Tokyo - Asia's largest carrier Japan Airlines has hit major turbulence in recent years as the mammoth company repeatedly miscalculated tougher business climates.
Flying to 217 airports in 35 countries and regions, the flag carrier of the world's second-largest economy is saddled with huge debt and set to file for bankruptcy as early as next week in a court-led rehabilitation process.
JAL's history has mirrored the bumpy path of the nation's "miracle" economic recovery after World War II and its subsequent stagnation which started with the so-called lost decade of the 1990s.
The airline was established in 1951, half controlled by the government. It made its international debut in 1954, connecting Tokyo, Honolulu and San Francisco.
With the trademark crane logo on its wings, JAL rapidly widened its operations at home and overseas, at one stage becoming the world's largest carrier in terms of regular flights.
Disaster struck in 1985 when a JAL Boeing jumbo jet crashed into a mountainside in central Japan, killing all 520 people aboard in the worst single-airplane accident in aviation history.
As it battled to overcome the tragedy, the carrier was fully privatised in 1987 and expanded its fleet in the early 1990s, a move which soon turned out to be a financial burden as the speculative "bubble" economy burst.
The carrier now has 279 aircraft, including 113 leased planes, most of them Boeing jets. It transported about 53 million passengers last fiscal year, 41 million of them on domestic routes.
As the global aviation industry was battered by the fall-out from the September 11, 2001 attacks as well as the Sars and bird flu scares, JAL plunged into huge losses and sought massive credit lines from the government.
In a bid to survive the tougher business environment, JAL and domestic carrier Japan Air System merged to form JAL Group, changing the logo to the current "Arc of the Sun" resembling the national flag.
The integration, however, led to further losses and a slowdown in restructuring efforts, while its late-coming rival All Nippon Airways (ANA) moved into high gear.
Despite the privatisation, JAL has often come under political pressure to maintain regular flights to more than half of domestic airports even though many are unprofitable, said Makoto Murayama, analyst at Nomura Securities.
Murayama added that JAL also miscalculated international demand.
"ANA predicted the decline in demand for international flights would not recover after the 9/11 terrorist attacks in the United States - which proved to be right in later years," he said. "JAL thought demand would recover."
More recently, the global economic downturn following the collapse of Wall Street investment bank Lehman Brothers as well as the swine flu outbreak dealt another serious blow. JAL lost about $1.5bn in the six months to September 2009.
JAL, which has about 47 500 employees, has also been saddled by huge pension pay-outs to retirees, who have now agreed to reduced payments.
Despite the airline's current woes, Japan's government said it would do everything possible to ensure that JAL keeps flying during a restructuring that is expected to include drastic route reductions and thousands of job cuts.
Its operations across Asia also remain coveted, with US carriers American Airlines and Delta Air Lines locked in a bidding war for a slice of JAL as they look to increase their share of the region's lucrative market.
- AFP