Shares in Japan Airlines fell a further 80% today during trading in Japan following a 45% drop yesterday (Tuesday 12) as bankruptcy looks inevitable.

The stricken carrier’s shares are almost worthless at 7Yen after the Japanese Government indicated that it would allow the flag carrier to slip into administration as soon as Tuesday (January 19).

Yet despite its woes a number of airlines and alliances are offering huge sums of cash to help it stay afloat as it remains a key carrier on lucrative Far East routes.

British Airways – keen to keep JAL as part of the Oneworld Alliance proposed a slot-sharing plan on key routes between Japan and Europe, as well as launching a new route to Haneda, near Tokyo. The deal could generate up to £200m a year.

Fellow Alliance partners American Airlines, Qantas and Cathay Pacific have also agreed to help bail out the airline.

American Airlines has raised its joint offer of an investment in JAL, together with the private equity firm TPG, by $300 million, to $1.4 billion.
American also pledged a $100 million annual sales increase for JAL if it stayed with Oneworld.
Qantas meanwhile said it would help JAL on setting up a low-cost carrier offshoot.
Rival alliance member Delta Air Lines has offered $500 million in equity, as well as a large increase in passengers and revenue from the SkyTeam alliance.
Yesterday, the airline secured agreement to cut pensions by a third.

The agreement should help JAL, which is saddled with $15bn in debt – a quarter of which is made up of pensions.

The airline is also looking at massive cuts in its workforce in a bid to stem its huge losses, which topped $1.5bn in the six months to September.

The scale and speed of JAL’s collapse has shocked Japan and dented its national pride.

JAL enjoyed spectacular growth in the 60s and 70s mirroring the country’s economic glory days.

However, a series of bad investments and soaring staff costs together with the economic crisis and swine flu has left it on the brink of collapse.