JAL to stay with American Airlines, spurn Delta: reports

American Airlines and Delta Air Lines are competing to take a stake in JAL despite its bankruptcy filing last month with U$26 billion of debt — one of Japan's biggest ever corporate failures.

Japanese media had previously said JAL planned to switch to Delta and its SkyTeam airline alliance from American Airlines' Oneworld alliance as part of its recovery plan.

But JAL's new management and the government-run Enterprise Turnaround Initiative of Japan, which supervises the airline's revival, have concluded that the switch would be costly and risky for JAL, the Asahi Shimbun and other news reports said on their web sites.

A JAL spokesman would not confirm the report, saying: “Nothing is decided on this issue and the reports are based on speculation.”

Earlier this month, Japan Airlines' new management team said it was starting from scratch in its talks with foreign rivals about a possible tie-up, part of efforts to revive the stricken carrier.

Both U.S. carriers are offering financial assistance to JAL — which is slashing more than 15,600 jobs and axing unprofitable routes — in return for cooperation in areas such as joint flight operations through code-sharing.

JAL plans to tell Delta as early as this week that it will terminate the tie-up negotiation, while together with American the Japanese airline will apply for anti-trust immunity with the U.S. Department of Transportation within this month, the Nikkei business daily reported.

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