Air France fights to get a grip on costs with 2,800 more job cuts

City A.M. Reporter
FRENCH airline Air France announced 2,800 fresh job cuts yesterday to help cope with weak air travel demand as it heads towards its sixth consecutive annual operating loss.

The carrier said it would no longer reach its target to break even this year, but said it was “imperative” to achieve that in 2014.

“We are in a period of weak demand,” chief executive Frederic Gagey told a news conference. “We have felt the full brunt of the cyclicality of air transport.”

Air France, part of Franco-Dutch group Air France-KLM, said it would begin negotiations with staff representatives from 4 October on new voluntary departure plans to cut an expected staff surplus next year. Air France has been hurt by the impact of Europe’s economic woes on demand for air travel, soaring fuel costs, and aggressive competition from low-cost carriers in the region and Gulf carriers on long-haul routes.

Air France is already cutting around 5,120 out of 49,300 staff on French contracts by the end of 2013 as part of plans which it unveiled in June last year. Air France added that it would further reduce capacity on French point-to-point routes out of Paris Orly airport and in its regional bases, while it would develop its Transavia European unit.