Air France to slash more than 5,000 jobs

Air France will invest in its long-haul services

Air France has announced a new restructuring plan which will lead to the loss of more than 5,000 jobs.

By the end of 2014, the French national carrier said it is aiming to cut payroll costs by 20%. From December 2011 to December 2013, the airline will reduce its workforce by 5,122 jobs, or 10% of its total staff. Of this total, an estimated 1,712 will be “natural departures”, with staff not being replaced. The remaining 3,410 will be removed through a variety of methods, including incentivised voluntary retirement and redundancy schemes, offering incentives for staff to switch to part-time work, and a shared working plan for cabin and flight deck crew. Air France added that “forced departures” will be avoided.

“Air France is facing a fundamental choice about its future. Our business plan has two ambitions: to ensure Air France returns to profitability and to better serve our customers. If we all make the necessary equitably distributed efforts, there will be no forced departures. The signature of the agreements in the next few days will involve all Air France staff and will illustrate everyone’s determination to put Air France back on the road to recovery. I have every faith in the success of our plan, which will enable Air France to return to the forefront of the major international airlines”, said Alexandre de Juniac, Chairman & CEO of Air France.

The airline also said it plans to restructure its short- and medium-haul operations, while repositioning its long-haul offerings.  A major investment, which Air France said would total “several hundred million euros” will boost products and services on long-haul routes, largely focusing on premium cabins.  The airline will also increase the use of new airport technology to boost productivity.

Air France slumped to a loss of EUR809 million (US$1.02bn) loss in full-year 2011, and EUR483m for the first quarter of 2012.

By Mark Elliott, 22 June 2012, Friday 12:45 AM