Coronavirus lockdown impact: Air France and sister airline to cut 7,580 jobs

Reuters


The French flag carrier, part of Franco-Dutch group Air France-KLM, said it had lost 15 million euros a day during the worst part of the crisis, which also saw its revenues plunge by 95%. It did not see traffic returning to 2019 levels before 2024.

As a result, it plans to cut 6,560 or 16% of jobs at the main airline by the end of 2022, more than 3,500 of which will come through natural departures, it said after union talks.

Another 1,020 jobs will go over the next three years at “HOP!”, representing 42% of staff at the regional carrier based in the coastal city of Nantes, which has also been hit by job cuts at planemaker Airbus (AIR.PA).

The French government – which granted Air France 7 billion euros ($7.9 billion) in aid, including state-backed loans, to help it to survive – has urged the airline to avoid compulsory layoffs, though it has conceded Air France is “on the edge.”

“A successful labour reorganisation is one where there are no forced departures,” junior economy minister Agnes Pannier-Runacher told Sud Radio on Friday.

In its statement, Air France said it would give priority to voluntary departures, early retirement and staff mobility. It did not rule out compulsory redundancies, however.

The reconstruction plan will be presented at the end of July, together with a plan for the wider Air France-KLM Group.

Some 100 union members and employees, from cleaning staff to check-in assistants, demonstrated earlier outside the airline’s base at Charles de Gaulle airport against plans to cut staff after receiving state aid to absorb the pandemic fallout.

“It’s scandalous. The government is putting in 7 billion euros and the company is destroying jobs,” said 62-year-old Annick Blanchemin, who works as ground staff for the airline.

“They’ll push me to retire but I won’t get my maximum pension this way. And this is not how I wanted to leave.”

In Nantes, where HOP! is based, employees also erected banners in protest on Friday.

The shake-up was expected after sources familiar with the matter said that at least half of the cuts were likely to entail voluntary departures and retirement plans.

The government, which is being reshuffled under a new prime minister nominated on Friday, has also expressed concerns about Airbus’s (AIR.PA) plans to cut some 15,000 jobs across Europe – with a third of those in France.

A wave of restructuring triggered by the virus outbreak is hitting airlines and industrial firms across Europe.

Under CEO Ben Smith, who joined from Air Canada in 2018, Air France-KLM has sought to cut costs, improve French labour relations and overcome governance squabbles between France and the Netherlands, each owners of close to 14% of the group.

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