Air France ties short-haul future to cost cuts (Reuters)

April 11, 2012

Loss-making Air France called on Monday for increased efforts to overhaul its European passenger network and signalled the survival of its short- and medium-haul operations depended on the willingness of staff to accept “drastic” cost cuts.

The French arm of Franco-Dutch group Air France-KLM (AIRF.PA) said it needed to reduce its controllable costs by 20 percent, in part by extending a high-productivity formula thrashed out at regional bases to Orly, Paris’ second airport.

But unions have warned of job cuts as a result of new labour contracts due to be signed in June, when a second phase of the company’s existing restructuring plan is due.

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