The Bankwatch

Tracking the consumer evolution of financial services

JAL imminent bankruptcy is yet another indication of a changing world economic landscape

I continue to be of the view that we are in the early stages of a revolutionary period and that the companys which survive will not be the ones that composed the DOW/ FTSE/ Nikkei indexes of the last 30 years. There is a shift occurring and the economic crisis is only a symptom, as global balances shift and move in ways we cannot even comprehend today.

Anyhow, in related news, yet another bastion of the old economy is in dire straits. JAL (Japan Air Lines) began in 1951, first flew to San Francisco in 1954, and in 1987 became 100% public owned. In 2002, JAL took over JAS (Japan Air Systems). 2009 November was their worst financials.  JAL stock has dropped from ¥210 to ¥4 today.

Anecdotal evidence suggests that even government employees have been abandoning JAL for competitor ANA recently.  Listening to my wife, there is a tremendous sense of patriotism and loyalty to JAL and they have continued to disappoint, yet this is a big day in Japan as they watch this situation unfold.

Out with the old companys and in with the new … banks, are you watching?

JAL plans radical cuts as bankruptcy looms

JAL’s expected filing for court protection from its creditors is one of Japan’s biggest corporate failures. The government is preparing at least Y900bn ($9.9bn) in new equity and credit lines to keep the airline operating while in bankruptcy.

Researched by Nobuyo Henderson

Written by Colin Henderson

January 19, 2010 at 02:46

Posted in economy, Japan

Tagged with , ,

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