Japan Airlines faces a deficit, while NTT DoCoMo buys a major stake in Tower Records Japan. This and more in our weekly look at business news in Japan.
There was bad news this week for Japan Airlines, which is Asia's biggest airline company in terms of sales. The company faces a loss for the full year because of higher fuel costs and a series of safety incidents. The airline announced it had lost nearly $102 million during the six months to September 30. Only a year ago the company made $780 million in profit.
To offset the loss, the company plans to wages by 10 percent.
Stephen Pearlman, a JAL spokesman, says there were also other reasons for the airline's loss, including Japan's poor relationship with China.
"Demand out of Japan to China and Asia, which are both big destinations for Japanese tourists and business has been slow to recover," said Stephen Pearlman. "The key reasons for this are the anti-Japan demonstrations in China in April of this year and also the lingering effects of the tsunami in December of last year and continuing concerns about terrorism."
Japan's largest provider of mobile phone services will soon become the major shareholder in Tower Records Japan. NTT DoCoMo will buy a 42 percent stake in Tower Records Japan. Tower Records is the largest retailer of recorded music in Japan.
To stay competitive against newcomers entering an already saturated mobile phone market, DoCoMo will offer consumers more electronic payment services. For example, with Tower Records as a member of the team, DoCoMo subscribers will be able to buy CDs and get discount vouchers at any of Tower Records' 100 stores in Japan.
More and more Japanese consumers are shopping online, downloading games, booking train tickets and tapping into other services through their mobile phones. Docomo says more than 30 percent of its subscribers make electronic payments on their phones.
Japan's largest oil developer, Impex Company, and its third largest oil developer, Teikoku Company, will merge in an effort to compete in the global market.
The merged Japanese companies will pump about 10 percent of Japan's entire daily crude oil imports.
They will also increase their output in Africa and South America. The merger will be finalized in April.