PARIS – Air France said on Monday that it has informed its union representatives of planned voluntary departures that could concern up to 465 jobs in France due to overstaffing on the ground and increased competition, and plans to reduce its short-haul capacity.
The airline, whose parent company is Air France-KLM, said the voluntary departures will be carried out over a one-year period. However, there will be no forced redundancies, it said. Air France added that the plan will be subject to a consultation with “relevant stakeholders.”
The airline will reduce its short-haul operations in terms of passenger-seat capacity by 15 percent by the end of 2021, it said.
Air France named the rail network as its main rival in France and said that, “on routes where high-speed trains connect Paris to the provinces in under two hours, Air France has lost 90 percent of its market share.” The rapid development of low-cost airlines in the country has also affected the airline, it said.
Despite several initiatives to adapt to a tough environment, the decline in revenue could not have been prevented on some routes and unit costs could not be reduced.
“As a result, Air France’s financial situation has deteriorated significantly on its domestic network, and in 2018 it posted a loss of €189 million ($212.3 million), a sharp decrease compared to 2017 (€96 million). Since 2013, cumulative losses have amounted to €717 million,” it said.
During the past ten years, roughly 10,000 staff on the ground have left Air France, mainly through voluntary departure plans, a spokesman from the company said.
At the beginning of the month, parent company Air France-KLM reported widened losses for its first quarter of 2019. The Franco-Dutch carrier reported a quarterly loss of €320 million compared with a loss of €269 million a year earlier, while sales rose 3.1 percent. However, the airline confirmed its 2019 guidance.