JAL aim for lower fuel surcharges

Japan Airlines (JAL) filed with the Japanese Ministry of Land, Infrastructure, Transport and Tourism (MLIT) for a decrease in fuel surcharge for international cargo flights departing Japan, with effect from April 01, 2009.The international cargo fuel surcharge on long-haul international routes for flights departing Japan will decrease from 115 yen to 31 yen per kg. In the case of medium-haul international routes, the surcharge will decrease from 99 to 27 yen per kg, and on short-haul routes from 83 yen to 23 yen per kg, representing an overall reduction of up to 27% on all routes.

In addition, JAL has also filed with the MLIT to revise the procedure of setting its fuel surcharge levels. At present, adjustments are made 4 times a year (once every three months) using an index calculated from a three-month average fuel price of Singapore kerosene reported by the U.S Department of Energy (DOE). Starting from April 01, 2009, JAL will adjust its fuel surcharge levels on a monthly basis by using the one-month average fuel price of Singapore kerosene of the month before last. As the average fuel price of Singapore kerosene in February 2009 was US$52.77 per barrel, the benchmark fuel price used for calculation of the fuel surcharge level in April will be US$50.00 per barrel (refer to table below), resulting in the fuel surcharge reduction mentioned above.

JAL is conducting a wide range of countermeasures to limit the full impact of high fuel costs including fuel hedging, fuel consumption reductions, and the introduction of more fuel-efficient medium-sized aircraft to its freighter fleet. Despite these measures, the company is still reluctantly obliged to ask its international cargo customers to bear part of the burden caused by the unprecedented increase in the price of fuel over the past few years.

The JAL Group is Asia’s biggest airline group in terms of sales revenues and 2nd largest in Asia in terms of passengers carried annually. JAL Group airlines serve 214 airports in 33 countries and territories, including 60 airports in Japan. The international network covers over 240 passenger routes and 27 cargo routes, and the domestic network covers 156 routes.