August 5, 2008
Sagawa Group Cargo Airline to Halt Services
Tokyo, Aug. 5 (Jiji Press)--Galaxy Airlines, an air cargo arm of Japanese transportation service group SG Holdings Co., said Tuesday it will shut down all four of its domestic routes on Oct. 5 because of soaring fuel costs.
SG Holdings, which has Sagawa Express Co. as a key operating unit, is considering liquidating the cargo airline.Nobuaki Kondo, board director of SG Holdings, said at a press conference that operating costs including fuel expenses and maintenance fees far exceed forecasts.
SG Holdings tried to keep the cargo airline alive, but failed to gain the understanding of other shareholders, he said.
Galaxy Airlines' shareholders include Mitsui & Co. , Japan Airlines and Sumitomo Corp. .
Galaxy Airlines, which started operations in 2006, logged excess liabilities of 2.1 billion yen for the year ended last March with an operating loss of 3 billion yen.END
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