Asiana Airways plane hits antenna as it lands at Japan airport

An Asiana Airways plane smashed into a communications antenna as it came in to land at a Japanese airport, footage showed Wednesday, injuring 27 people in an accident redolent of the airline's fatal 2013 crash in San Francisco.

Aerial footage from Hiroshima airport in western Japan showed the localiser - a large gate-like structure, six metres (18 feet) high that sits some distance from the start of the runway - splintered, with debris spread towards the landing strip.

Sets of wheelmarks were visible on the grass area in front of the runway, while at least one large fragment of the localiser - which aircraft use to find the landing strip - was on the tarmac.

Several hundred metres away, skid marks showed the Airbus A320 had careered off the runway and rotated more than 90 degrees. What appeared to be a chunk of the localiser was seen dangling from one wing and emergency escape chutes were deployed.

Those on board flight OZ162 from Incheon, near Seoul, to Hiroshima, spoke of terror and confusion.

"There was smoke coming out and some of the oxygen masks fell down. Cabin attendants were in such a panic and I thought 'we are going to die'," a woman told Japanese networks late Tuesday.

All 73 passengers and eight crew members had evacuated, and no one was killed, but 25 passengers and two crew members had been injured, Japanese officials said.

An aviation safety official at the transport ministry in Tokyo told AFP that teams of investigators were on their way.

"The left side of the aircraft's horizontal tail was damaged... but how the accident occurred should be determined as the transport safety board carry out their investigation," he said.

The South Korean carrier said 18 passengers - 14 Japanese, two Koreans and two Chinese - had been hurt. Only one of them had to stay overnight in hospital. There was no explanation for the discrepancy between Asiana and the Japanese authorities.

"Asiana Airlines apologises for causing concern to the passengers and the people over the accident," it said in a press statement.

"Asiana Airlines has immediately set up a response team to cope with the aftermath.

"As to the determination of the cause of the accident, we will co-operate as closely as possible with the relevant authorities." An Asiana spokeswoman told AFP in Seoul it was checking Japanese news reports that the flight was approaching the runway at a lower altitude than normal before it grazed the communications tower near the runway.

Tuesday's accident carries echoes of an Asiana flight that crashed in San Francisco in July, 2013, killing three people and leaving 182 injured.

US investigators concluded that a mismanaged approach for landing in a highly automated cockpit was the probable cause of the accident, in which a Boeing 777 clipped a sea wall with its landing gear, then crashed and burst into flames.

The South Korean Transport ministry ordered a 45-day suspension of Asiana Airlines' service to San Francisco as a penalty.

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All Nippon Airways' first-half net profit jumps 78% to US$328m

Japan's All Nippon Airways (ANA) said on Thursday (Oct 30) its half-year net profit soared 78 per cent as an expansion of one of Tokyo's airports boosted the carrier's international business. The airline earned ¥35.77 billion (US$328 million) against a ¥20.07 billion net profit a year earlier, while April-September sales rose 9.1 per cent to ¥854.82 billion, it said.

ANA increased its international services after a major development of Tokyo's downtown Haneda Airport, which it said helped offset a jump in operating expenses that mainly came from higher fuel costs. A sharp decline in the yen has sent the price of fuel - often an airline's single-biggest expense - surging for ANA and rival Japan Airlines (JAL), which reports its earnings on Friday.

Operating profit for the first half year rose 33 per cent to ¥57.94 billion, ANA said, while it also booked a one-off profit of ¥9.9 billion after changing the structure of its corporate pension scheme. For the full-year to March, the airline kept its estimate of a ¥35 billion net profit on sales of ¥1.7 trillion.

ANA has enjoyed improved fortunes after Haneda, which is much closer to the capital than rival Narita airport, increased capacity to handle more international flights. The airline has added services to major cities including London, Paris, Munich and Jakarta. ANA said its international business saw strong demand, while on the domestic side more flexible price-setting and a fare rise this summer boosted sales.

ANA and rival Japan Airlines (JAL) are increasing their use of the lighter weight Boeing Dreamliner to contain costs, but the fuel-efficient aircraft has been hit by a series of technical problems that forced a months-long grounding last year.

"Competition inside and outside Japan is expected to intensify, in addition to various risks such as fluctuations in foreign currency exchange rates, slowing of foreign economies and other international event risks," it said "We will proceed with multiplying our businesses, and reform our cost structure to maximise our group's profitability."

In contrast, smaller domestic rival Skymark Airlines booked a net loss of ¥5.74 billion in the April-September period, against a profit of ¥1.70 billion a year earlier. It also warned of a full-year net loss of ¥13.68 billion, against a previous forecast of a ¥354 million profit.

The carrier was born out of deregulation measures in the 1990s that were aimed at challenging ANA and JAL's control of the market. However Skymark has been seen ballooning losses owing to new entrants into the budget sector. The struggling airline was sideswiped when Airbus in July said it had cancelled its US$2.2-billion jet order, apparently over concerns about payment.

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Japan to unveil first passenger jet in four decades

The first made-in-Japan passenger aircraft in nearly four decades is being unveiled on Saturday (Oct 18) as its maker pushes into the booming regional jet sector with an eye to taking on industry giants Embraer and Bombardier.

Mitsubishi Heavy Industries, a military contractor best known for its "Zero" World War II fighter, is set to pull back the curtain on its new Mitsubishi Regional Jet (MRJ), a fuel-efficient, next-generation aircraft that claims to offer more passenger comfort with lower operating costs.

The jet, which will be delivered to customers from 2017 and was built with assistance from aviation giant Boeing, is being unveiled at a ceremony in the central city of Nagoya on Saturday.

"The MRJ programme has been making steady progress, and its state-of-the-art aerodynamic design, and a game-changing engine will significantly cut fuel consumption, noise and emissions, helping airlines enhance competitiveness and profitability in the future," Teruaki Kawai, president and chief operating officer of Mitsubishi Aircraft, said in a recent statement.

The plane marks a new chapter for Japan's aviation sector, which last built a commercial airliner in 1962 - the YS-11 turboprop. It was discontinued about a decade later.

Japanese firms were banned from developing aircraft by US occupiers following its defeat in World War II. The country slowly started rebuilding its aviation industry in the 1950s, starting with supplying repair work for the US military, before expanding its scope to start licensed production of US-developed aircraft for Japan's Self-Defence Forces. Japanese firms have also long supplied parts to Boeing.

Mitsubishi's short-to-medium haul regional jet, which comes in a 70 and 90-seat version, was backed by the Japanese government and a consortium of major firms including Toyota with research and development costs of around 180 billion yen ($1.7 billion).

EYE ON 2020 TOKYO OLYMPICS

The company has secured 375 orders and options from carriers including All Nippon Airways (ANA), US-based Trans States Holdings, and SkyWest. Japan Airlines (JAL) has also signed a Letter of Intent for 32 MRJs, which have a list price of $40 million, to be used on domestic flights.

The MRJ project got off the ground in 2008 after ANA agreed to buy two dozen of the planes. But it quickly flew into turbulence as the global economic downturn battered the aviation industry, forcing many carriers to slash jobs and routes.

The project took flight again as Tokyo tries to lure more overseas visitors to Japan ahead of the 2020 summer Olympic Games in Tokyo. The Japanese government is also aiming to expand firms' foothold in the global aviation and military sectors as the domestic market shrinks due to a rapidly ageing population.

The jet will compete with small aircraft produced by Brazil's Embraer and Canada's Bombardier, as well as jets designed by Russian and Chinese firms.

Its maker pointed to expected global demand of 5,000 regional jets over the next two decades.

"Five thousand is not a small number," Kawai told the Wall Street Journal in an interview published this week. "I'm claiming we can get 50 percent of that. That's what we are aiming at right now. But in 20 years, I'm saying, not in three to five years, if our research is correct. We have to be ambitious."

Automaker Honda is also developing a business jet, with its first delivery expected next year in North America and Europe.

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Japan's Skymark surges on possible Airbus 'penalty deal'

Shares in Japan's Skymark Airlines soared Friday (Oct 3) after the company said it was negotiating with Airbus to reduce a breach-of-contract penalty tied to the collapse of a US$2.2 billion jet order.

The carrier's Tokyo-listed shares closed 8.37 per cent higher at ¥220, after jumping as much as 15 per cent earlier in the day on reports that a deal was imminent. "Our company is negotiating with Airbus, and we're aiming to reach an accord by the end of October," Skymark said in a statement.

But the firm declined to comment on a report in the Asahi newspaper which said Airbus had agreed to cut the penalty to about ¥20 billion (US$183 million), well below its original ¥70 billion demand - which some feared would put Skymark out of business.

The struggling airline was sideswiped when Airbus in July said it had cancelled its US$2.2-billion jet order, apparently over concerns about getting paid. Skymark shares had lost more than 40 per cent at one stage following the collapsed deal.

At the time the carrier said Airbus had threatened it with "overpriced" penalties and called on it to merge with a bigger airline, a proposal which Skymark's top executive flatly rejected. The deal for six Airbus A-380 jets was signed in 2011, but Skymark missed a payment deadline earlier this year.

The carrier was born out of deregulation measures in the 1990s which were aimed at challenging All Nippon Airways and rival Japan Airlines' control of the market. However Skymark has been reporting ballooning losses as new entrants into the budget sector hurt its business.

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Japan probe comes up empty on Dreamliner battery problems

The Japanese probe into a battery problem that forced the emergency landing of a Boeing Dreamliner last year wrapped up on Thursday (Sep 25) with investigators saying they still have not found the root cause. The domestic All Nippon Airways (ANA) flight on January 16, 2013 was forced to make an emergency landing after pilots noticed a burning smell inside the cockpit that was traced to the plane's lithium-ion battery pack.

But neither Boeing nor battery manufacturer GS Yuasa were able to pinpoint what caused the battery to overheat and on Thursday, the Japan Transport Safety Board (JTSB) issued its final report that suggested a short circuit might be responsible. "The heating phenomenon that began in the number-six cell (of the main battery on board the plane) is believed to have been caused by an internal short-circuit. However, in the end, its developmental mechanism could not be identified," said the 115-page report.

The flight from Ube in Japan's far west to Tokyo marked the most serious case of battery overheating in the Dreamliner which features a composite fibre fuselage that reduces weight and boosts fuel efficiency. ANA, the single biggest operator of 787s, and its domestic rival Japan Airlines (JAL) were among the carriers hit by the worldwide grounding of Boeing's plane following a series of battery problems that also led to a fire onboard an empty JAL plane parked at Boston's Logan Airport.

The Japanese report noted that specks of metal were found inside the battery pack and might be linked to the overheating, but GS Yuasa has rejected suggestions that the impurity was dropped into the packs during manufacturing.

Among the 137 passengers and crew members on board, four passengers suffered minor injuries when they came off an emergency slide, the probe said. That incident prompted a still-ongoing investigation by US National Transportation Safety Board (NTSB).

Boeing admitted in April last year that, despite months of testing, it did not know the root cause of the battery problems, but it rolled out modifications to prevent a recurrence. The Dreamliner has also been hit by a series of unrelated glitches, including a fault with an air pressure sensor and the brake system.

Despite the troubles, the aircraft remains popular. This week Ethiopian Airlines agreed to buy 20 Boeing 737 aircraft in a deal worth US$2.1 billion.

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ANA, Lufthansa announce cargo business tie-up

Japan's All Nippon Airways (ANA) and Lufthansa of Germany on Wednesday (Sep 3) announced an air cargo tie up as they look to fight off intense competition from budget airlines on passenger routes. The airlines said they had won regulatory approval for the agreement, which will see them integrate network planning, pricing, sales and handling on all routes between Japan and Europe.

"The two carriers aim to introduce the joint approach on shipments originating from Japan to Europe in winter 2014/2015 and for shipments from Europe to Japan in mid-2015," they said in a statement. "The joint venture will benefit customers by generating a greater selection of routings and a wider range of service options. Customers will especially profit from a larger and faster network with more direct flights, more destinations and more frequencies."

ANA and Lufthansa, both members of the Star Alliance global airline network, launched a joint venture for Japan-Europe passenger flights two years ago. The Japanese carrier holds a 17 per cent market share for air freight between Japan and Europe, while Lufthansa has 16 per cent, the leading Nikkei business daily said on Wednesday. Mainline carriers' cargo businesses have become increasingly crucial to their bottom line as they battle budget airlines in the passenger market.

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Japan's Skymark Airlines surges on AirAsia takeover report

Skymark Airlines shares soared Tuesday (Aug 19) after a report said Malaysia's AirAsia was eyeing the struggling Japanese carrier, but both firms dismissed the story, with AirAsia's chief executive saying he had "never seen such rubbish". The Tokyo-listed stock jumped 27.77 per cent to finish at 230 yen, its maximum allowable single-day gain, on the report in Japan's leading Nikkei business daily.

The report, which cited unnamed sources, said AirAsia was in talks with its lenders over a possible takeover bid for money-losing Skymark. In a statement, AirAsia dismissed the story as "speculation" and "just another industry rumour". "Never seen such rubbish. AirAsia has no interest in Skymark in Japan," AirAsia chief executive Tony Fernandes wrote on Twitter. "There have been no discussions with Skymark."

The putative takeover target also questioned the report. "We're not aware that there is any truth in what has been reported," Skymark said in a statement.

In the wake of its bitter split last year with All Nippon Airways (ANA) over a budget carrier joint venture, AirAsia has announced it would jump back into the Japanese market in a tie-up with e-commerce giant Rakuten. The Nikkei had said the low-cost carrier might create a new local subsidiary, backed by Rakuten, to launch the bid for Skymark to get around restrictions on foreign ownership in Japanese airlines.

Skymark was born out of deregulation measures in the 1990s which were aimed at challenging ANA and rival Japan Airlines' control of the market. But the carrier has been reporting ballooning losses as new entrants into the budget sector hurt its business.

The airline was sideswiped when Airbus last month said it had cancelled a US$2.2 billion jet order with the carrier, apparently over concerns about getting paid. Skymark shares had lost more than 40 per cent at one stage following the collapsed deal.

The company said the European aviation giant had threatened it with "overpriced" penalties and called on it to merge with a bigger airline, a proposal which Skymark's top executive flatly rejected. The Nikkei report also said AirAsia, a major Airbus customer, had approached the plane maker about reducing the cancellation penalties. Skymark has said it was mulling the cutting of unprofitable routes and borrowing more money from its banks to stay afloat.

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Japan's ANA drops plan to buy stake in Myanmar airline

Japan's All Nippon Airways (ANA) has dropped its plan to buy a 49 per cent stake in a Myanmar airline, blaming "intensified" competition in the country as it quickly emerges from years of economic isolation.

ANA Holdings -- the airline's parent company -- announced last year that it planned to invest about US$25 million (S$31 million) in Asian Wings Airways (AWA).

But "competition between new and old airlines in Myanmar has intensified... calling into question the assumptions made at the time of the original decision", the Japanese firm said in a statement Wednesday (July 30). "Ultimately, negotiations for the capital participation with AWA were unable to reach an agreement, and the investment plan was cancelled as a result." The move will not impact earnings for the current fiscal year, ANA added.

The announcement came as the Japanese carrier said it had swung back to profitability in the three months to June.

With little room for growth in the domestic market, ANA and other Japanese firms have been eyeing Southeast Asia as a lucrative market. Foreign companies have piled into Myanmar since the installation of a nominally civilian government in 2011, eager to make the most of opportunities in the country as it opens up following decades of junta-led government.

Asian Wings said it was disappointed by the ANA pullout. "This is a big loss, not only for us but also for other Myanmar local airlines," said the Myanmar airline's executive director Lwin Moe, adding that it would not have "any difficulties" as a result of the decision.

Shares in ANA closed 2.31 per cent higher at 256.5 yen on the Tokyo Stock Exchange Thursday.

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Japan's All Nippon Airways swings back to profitability

Japan's All Nippon Airways (ANA) said on Wednesday (July 30) it had swung back to profitability in the three months to June, thanks to an expansion at a Tokyo airport and a change to its pension plan.

The carrier said net profit was 3.5 billion yen ($34 million) against a loss of 6.6 billion yen a year earlier, while quarterly sales rose 10.0 percent to 386.8 billion yen. It also logged an operating profit of 347 million yen, from an operating loss of 5.6 billion a year ago.

The sharp improvement came as ANA expanded its international services, benefiting from a major expansion of Tokyo's downtown Haneda Airport, which helped offset a jump in operating expenses mainly due to higher fuel costs.

The firm also booked a 9.9 billion yen extraordinary gain as it changed the structure of its corporate pension scheme, ANA said.

The firm's sales growth was supported by solid demand for domestic and international air travel. Like Japan Airlines, ANA said its overseas business saw strong demand, while flights to Japan rose steadily as the country logs record tourist arrivals. The firm benefited from Haneda's increased capacity to handle international flights, with ANA adding services to major cities such as London, Paris and Hanoi.

"ANA continues to strengthen its network, taking advantage of the expansion of international slots at Haneda Airport from this March," it said

The airline left unchanged its forecast for the fiscal year through March, expecting a 35 billion yen net profit, an operating profit of 85 billion yen, and 1.7 trillion yen in annual sales.

On Tuesday, Japan Airlines said its April-June net profit fell 19.4 per cent to $145 million, after repeatedly warning about the steadily rising cost of fuel, often a carrier's single-biggest expense. A weaker yen inflates the cost of dollar-priced commodities such as jet fuel.

"It looks like ANA and JAL's earnings will be okay in the next quarter. But for the rest of the year, we have to wait and see what the impact of domestic fare prices increases will be after the summer," said Ryota Himeno, analyst at Barclays Securities Japan. "They're facing intense competition from other modes of transportation, such as the bullet train."

ANA and JAL are increasing their use of the lighter weight Boeing Dreamliner to contain costs, but the fuel-efficient aircraft has been hit by a series of technical problems that forced a months-long grounding last year.

However, the two airlines have stood by Dreamliner, with ANA slated to become the world's first airline to operate the new stretched version of the plane in August.

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JAL's quarterly net profit drops 19.4% to US$145m

Japan Airlines (JAL) said on Tuesday its net profit for the April-June quarter fell 19.4 per cent to US$145 million (S$180 million), as a weak yen and soaring fuel costs dug into its results.

The carrier said net profit fell to 14.8 billion yen (US$145 million), while operating profit also dropped 15.6 per cent to 18.6 billion yen. Sales ticked up 4.4 per cent to 307.1 billion yen.

A brief company statement did not outline reasons for the weaker profit figures. But the airline has previously warned that a sharp drop in the yen has driven up the cost of fuel, often a carrier's single-biggest expense. The weaker currency makes commodities priced in US dollars more expensive.

The yen has lost about a quarter of its value against the dollar since late 2012 as Japanese premier Shinzo Abe and his hand-picked team at the Bank of Japan launched a policy blitz, dubbed "Abenomics", aimed at kickstarting the economy and reversing years of deflation.

During the three months to June, JAL said it saw a rise in demand for both overseas and domestic flights. The company logged a 7.6 per cent increase in revenues from international passenger services, while from domestic flight revenue edged up 0.5 per cent.

JAL and its chief rival All Nippon Airways have expanded their international operations as Tokyo's Haneda airport significantly boosted its capacity to accommodate international flights.

Following Haneda's expansion, JAL launched additional flights linking Tokyo with London, Paris, Singapore, Bangkok and Ho Chi Minh City. The firm also increased domestic flights between Haneda and regional cities across Japan.

But JAL warned that its operating costs rose 9.5 per cent in the first quarter, compared with the same period last year.

JAL maintained its annual forecast for the fiscal year through March, with the firm expecting a net profit of 115 billion yen, down 30.8 per cent from a year earlier, and an operating profit of 140 billion yen, down 16.1 per cent. Annual sales were expected to come in at 1.35 trillion yen, up 3.1 per cent.

JAL, along with ANA, is increasing its use of the lighter weight Boeing Dreamliner to contain costs, but the fuel-efficient aircraft has been hit by a series of technical problems that forced a months-long grounding last year.

JAL re-listed its shares in Tokyo in 2012 to mark a spectacular turnaround three years after it went bankrupt with massive debts and saw its stock delisted from the Tokyo Stock Exchange.

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Japan airlines post falling profits on high fuel costs

Japan's two biggest airlines said Wednesday that their full-year net profit had tumbled despite higher demand for air travel, blaming high fuel costs for shrinking their bottom line.

All Nippon Airways (ANA) took the biggest hit with its operator saying that net profit nosedived by 56 per cent to 18.89 billion yen ($185 million) in the fiscal year to March.

Revenue, however, came in at a record 1.60 trillion yen, up from 1.48 trillion yen in the previous 12 months, "helped by a gradual recovery in the Japanese economy", ANA Holdings said.

ANA's biggest domestic rival Japan Airlines said its fiscal year net profit slipped 3.2 per cent, and warned that earnings this year would also stumble.

The carrier said it booked a 166.25 billion yen net profit in the year to March, down from 171.67 billion yen a year earlier, while revenue ticked up to 1.31 trillion yen from 1.24 trillion yen.

For the current year to March 2015, JAL forecast that net profit would come in lower at 115.0 billion yen.

"The escalation of fuel costs due to the weak yen may prevail and competition may intensify in both international and domestic markets," it said.

A sharp drop in the yen, while giving a boost to Japanese exporters, has hurt the country's airlines by pushing up the cost of fuel, often a carrier's single biggest expense.

The yen has lost about a quarter of its value against the dollar since late 2012 following a policy blitz launched by Japanese premier Shinzo Abe and his hand-picked team at the Bank of Japan, aimed at kickstarting economic growth and beating deflation.

ANA said its fuel costs jumped 22 per cent from a year earlier, as it forecasted a net profit of 35 billion yen on revenue of 1.7 trillion yen in the current year to March.

A recovery in demand for flights on Chinese routes has been one bright spot after a longstanding Tokyo-Beijing territorial dispute erupted anew in late 2012, sparking a consumer boycott of Japanese brands that hurt firms for months.

Relations remain tense, but Japanese companies have reported that sales are returning to pre-dispute levels.

"The business on Chinese routes remains fragile," Mitsuru Miyazaki, analyst at SMBC Friend Securities in Tokyo, told AFP.

"The diplomatic factor may also weigh on Japanese travellers' interest in China. Looking ahead, the domestic economic recovery as well as an expansion of slots for international flights should be positives for the current year."

Both ANA and JAL have been working to recover from the global grounding of Boeing's 787 Dreamliner last year.

The pair are the US-based firm's biggest customers for the state-of-the-art plane, which only resumed flying after a months-long grounding -- caused by a series of battery problems -- forced the cancellation of hundreds of flights.

The firms are also fighting off increasing competition from a handful of low-cost carriers that have sprung up in recent years in a market they have long dominated.

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Japan's ANA orders 40 Boeing, 30 Airbus planes worth US$16.4b

All Nippon Airways (ANA) said Thursday it would buy 70 new planes worth $16.4 billion, with almost half from Airbus in a move that marked a victory for the European aircraft maker as it tries to prise open the lucrative Japanese market.

The airline will buy 40 planes from Boeing, its major supplier that has had a virtual stranglehold in Japan for decades, and 30 from Airbus to increase its fleet ahead of the 2020 Tokyo Olympics, a statement said.

The order includes 14 of Boeing's troubled Dreamliner as well as 20 units of the 777-9X, and six 777-300ERs.

It will also buy seven Airbus A320neo and 23 Airbus A321neo.

The aircraft will be delivered between 2016 and 2027 and will increase the size of the ANA fleet to 250 aircraft.

The new Boeing aircraft will serve mainly international routes while the Airbus aircraft will operate both overseas and domestic trips, ANA said.

"ANA Group's introduction of these new aircraft will help it respond to the needs of the increasing number of passengers expected to arrive in Japan in the run-up to the 2020 Tokyo Olympics and will support the Japanese government's plans to boost the annual total of foreign visitors to Japan to 20 million," the firm said.

The orders, collectively the biggest in ANA's history, came as the airline aims to expand its international presence.

"The aircraft we have selected will enable us to modernise and expand our fleet further as we seek to become one of the world's leading airline groups," said Shinichiro Ito, president and chief executive of ANA Holdings.

"These new aircraft will give us maximum flexibility and improved fuel efficiency and will allow us to meet the growth in demand, both internationally and in our domestic Japanese market," he said in a statement.

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Japan airlines locked in fresh landing slot battle

Japan's two biggest airlines were locked in a fresh battle on Friday over landing slots at a Tokyo airport, with the civil aviation regulator playing referee between the warring carriers.

The spat erupted again as All Nippon Airways (ANA) lodged a complaint over rival Japan Airlines' (JAL) application to launch a new route to Ho Chi Minh City from downtown Haneda airport, the world's fourth-busiest hub.

The request came several months after Japan's transport ministry awarded twice as many Haneda landing slots to ANA, prompting threats of legal action from its key domestic rival which had earlier received a massive bankruptcy rescue from Tokyo.

On Friday, ANA president Shinichiro Ito said JAL's request was giving the airline a "great sense of crisis", and warned it was falling behind its bailed-out rival.

"We are concerned that the business environment would get further distorted," he told reporters in Tokyo Friday, adding that "we hope the Civil Aviation Bureau will make an appropriate decision".

ANA has tried to cut costs and boost productivity to keep up with its rival, Ito said.

"But there is no way we can catch up if this distorted business environment continues," he added.

A bureau official told AFP that a decision on JAL's bid would made be after considering "all aspects of ensuring that there is an environment of fair competition".

A JAL spokesman said the new route was aimed at rising demand from business passengers, but declined to comment on its rival's objections.

The two carriers are looking to boost their international routes -- and lucrative business clientele -- as they fight off competition from a fledging budget sector focused mainly on domestic flights.

ANA has routinely criticised once-bankrupt JAL's bailout, which saw it re-list its shares in Tokyo after a share offering that raised a whopping $8.5 billion, one of the biggest globally in 2012.

The carrier has posted strong earnings since its return to the market, placing it among the most profitable airlines in the world.

In October, the government said ANA would get 11 of 16 new international take-off and landing slots at the airport in Tokyo bay.

JAL, which had expected to share the slots evenly, got just five. The new route to the Vietnamese city was not part of the earlier allocation.

Haneda has better access to the Japanese capital's downtown than suburban Narita airport, which is a major international gateway.

Japan's transport ministry is aiming to boost international flights at both airports in anticipation of big influx of visitors for the 2020 Olympic Games in Tokyo.

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Japan carriers' profits hit as weak yen hikes fuel costs

Japan's two biggest airlines said on Friday that the weak yen sent fuel costs soaring and profits into a nosedive as they struggled to recover from the global grounding of the Boeing Dreamliner plane last year.

However, while the surge in fuel costs, often a carrier's single-biggest expense, hit the bottom lines of Japan Airlines (JAL) and All Nippon Airways (ANA), they said a recovery in international travel helped lift sales.

Both companies are US-based Boeing's biggest customer for the state-of-the-art plane, which only resumed flying after a months' long grounding -- caused by a series of battery problems -- forced the cancellation of hundreds of flights.

The carriers are also fighting off increasing competition from a handful of low-cost carriers that have sprung up in recent years in a market they have long dominated.

On Friday, ANA said its net profit dived 36 per cent to 33.3 billion yen ($325 million) between April and December, citing the jump in fuel prices. Sales were up 7.1 per cent at 1.2 trillion yen.

JAL fared a little better, saying its nine-month net profit turned down 12.2 per cent to $1.2 billion, despite sales climbing 5.1 per cent on rising demand for international travel and its cargo service.

"The weak yen is a major factor holding back their profit," said Masaharu Shirokane, aviation analyst with Nomura Securities.

"It's a real headache for the Japanese aviation industry and as long as the yen remains weak, their bottom line will remain under pressure."

The yen has lost about a quarter of its value against the dollar since late 2012 following a policy blitz launched by Japanese premier Shinzo Abe and his hand-picked team at the Bank of Japan aimed at kickstarting economic growth and beating deflation.

JAL noted that a pickup in Japan's economy also helped lift demand for air travel ahead of an April sales tax hike.

"An economic recovery at home and overseas is stimulating demand, in particular business travel, which is profitable," Shirokane said.

"Demand for Chinese routes is also recovering from a slump... but it remains a potential risk in the future."

However, Japan's thorny ties with South Korea and China have depressed demand for flights to those countries.

Tokyo is embroiled in separate territorial spats with both countries, and a Chinese consumer boycott of Japanese brands in 2012 took a bite out of demand for flights through the first half of 2013.

ANA said it expects "passenger demand for business travel and leisure to remain robust" as it expanded its domestic and international routes, and offered discounted fares.

A 12.2 per cent rise in international passenger revenue as well as a jump in ANA's overseas cargo business helped offset a tiny rise in domestic passenger revenue and a downturn in its Japanese cargo business.

JAL also saw its international businesses offset laggard growth at home.

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JAL nine-month profit drops 12%, boosts full-year forecast

Japan Airlines said Friday its nine-month net profit dropped 12.2 per cent to $1.2 billion owing to higher operating costs, but the carrier boosted its full-year earnings forecast.

Net profit for April to December came in at 123.5 billion yen on sales of 989.9 billion yen, up 5.1 per cent from a year earlier.

The airline said it now expects to earn 148 billion yen in the fiscal year to March, up from an earlier forecast of 128 billion yen.

The company said its bottom line had been hit by a jump in operating expenses.

It did not elaborate, but a sharp drop in the yen since late 2012, while giving a boost to Japanese exporters, has hurt its airlines by pushing up the cost of fuel, often a carrier's single-biggest expense.

JAL and its domestic rival All Nippon Airways, which also reports its financial results Friday, were hit by the worldwide grounding of Boeing's next generation aircraft.

Both companies are Boeing's biggest customer for the the state-of-the-art plane.

Japan's thorny ties with neighbours also depressed demand for flights to South Korea and China.

Tokyo is embroiled in separate territorial spats with both countries.

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JAL Dreamliner hit by battery problem

Japan Airlines has grounded another one of its Dreamliner jets after "white smoke" was seen outside the cockpit window during maintenance, a year after the aircraft suffered a months-long global grounding over battery problems.

The carrier said that a technician at Tokyo's Narita airport, who was working on the parked plane before its departure to Bangkok Tuesday afternoon, first noticed what appeared to be smoke outside the cockpit window and then a battery system warning.

An investigation found that one of the eight lithium-ion cells in the plane's battery system had leaked, but its safety valve, which is designed to release excessive pressure, was properly open.

"The temperature of the cell was high. We believe it caused 'white smoke', which could be smoke or vapour," a JAL spokesman said.

The airline said it replaced the grounded plane with another Dreamliner, which left as scheduled, carrying 169 passengers and crew.

"We are making sure of the safety of every plane before its departure. We will continue regular flights (with Dreamliners)," a separate JAL spokesman, Norihisa Hanyu, told AFP.

In response to the Tuesday incident, US-based Boeing said the "improvements made to the 787 battery system last year appear to have worked as designed".

Boeing admitted in April that despite months of testing it did not know the root cause of the problems, but rolled out modifications it said would ensure the issue did not recur.

The measures comprised redesigning the battery and charger system and adding a steel box to prevent burning.

Since then, Dreamliners have experienced a series of minor glitches, including a fault with an air pressure sensor and the brake system.

In October, unflushable toilets caused JAL pilots to turn their plane around just after it left Moscow bound for Tokyo.

JAL's domestic rival All Nippon Airways (ANA) also said Wednesday it would continue flying the plane -- the pair are the aircraft's two biggest customers and have invested heavily in its success.

The incident was the latest for the Dreamliner since the trouble-plagued aircraft returned to service in the middle of last year following a months-long worldwide grounding.

The move was linked to a string of incidents, including a fire aboard a parked Dreamliner, which damaged the fuel-efficient jet's reputation and that of its manufacturer Boeing.

Investors appeared unfazed with JAL's Tokyo-listed shares up 1.52 per cent to 5,310 yen on Wednesday morning, while ANA was up 0.89 per cent to 225 yen, tracking a rise in the broader market.

Shares in the plane's Japanese battery supplier GS Yuasa slipped 0.85 per cent to 581 yen.

The Kyoto-based battery maker said it was "cooperating with Boeing and Japan Airlines on finding the cause" of the latest battery malfunction. It declined to elaborate further.

The US Federal Aviation Administration said it was working with Boeing and the Japan Civil Aviation Bureau to investigate, while the US National Transportation Safety Board said it was ready to assist Japanese authorities.

Officials at the Japanese transport ministry's air safety unit were not immediately available for comment Wednesday.

The number of 787s in operation worldwide had more than doubled from the 50 in service when the plane was grounded last year.

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Japanese airlines stop obeying China's air zone rules

Japanese airlines said Wednesday they had stopped following rules set by China when it unilaterally declared the right to manage the skies over the East China Sea.

The reversal comes after pressure from the Japanese government, which insisted China's announcement was invalid, and after governments around the world lined up alongside Tokyo.

Japan's two major airlines had previously said they had been submitting flight plans to Chinese authorities for any plane that was due to pass through the area, a key demand Beijing set out on Saturday when it said it had established an Air Defence Identification Zone (ADIZ).

The move heightened tensions in the region, where temperatures were already running high over the ownership of the Tokyo-controlled Senkaku islands, which Beijing says it owns and calls Diaoyu.

On Tuesday it was roundly condemned by Japan and its allies, including the United States, which flew two US B-52 bombers over the disputed islands in a show of force.

"After the Japanese government said private airlines don't have to follow Beijing's claims on Tuesday, our industry body held a meeting on Tuesday and decided we won't follow" Beijing's demands any more, a spokesman for former flag carrier Japan Airlines told AFP.

"JAL has stopped submitting flight plans since 0000am Wednesday (1500 GMT Tuesday)," he said.

JAL's rival All Nippon Airways also said it has stopped complying.

"The Scheduled Airlines Association of Japan, an aviation industry body, made the decision after it received assurances from China, through the Japanese foreign ministry, that Beijing has no intention of obstructing the flights of commercial airline carriers," the JAL spokesman said.

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JAL reports battery glitch on Dreamliner flight

Japan Airlines said on Monday it has reported to Boeing a possible glitch in the battery system on the 787 Dreamliner, after pilots saw an indicator warning light en route from Finland.

The alert was the latest in a growing line of problems that has beset the next-generation plane, including a months-long grounding earlier this year.

JAL said instruments warned pilots there was a problem with the battery connected to the plane's auxiliary power unit on the flight from Helsinki to Tokyo on Friday.

Engine monitoring systems showed the voltage and electrical current were within normal ranges and the plane arrived at Helsinki without delay, a JAL spokesman said.

"After its arrival we changed the auxiliary battery and charger, and the plane is now back in normal operation," he said.

JAL and chief rival All Nippon Airways (ANA), the single biggest operator of 787s, were among airlines hit by the worldwide grounding of Boeing's lightweight plane following problems with the lithium-ion batteries, including a fire.

Boeing admitted in April that despite months of testing it did not know the root cause of the problems, but rolled out modifications it said would ensure the issue did not recur.

The measures comprised redesigning the battery and charger system and adding a steel box to prevent burning.

Since then, Dreamliners have experienced a series of minor glitches, including a fault with an air pressure sensor and the brake system.

In October, unflushable toilets caused JAL pilots to turn their plane around just after it left Moscow bound for Tokyo.

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Japan Airlines H1 net profit slips 17.8% to US$833m

Japan Airlines said on Thursday net profit for the six months to September dropped 17.8 per cent to $833 million, as the strong yen and rising fuel costs bit into its bottom line.

But it boosted its outlook for the full year, striking an optimistic note on prospects for customer numbers on both domestic and international routes.

In a half that saw the grounding of its fleet of Boeing 787 Dreamliners after a series of safety glitches, the company said it had made 81.94 billion yen ($833 million), with an operating profit that was down 14.6 per cent at 95.84 billion.

Sales however edged up 4.0 per cent to 659.30 billion.

The numbers were healthier than main rival All Nippon Airways, which issued a grim earnings report, citing high fuel costs and the worldwide grounding of Boeing's next generation aircraft as contributing factors.

JAL, which returned to the market last year after a spectacular bankruptcy, did not give a specific reason for its weaker earnings.

But depreciation of the yen, which has slid to around 100 to the dollar compared with 80 a year ago, was seen amplifying the cost of fuel as well as user fees for international airports.

Japan's thorny ties with neighbours also depressed demand for flights to South Korea and China.

Tokyo is embroiled in separate territorial spats with both countries.

But JAL said revenues from its international services increased "despite the suspension of Boeing 787 flights and stagnant demand on Korea and China routes".

"On June 1, 2013, JAL resumed operation of the Boeing 787 on completing of all necessary safety measures, after battery problems grounded the fleet in January 2013 and caused substantial concerns and inconvenience," the company said.

JAL and ANA were sideswiped by the grounding of Boeing's new aircraft that began in January. After a long-running probe, the planes were allowed to fly again in June.

JAL said it increased the use of the fuel-efficient Dreamliner on international services to increase overall efficiency, while reducing Narita-Beijing flights because of shrinking demand.

Domestic services also fared well, with expanded routes and improved services such as better airport lounges.

Unlike ANA, which cut its full year profit forecasts by two-thirds, one-time flag carrier JAL upgraded its annual forecasts, citing strong demand for flights to Southeast Asia and cost cutting efforts.

The figures were also expected to benefit from an adjustment in foreign exchange movement and falling fuel prices.

The new net profit projection came to 128 billion yen, up from the previous estimate of 118 billion yen.

Operating profit is now expected to come in at 155 billion yen, compared with 140 billion yen, on sales of 1.286 trillion yen, up from 1.272 trillion yen.

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Qantas, Japan Airlines up stakes in Jetstar Japan

Australian flag carrier Qantas and Japan Airlines on Thursday boosted their stakes in Jetstar Japan by injecting a combined Aus$120 million (US$113.6 million) into the budget carrier.

Since it began flying in July last year, Jetstar Japan has become the country's largest budget airline and the money will help it expand further.

"The equity injection will support Jetstar Japan's future fleet and infrastructure growth, enabling the carrier to capitalise on the significant potential of the low-cost carrier market in the world's third largest economy," Qantas said in a statement to the Australian stock exchange.

The combined equity injection, in the form of non-voting shares, will see Qantas' and Japan Airlines' stakes in the carrier increase from 41.7 percent each to 45.7 percent.

Mitsubishi Corporation and Century Tokyo Leasing Corporation's holdings decrease from 8.3 percent each to 4.3 percent.

Jetstar Japan started operations in July last year and now operates a fleet of 18 aircraft to nine domestic destinations. It expects to grow the fleet to 24 planes.

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