Nippon Yusen Air Transport Unit Cancels Expansion Plan

TOKYO (Nikkei)--Nippon Yusen KK has halted plans to expand its air transport operations due to slumping demand amid the economic downturn, company sources said Tuesday.

Subsidiary Nippon Cargo Airlines Co. (NCA) had intended to expand its fleet of eight cargo planes to 24 by 2013, which would have made it the nation's largest air transport company. NCA will maintain the current fleet size for the foreseeable future.

Nonetheless, the company has not canceled its order for 14 "747-8F" large cargo planes being developed by Boeing Co. of the U.S. It plans to lease out existing planes as they are replaced by new aircraft.

NCA posted a pretax loss of 18.8 billion yen for the year through March 2009 and forecasts a 20 billion yen loss for the current term.

(The Nikkei June 23 evening edition)