ANA Announces Business Plan for 1999*
ANA Continues Rationalization of Route Network to Maximize Profitability
25 February, 1999 - All Nippon Airways (ANA), Japan's largest passenger carrier, today announced its business plan for 1999*. Following the suspension of dividend payments in fiscal 1998 for the first time in 30 years, ANA embarked upon a three-year Corporate Restructuring Plan to radically improve its revenue-cost structure. During the first year of this plan, ANA further deepened and accelerated its restructuring efforts in order to achieve improved profitability despite stagnating market growth. However, faced with an unprecedented economic downturn in Japan and increasingly competitive price wars, 1999 looks to be another challenging year. ANA recognizes the urgent need to create a new operating structure which will help increase profitability by re-evaluating its route network and concentrating resources. "1998 has undoubtedly been a tough year, but I think that we are making some very positive changes," said ANA President and CEO Kichisaburo Nomura. "Japanese companies will have to fundamentally change the way they do business to achieve profitability in the current harsh economic climate. Our 1999 Business Plan shows how ANA is re-thinking its route network as a part of this process. " ANA's 1999 Business Plan seeks to improve profits by increasing the efficiency of ANA's route network and targeting high-revenue routes in both domestic and international markets. At the same time, the company will continue vigorous cost-cutting measures and strengthen its finances by reducing investments in aircraft over the medium term. ANA's sales and marketing structure will also be reorganized to support increased revenues in the face of stiffer competition. International ANA's focus in international services is the consolidation of high-revenue ANA-operated "business" routes from Narita and the suspension or reduction of services on non-profitable routes.Strategic alliances will be utilized to expand ANA's network and sharpen overall competitiveness.
* for fiscal 2000, ending March 31, 2000
Domestic The deregulation of the Japanese domestic aviation industry provides ANA with new opportunities to rationalize its route network systems and maximize profits. ANA will focus on maintaining its dominant position in the domestic market by reorganizing its route network to revolve around its hub at Haneda Airport in Tokyo, and by redistributing other routes to its subsidiary, Air Nippon (ANK). Aircraft size and seasonal changes in frequencies will also be adjusted to better reflect market demand.Details of ANA's 1999 Business Plan may be found on the following pages. ends |