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Tuesday 19 January, 2010

Good morning

A very short note to update you on some neutral news, and with a bonus piece of good news as well.

Neutral news is that Japan Airlines today declared bankruptcy.  However, the impact on us as passengers is probably close to zero.  As is so often the case in this country, its bankruptcy filing is merely part of a restructuring strategy (the cynics would say 'stiff the current shareholders and find a new bunch of suckers to replace them' but it is of course more complex than that) and it says it will remain flying all scheduled services as normal.

Well, expect those scheduled services to be cut back in the days/week/months that follow (the airline has announced plans to reduce the number of domestic routes to 119 from 136 and the number of international routes to 79 from 93) but for now if you're on a JL flight in the next little while, it almost certainly will operate as normal.

Rather than see the airline accept a cash investment from a foreign airline (both AA and DL were/are extremely anxious to hop into bed with JL), Japan's Enterprise Turnaround Initiative Corporation is giving the airline $11 billion from a state-backed fund to re-bankroll the company.  This is the third time in ten years the airline has been bailed out by the government, but the first time it actually declared bankruptcy.

JL has also appointed a new CEO, the retired founder of Kyocera, by all accounts a very successful and driven individual, and perhaps his lack of airline experience might prove a plus rather than minus.

Here's an interesting side effect of JAL's bankruptcy.  Its fuel hedging contracts were voided as part of the process, and that has apparently caused an early drop of $1.73/barrel in oil prices for March delivery, although prices started to firm again after that sudden dip.  It is an ill wind that blows no good.

The good news - a BA sale to Europe, from all 19 of their US gateways, good for travel through 28 March and must be purchased by 28 January.  Choose from either airfare only or air plus hotel package.  Details on their website.

Lastly, a mention of our Scotland's Highlands and Islands tour.  We've had another couple sign up and need just one more couple (or two singles) to make this a guaranteed tour.  Please do consider this lovely experience and come join a small group of your fellow Travel Insiders as we travel through some of the loveliest and least spoiled parts of Scotland this June.

Stay tuned for the regular newsletter on Friday, and until then, please enjoy safe travels

David M Rowell aka The Travel Insider

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