JAL said in a statement that the new carrier, due to be set up this July as a group subsidiary, would run medium to long-haul international services between Tokyo's Narita International Airport and major cities in Asia, the United States and Europe from the summer of 2020.  

It will start operations with two mid-sized Boeing 787-8 aircraft.

"We want to play a role in boosting foreign travellers to Japan," JAL President Yuji Akasaka was reported as saying by Kyodo News at a press conference in Tokyo.

JAL’s participation in the budget flight market has thus far been restricted to a 33.3 per cent stake in Jetstar Japan, which it owns along with Australia's Qantas Group.

Jetstar only operates domestic flights and short-haul international flights between Japan and Asian cities.

With the new carrier, JAL "aims to create new demand, working along with the successful services provided by Jetstar Japan".

In June 2015, Tokyo 2020 announced JAL and All Nippon Airways (ANA) as its first official partners, under the category of "Passenger air transportation services".

ANA’s contract with Tokyo 2020 is effective until December 31, 2020, as is that of JAL, which will actively participate as a member of the "All Japan" team, supporting the efforts of Japan's national Olympic and Paralympic teams.

In March, ANA announced that it will integrate its low-cost carrier affiliates Peach Aviation and Vanilla Air to create Japan's largest budget carrier after Jetstar.

The middle-distance international carrier, which will be named Peach, is due to begin services within Asia around 2020.

According to local media, Japan's low-cost carrier market is expected to rise from about 10 per cent of domestic flight passengers to some 30 per cent in the near future.