Japan Airlines to cut 6,800 jobs

The airline expects a heavy loss for the year

Japan Airlines (JAL) plans to cut 6,800 jobs, as an airline trade body upped its projected losses for the global industry this year.

"The personnel reduction cannot wait," said JAL president Haruka Nishimatsu.

Mr Nishimatsu said JAL will have a deal in place with an international carrier by the middle of October.

Media reports have said several US and European airlines are in the running to take a stake in the loss-making carrier.

The airline had already launched a programme of job cuts, plans for fuel-efficiency and a focus on business customers.

Reports this week have suggested that Delta Airlines and American Airlines are in talks to invest in JAL to expand into Asia via code-sharing agreements.

On Tuesday, another report said Air France-KLM joined those discussions. Each is discussing an investment of as much as $300m (£181m), the reports said.

Shares in JAL dropped 3.4%, after climbed nearly 8% on Monday.

Iata outlook

Separately, the International Air Transport Association (Iata) increased its forecast for losses across the whole industry to $11bn, from $9bn it predicted earlier this month.

"The outlook for the industry has deteriorated," said Iata director-general Giovanni Bisignani.

Airlines have already lost $6bn in the first half alone, Iata said, with Asian airlines among the hardest hit.

In the Asia-Pacific, airlines will post losses of $3.6bn, up from the previous forecast of $3.3bn.

European carriers are expected to be worst off this year, losing $3.8bn instead of the $1.8bn initially forecast.

Iata estimates losses next year of $3.8bn, and doesn't expect airlines to be in profit again until 2011 at the earliest.

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