JAL favors oneworld, American

Japan Airlines Corp., which last month filed for bankruptcy protection, is expected to remain in the oneworld grouping led by American Airlines Inc. and drop plans to ally with Delta Air Lines Inc. and its SkyTeam members, sources said.

JAL, under new management headed by Chairman Kazuo Inamori, has apparently determined the time and cost required for a new tieup with Delta could hamper its aim of turning itself around in three years, according to the sources.

JAL was leaning toward choosing Delta over American as its U.S. alliance partner while going through government-supervised restructuring, in the hope of taking advantage of Delta's more extensive routes in strengthening its medium- to long-term competitiveness.

However, JAL is now looking toward reinforcing its existing relationship with American, the second-largest U.S. carrier, the sources said.

If JAL were to form an alliance with Delta and switch to the SkyTeam global airline alliance, the situation could upset customers and possibly lead to a temporary fall in revenue, the sources said.

A tieup with Delta, the world's largest airline, would also increase the two airlines' share in the U.S.-Japan market, making it unclear whether the partnership would be granted antitrust immunity by U.S. authorities under a bilateral agreement to liberalize air transport.