the cuts again in September.
The airlines are facing deteriorating business conditions, and are trying to minimize fuel and other variable costs by cutting flights, but for now their fates will continue to be controlled by the state of the pandemic.
In September, ANA plans to reduce domestic flights by 45% of its initial plan, equivalent to 10,445 flights. That is a 20 percentage point increase in the reduction rate compared to the previous month.
JAL is planning a 32% cut, equivalent to 8,223 flights and a four-point increase from the previous month.
Both airlines began cutting domestic flights in March as demand dropped due to the pandemic.
In May, when a state of emergency was declared, their reduction rates exceeded 70%.
Since then, requests that people not cross prefectural lines have gradually been relaxed, which caused the reduction rate to go down. However, things have changed with the recent surge in infections. The "Go To Travel" project launched by the government on July 22 to stimulate tourism was also a flop.
With infections soaring, the number of passengers during the Bon holiday period of Aug. 7-16 dived 69.6% year-on-year to 478,650 for ANA, and by 66.9% to 390,102 for JAL, amid a stream of cancellations and people deciding not to travel.
"Demand has declined significantly in all areas," an ANA public relations official said.
According to Japan Aviation Management Research, a private research company, 60% is the lowest occupancy rate for domestic flights at which ANA and JAL can secure a profit.
However, during the Bon period ANA's rate was 32.7%, compared to 85.0% during the same period last year, and JAL's rate was 37.1% compared to 86.5%, both well below 60%.
ANA Holdings Inc., which owns ANA, and JAL both posted losses of around 100 billion yen in net income in their financial reports for the April-June quarter of 2020.
ANA Holdings Chief Financial Officer Ichiro Fukuzawa said he believes demand for domestic flights will recover to the level seen before the pandemic at the end of fiscal 2021.
JAL Representative Director Hideki Kikuyama said he thinks demand will be about 80% the level before the pandemic at the end of this fiscal year.
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