Japan Airlines Corp. announced it secured at least two-thirds of the votes from existing retirees to cut pension benefits by 30% — a key step in the government-backed restructuring of the troubled airline, according to a JAL spokeswoman.
About 67% of the 8,936 retired workers who voted agreed to the 30% benefit reduction. Earlier this month, about 91% of the company's existing employees agreed to a 50% cut in pension benefits.
The pension cost-cutting measures were required as part of the conditions set by the government in extending loans to keep the airline in operation. As of March 31, the JAL Group Pension Fund, Tokyo, had about 408 billion yen ($4.48 billion) in assets.
Separately, JAL shares plummeted by 45% today in Tokyo, trading to a record low of 37 yen per share, following speculation that the airline may file for bankruptcy. JAL has posted losses in three of the past four years.
In recent months, U.S. competitors Delta Air Lines and American Airlines — in partnership with private equity firm TPG — have been battling to invest in JAL, Asia's largest carrier, to take advantage of its Asian routes.