After a four-year courtship with All Nippon Airways, Mineta San Jose International Airport once again will have nonstop, regular service to Tokyo.
Expected to start next year, the flights offer the Silicon Valley airport a dose of optimism after losing carriers and millions of passenger trips and dollars in recent years.
“It means a lot of jobs and a lot of revenue for the airport,” Mayor Chuck Reed said Wednesday after the Japanese airline announced the new flights in Tokyo. Reed had flown to Japan in February — from San Francisco — for a sales pitch to ANA President and CEO Shinchiro Ito offering financial incentives to close the deal.
“We are confident that passenger demand to fly to San Jose will be high, not only in Japan but other Asian cities,” Ito said at a Tokyo news conference.
Japan’s second-largest carrier, All Nippon, has not set a schedule, said Bill Sherry, director of aviation at Mineta International. But he expects daily service from the start.
All Nippon also will start nonstop flights to Seattle at the same time. The two West Coast cities will be the first in the United States to welcome the airline’s new Boeing 787 Dreamliner. The long-awaited plane uses 20 percent less fuel than similar-size aircraft, making the midsize airliner a better fit for smaller airports such as Mineta wishing to tap faraway markets served mostly by jumbo jets.
From City Hall to high-tech offices and the Internet, news of the Mineta-to-Narita airport flights bounced around Silicon Valley with a breath of relief and even giddiness.
Paul Gallagher, a Mountain View executive, typically chalks up 150,000 to 250,000 air miles to East Asia and other destinations, but he must endure the hassle of getting to San Francisco International. The shorter, easier drive to San Jose for an All Nippon flight, “would provide a significant benefit and would remove about two hours from my door-to-door Asian ‘commute,’ ” said Gallagher, a vice president at Pelican Imaging Corp.
Meanwhile, Sherry said: “I think this is a huge deal.”
All Nippon’s arrival brings a much-needed boost to the struggling airport, Sherry said. Even before the airport completed a massive remodeling and expansion — for which it still owes about $1.5 billion — it suffered a series of hard, financial blows. First came the Great Recession and a dramatic drop in passenger travel. Then American Airlines demoted the airport from hub to a regular destination, with fewer AA flights coming through. In 2008, a spike in jet-fuel prices persuaded some airlines to shut their gates.
The airport has lost about a third of its scheduled flights and a quarter of its passenger traffic in the past three years, and more than a few employees lost their jobs or saw them turned over to outside contractors as the airport tried to cover costs.
“We’re building a great airport, but we have to retain and increase air service,” Sherry said. “We still have a mortgage to pay.”
However, Sherry said, the Tokyo flights won’t pay off for some time. That’s because it took some incentives to lure All Nippon, which was being wooed by several airports around the country. Sherry said San Jose has adopted a “risky” strategy to bring in more airlines.
As a long-distance hauler, All Nippon will receive the most generous package available. It won’t have to pay airport fees its first year and would receive a 66 percent discount the second year and a 33 percent discount the third. The airline would pay full charges after that. Although the airport gives up income from fees, Sherry said, it stands to earn significant dollars immediately from parking and concessions.
Even so, All Nippon had to be convinced there were enough Silicon Valley travelers to fill its planes. Reed, who led one of two task forces on airport competitiveness, said dozens of Silicon Valley executives and local business leaders met with Nippon executives and wrote letters to Ito, promising to book flights regularly.
Reed described their collective message this way: “If you build it, we’ll fly it.”
The influential Silicon Valley Leadership Group also lobbied All Nippon to fly to Mineta International. When the group surveyed its member companies, about 54 percent indicated they fly regularly to Tokyo, their most desired international destination from San Jose.
Reed and Sherry said the airline’s new Dreamliners also made it easier for the airline to dedicate at least one of the planes to the route. Usually, they said, airlines avoid upsetting their schedules and customers by transferring planes to other airports.
“Getting an airline to do that is like pulling teeth,” Sherry said.
The last direct flight from San Jose to Tokyo ended five years ago, when American Airlines canceled its direct flights after 17 years of service. Currently, the only international flights out of San Jose are to Guadalajara and Cabo San Lucas, Mexico.
Ito said his airline will use Narita airport as a hub for nonstop flights from San Jose and Seattle, allowing passengers to hop easily to other Asian destinations.
According to Hoover’s Inc., All Nippon currently operates 210 aircraft flying to 130 Japanese and 40 international destinations and employs 32,700 people. It reported a net income of $305 million on sales of $16.4 billion in the last fiscal year.
Contact Joe Rodriguez at jrodriguez@mercurynews.com or 408-920-5767.
