Japan Airlines says fresh coronavirus wave curbs rebound in domestic travel demand

JAL expects sales from domestic flights to be between 55% and 65% of the previous year

  
A plane of Japan Airlines is seen at its maintenance center amid the coronavirus disease (COVID-19) outbreak at Haneda airport in Tokyo, Japan May 26, 2020.

A plane of Japan Airlines is seen at its maintenance center amid the coronavirus disease (COVID-19) outbreak at Haneda airport in Tokyo, Japan May 26, 2020.

REUTERS/Kim Kyung-Hoon

TOKYO - Japan's second biggest airline Japan Airlines Co (JAL) said on Monday a second wave of coronavirus infections in Japan has hurt hopes for a quick recovery in domestic air travel demand as the company posted a first quarter loss.

JAL posted a 131 billion yen ($1.24 billion) operating loss for the three months ended June 30 compared with a profit of 19.9 billion yen a year earlier. The airline declined to provide an earnings forecast for the full business year.

"We thought there would be something of a recovery in demand, but the resurgence in infections has made it a tough environment," Hideki Kikuyama, JAL's chief financial officer, said after the carrier announced its earnings.

JAL, like other carriers around the world, has been hammered by a collapse in air travel as the coronavirus spreads. But fewer cases in Japan compared with heavily infected countries such as the United States, had raised hope for a quick revival in domestic travel.

That expectation has receded as Japan deals with a second wave of infections that has surpassed the peak of the first. Japan confirmed 1,332 new infections on Sunday, around a quarter of which were in Tokyo, according to public broadcaster NHK.

For the business year, JAL said it expects sales from domestic flights to be between 55% and 65% of the previous year, with international routes at between 10% to 20%.

The International Air Transport Association (IATA) predicted last week that international air passenger numbers would not return to pre-crisis levels until 2024.

JAL's larger rival ANA Holdings 9202.T reported last week a first quarter loss of 159 billion yen and said it expected domestic air travel to recover by March 2022.

($1 = 105.8600 yen)

(Reporting by Tim Kelly; Editing by Ana Nicolaci da Costa) ((tim.kelly@thomsonreuters.com; +813-6441-1311;))

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