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Paris attacks: Air France sees takings dip by €70m

Franco-Dutch airline group Air France-KLM said Monday that the November 13th terror attacks in Paris reduced its December turnover by an estimated €70 million ($76.42 million).

Published: 11 January 2016 08:28 CET

Paris attacks: Air France sees takings dip by €70m

But the effect had largely tailed off over the past two weeks, it added.

“The negative impact of the Paris attacks on December revenues is estimated to be around €70 million, with significant easing during the last two weeks. Booking trends in December were in line with a progressive recovery,” the group said in a press release.

Total traffic in December for Air France, KLM and low-cost subsidiaries HOP! and Transavia, was 6.7 million passengers, “stable” over the previous month.

Seat occupancy was 82.9 percent, a fall of 0.2 percent, it said.

Turnover in November fell by around €50 million euros as a result of the attacks, Air France-KLM said last month.

The group said earlier this month that it expected to return to profit in 2015 after several years of losses. Annual results are scheduled to be announced in February.

The November 13th attacks by jihadists on street cafes, a concert hall and the Stade de France national stadium left 130 dead and 350 injured.

Air France, Hop! to cut 7,580 jobs

An Air France plane lands at JFK airport in New York. Image: STAN HONDA / AFP

The carrier wants to get rid of 6,560 positions of the 41,000 at Air France, and 1,020 positions of the 2,420 at Hop!, according to a statement issued after meetings between managers and staff representatives.

“For three months, Air France's activity and turnover have plummeted 95 percent, and at the height of the crisis, the company lost 15 million euros a day,” said the group, which anticipated a “very slow” recovery.

The aviation industry has been hammered by the travel restrictions imposed to contain the virus outbreak, with firms worldwide still uncertain when they will be able to get grounded planes back into the air.

Air France said it wanted to begin a “transformation that rests mainly on changing the model of its domestic activity, reorganising its support functions and pursuing the reduction of its external and internal costs”.

The planned job cuts amount to 16 percent of Air France's staff and 40 percent of those at Hop!

With the focus on short-haul flights, management is counting mainly on the non-replacement of retiring workers or voluntary departures and increasing geographic mobility.

However, unions warn that Air France may resort to layoffs for the first time, if not enough staff agree to leave or move to other locations.

'Crisis is brutal'

Shaken heavily by the coronavirus crisis, like the entire aviation sector, the Air France group launched a reconstruction plan aiming to reduce its loss-making French network by 40 percent through the end of 2021.

“The crisis is brutal and these measures are on an unprecedented scale,” CEO Anne Rigail conceded in a message to employees, a copy of which AFP obtained. They also include, she said, “salary curbs with a freeze on general and individual increases (outside seniority and promotions) for all in 2021 and 2022,” including executives of Air France.

The airline told AFP earlier this week that: “The lasting drop in activity and the economic context due to the COVID-19 crisis require the acceleration of Air France's transformation.”

Air France-KLM posted a loss of 1.8 billion euros in the first quarter alone, and has warned it could be years before operations return to pre-coronavirus levels.

Air France has been offered seven billion euros in emergency loans from the French state or backed by it, while the Dutch government approved a 3.4 billion euro package of bailout loans for KLM last week.

The group joins a long list of airlines that have announced job cuts in recent weeks.

Lufthansa is to slash 22,000 jobs, British Airways 12,000, Delta Air Lines 10,000 and Qantas 6,000.

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