Future Challenges of Open Skies Agreements

JITI Aviation SeminarOctober 9th, 2015

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ANA Business Overview

Boeing 787 TTL 32

Boeing 777 TTL 54 Boeing 767 TTL 55

Airbus A320 TTL 18

Boeing 737 TTL 59

Bombardier DHC8 TTL 21

Including 6 aircraft operated by Vanilla Air (all leased aircraft)*As of Mar 31, 2015

64 consolidated subsidiaries and 18 equity-method subsidiaries and affiliates *

Operating revenue JPY 1,713 Billion *Operating income JPY 91.54 Billion *Net income JPY 39.24 Billion *

Number of employees 34,919 *

* As of March 31, 2015

Number of aircraft: 242

• Awarded SKYTRAX exclusive 5 star rating for the third year running (2013-15)

• The world’s Best Airport Services• The world’s Best Transpacific Airline

15th largest airline in the world by total passengers**

** IATA World Air Transport Statistics, 2014

ANA Business “STAGGERED”

Boeing 787-9 TTL 3

ANA Today

1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015P0

20,000

40,000

60,000

80,000

100,000

120,000

Domestic International

9/11 SARSLehman

shockEarthquake

2001 2003 2008 2011

1952

1986

1999

foundation

Internationalflight started

Star alliancemembership

60 bilASK

49 bilASK

50 milPax

As of March 2015

(mil ASK)

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ANA International Network

ChinaBeijingDalianShenyangQingdaoChengduShanghaiHangzhouGuangzhouXiamen

Rest of AsiaSeoulTaipeiHong KongYangonHo Chi MinhManilaBangkok

SingaporeJakartaDelhiMumbaiHanoiKuala Lumpur

North AmericaNew YorkWashington DCChicagoLos AngelesSan Francisco

San JoseSeattleHonoluluVancouverHouston

ANA Network

EuropeLondonParisFrankfurtMunichDusseldorf

* As of Sept., 2015

● ANA operates 952/w regular international passenger flight on 56 routes● In winter 2015, ANA will add Brussels and Sydney (58 routes in total)

ANA and Alliance Partners

As of April 2015

● ANA’s flights are marketed by 23 partners (15 from Star alliance)● ANA markets flights of 26 partners (18 from Star alliance)

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US-Japan Openskies & Trans-Pacific Market

● Japan-US Openskies enabled metal neutral JVs by JPN & US airlines● Passengers will enjoy choice out of three global alliances

NH=UA JV

JL=AA JV

DL’s on-line services

JL

JL

AA

UA

NH

NH

DL

DL

Asia AmericasCompetition among global alliances

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● Open market/de-regulation oriented● Entry barrier removed● Pro-competitive/efficient management

Open Skies Policy

Openskies increases users’ benefits through competition

● Protectionist/regulation oriented● Government dependent/spoiled management

Openskies

Set Back of Openskies

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Level Playing Field is essential for fair competition

Subsidy justification:

● MEIP (Market Economy Investor Principle)

Subsidy may be justified (case by case):

● Sustainable services for remote area

● Turn-around program for airlines in difficulty under open rules

● Fostering infant industry in developing countries

Level Playing Field and Subsidy

Increased users’ benefit through fair competition8

State Owned airlines

Fair competition among private and state owned airlines

Agenda for State Owned airlines

● Proper disclosure/transparency

● Privatization

● Independent from government influences

● Market oriented/efficient management

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Thanks.