Even if airlines had the financial capacity to expand everywhere in the world, national regulations would limit expansion. With few exceptions, airlines cannot fly on lucrative domestic routes in foreign countries. For example, JAL cannot compete on the New York to Los Angeles route, nor can AA fly between Tokyo and Nagoya. Further, the U.S. government limits foreign ownership in a U.S. airline to 25 percent of voting stock.
Thus, airlines cannot easily control a flight network abroad that will feed passengers into their international flights. JAL has no U.S. domestic flights to take passengers into Chicago for connections to Tokyo, while AA has scores of such filgts. However, JAL does have an advantage within Japan.
Finally, airlines usually cannot service pairs of foreign countries. AA cannot fly between Brazil and South Africa because those governments give landing rights on such routes only to Brazilian and South African airlines. To avoid these restrictions, airlines must ally themselves with carriers from other countries.