How Japan's Largest Airline is Navigating Through Covid-19

Written by Eashan Trehan

Airlines across the globe are struggling to cope with the fallout of the pandemic, which has resulted in a nosedive in passenger volumes. In an atmosphere of doom and gloom it is worth taking a look at what Japan’s largest airline, ANA, is doing to navigate this crisis, especially given the airline’s past brush with failure several years ago, when it managed to muster a turnaround.

ANA declared a mammoth loss of USD 1.51 billion in the most recent quarter and in lieu of the adverse environment is looking to aggressively fill up its coffers. To this end, the airline recently secured USD 3.8 billion in subordinated loans from state-backed and private lenders. A cursory look at its revenues reveals that approximately half of its revenues can be traced back to domestic travel, which has received a boost from the Japanese government’s “Go To Travel” domestic tourism campaign. Slashing of staff-related costs have also eased the pressure on ANA as well. However, in spite of how bad things might get, the feeling in the industry by large is that ANA and JAL, the two largest Japanese airlines, are too significant for the Japanese government to allow to go bust.

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Analysis: Japan's ANA charts course through COVID with loans, domestic flights and accounting rules

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