JAL fortifies low-cost strategy with Jetstar Japan, Spring Japan investments

Japan Airlines will make additional investments in two of its three low-cost units, Jetstar Japan and Spring Japan, as it looks to build up a low-cost network centred around its Tokyo Narita hub. Though it did not disclose the financial value of the investments, JAL says they are partially supported by funds raised from a public offering in November 2020. The latest announcements comes as Spring Japan officially became a JAL consolidated subsidiary. The carrier first disclosed plans to acquire Spring Japan — a joint venture with Chinese low-cost giant Spring Airlines — in early May, as part of its medium-term business plan. JAL had previously owned 48% of the low-cost unit, though this was boosted to a majority stake following the acquisition. In its latest update, JAL reiterated its broad low-cost strategy involving its three units, which also comprise medium- to long-haul unit Zipair. The three Narita-based carriers will each target a specific market, states JAL. Together, they will target “revenue growth in low-yield markets, with steady recovery and solid growth potential” following the coronavirus pandemic, which has impacted the carrier’s profitability. <br/>