Japanese budget carrier Skymark Airlines filed for bankruptcy protection yesterday, blaming a weak yen and a dispute with Airbus.
The low-cost carrier has liabilities of 71.09 billion yen ($603.6 million). Chief exdecutive Shinichi Nishikubo resigned and was replaced by board member Masakazu Arimori.
Skymark said Tokyo-based private equity firm Integral Corp has agreed to provide financing to help the airline restructure, pending court approval.
The airline’s down payments for Airbus A380 superjumbos and its fuel contracts became a difficult financial burden as the yen plunged last year, Skymark said.
Former internet entrepreneur Nishikubo had planned to use the A380s to offer cut-price business class tickets on lucrative routes such as New York to compete with Japan Airlines and All Nippon Airways.
But Airbus revoked a $2 billion contract for six A380s last summer and filed a law suit in December over a dispute with Skymark concerning unpaid deposits.
Skymark said: “The company, believing the demands for breach-of-contract payments were unreasonable, attempted to negotiate a reduction in the payments with Airbus but reached a situation in which there were concerns that payment for breach of contract would have worsened the company’s financial base.”
An Airbus spokeswoman told Reuters: “We are aware that Skymark Airlines has filed for bankruptcy protection, this is now a matter for the courts,”
JAL and ANA could now battle for control of Skymark and access to its valuable landing rights at Tokyo’s Haneda airport. The discount carrier holds 36 landing slots at Japan’s main domestic hub.
ANA and its affiliates and partners have about half of the 465 domestic slots at Haneda, with JAL controlling 184.5 of the daily landing rights.
Skymark, established in 1998, had projected a record net loss of 13.6 billion yen ($116 million) for the business year ending in March. The carrier said last month that it would hold talks with both JAL and ANA on code-share flights and seek more funds from investors.