TOKYO: ANA Holdings Inc. has decided on a plan to reduce the number of small aircraft it owns, in response to a plunge in demand for international flights amid the coronavirus crisis, informed sources told Jiji Press Saturday.

The move comes on top of the Japanese airline group’s decision to cut its fleet of large planes used for long-distance international flights.

The group will let go of small aircraft that have been used for long periods of time and have been costly in terms of maintenance, as it strives to improve profitability mainly for its domestic businesses.

The number of types of aircraft owned by ANA will also be slashed in order to cut maintenance costs.

According to sources familiar with the matter, ANA is expected to include the reduction plans in its business restructuring program to be announced on Tuesday.

Specifically, ANA will let go of some 30 Boeing 777 and other large, long-range aircraft with about 400 seats. Several other aircraft including small-size Boeing 737 with about 120 seats will also be reduced.

The reduction represents about 10 pct of the fleet of 300 planes currently owned by the entire ANA group.

Also being considered is a plan to shift small Airbus aircraft that are currently used on international routes to flight services on domestic routes.

As the asset values of the aircraft subject to the reduction have declined over the years, the company will book impairment losses in the current fiscal year ending in March 2021.

Although major losses will be booked, the streamlined fleet is expected to allow ANA to save maintenance costs. The fleet reduction plan will be a pillar of ANA’s efforts to slash fixed costs.

Amid the coronavirus crisis, All Nippon Airways of the ANA group has already reduced or suspended international flights using four domestic airports–Tokyo International Airport at Haneda, Narita International Airport in Chiba Prefecture, east of Tokyo, Kansai International Airport in the western Japan prefecture of Osaka and Chubu Centrair International Airport in Aichi Prefecture, central Japan.

The airline will consider reducing more flights over a medium term, as it remains unclear when COVID-19 will be contained. It plans to resume flights to and from Haneda before those using other airports in case travel demand recovers sharply for reasons such as the easing of overseas travel restrictions or the successful development of COVID-19 treatments.

JIJI Press