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Budget airline files for bankruptcy

Thursday, January 29, 2015 - 01:01

Japanese budget carrier Skymark files for bankruptcy, blaming weakening yen and a dispute with Airbus. Kirsty Basset reports.

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Budget Japanese airline Skymark is filing for bankruptcy - with over $600 million in liabilities. Director Masakazu Arimori apologised - and said currency fluctuations were partly to blame. (SOUNDBITE) (Japanese) SKYMARK DIRECTOR, MASAKAZU ARIMORI, SAYING: "Due to the increasing competitiveness of other companies, the weakening yen, and increasing fuel prices our earnings and performance suddenly declined." A dispute with Airbus also worsened the company's financial position - Skymark was facing penalty payments from Airbus after cancelling its A380 contracts. (SOUNDBITE) (Japanese) SKYMARK DIRECTOR, MASAKAZU ARIMORI, SAYING: "We had been paying for the lease on the aircraft in dollars and with the sudden weakening of the yen, the burden of those payments suddenly increased." Airbus says it's now a matter for the courts. Skymark had also been struggling to compete with Japan's two major carriers - ANA and Japan Airlines. The bankruptcy could now spark a tussle for control of the company and access to valuable landing rights in Tokyo. The company will delist on March 1.

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Budget airline files for bankruptcy

Thursday, January 29, 2015 - 01:01