Alexandre de Juniac unveils the main axes of the transformation of AF [merged]
May 21, 2012, 7:45 am
#16
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Translation:
Air France to implement a voluntary redundancy plan. The CEO, Alexandre de Juniac, is in a situation that could be compared to 1993.
Would the history of Air France be in the process of repeating itself? Almost twenty years ago, Christian Blanc, former president of the RATP, took the control of the state owned company on the brink of bankruptcy. Air France's debt reached 36 billion francs for a turnover of 57 billion francs and lost over 7 billion. "We're not far from what we lived in 1993, said Gilles Bordes-Pages, director of strategic relations at Air France and then pilot representative on the board. The difference is that state ownership was guilty of not having played its part. It injected 20 billion francs for the recapitalization. "The Blanc plan, submitted to a referendum, led to 5,000 job cuts.
On the program: increased work, wage cuts ... "In 1993, the company recover was easier, said Gilles Bordes-Pages, you could build on the techniques of "revenue management" implemented in the United States, establish a hub with a domestic network that supplied the long haul network... Air France did not face competition from low-cost carriers on short-and medium-haul and Asian companies and the Gulf over the long haul. This time, there is not such leverage. The only parameter which can be played today is cost. "
Air France to implement a voluntary redundancy plan. The CEO, Alexandre de Juniac, is in a situation that could be compared to 1993.
Would the history of Air France be in the process of repeating itself? Almost twenty years ago, Christian Blanc, former president of the RATP, took the control of the state owned company on the brink of bankruptcy. Air France's debt reached 36 billion francs for a turnover of 57 billion francs and lost over 7 billion. "We're not far from what we lived in 1993, said Gilles Bordes-Pages, director of strategic relations at Air France and then pilot representative on the board. The difference is that state ownership was guilty of not having played its part. It injected 20 billion francs for the recapitalization. "The Blanc plan, submitted to a referendum, led to 5,000 job cuts.
On the program: increased work, wage cuts ... "In 1993, the company recover was easier, said Gilles Bordes-Pages, you could build on the techniques of "revenue management" implemented in the United States, establish a hub with a domestic network that supplied the long haul network... Air France did not face competition from low-cost carriers on short-and medium-haul and Asian companies and the Gulf over the long haul. This time, there is not such leverage. The only parameter which can be played today is cost. "
Let's hope so after the disastrous business plan of Gougeon when he was Nr 2 and then 1. Strange though that Spinetta is still around as he bears a lot of responsibility in the sore state of AF.
Implied in the Figaro article is that the French government should first inject several billions into AF. AF looks a lot like Greece; it needs bailout money but it also needs huge structural reform. AF staff will not be willing to accept austerity more easily than Greeks. And any bailout money will be wasted and simply postponing the day of reckoning as in Greece.
May 22, 2012, 4:03 am
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I think AF's total workforce in 2011 was around 58 500 employees?
May 22, 2012, 5:37 am
#18
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So de Juniac is the new Blanc?
Let's hope so after the disastrous business plan of Gougeon when he was Nr 2 and then 1. Strange though that Spinetta is still around as he bears a lot of responsibility in the sore state of AF.
Implied in the Figaro article is that the French government should first inject several billions into AF. AF looks a lot like Greece; it needs bailout money but it also needs huge structural reform. AF staff will not be willing to accept austerity more easily than Greeks. And any bailout money will be wasted and simply postponing the day of reckoning as in Greece.
Let's hope so after the disastrous business plan of Gougeon when he was Nr 2 and then 1. Strange though that Spinetta is still around as he bears a lot of responsibility in the sore state of AF.
Implied in the Figaro article is that the French government should first inject several billions into AF. AF looks a lot like Greece; it needs bailout money but it also needs huge structural reform. AF staff will not be willing to accept austerity more easily than Greeks. And any bailout money will be wasted and simply postponing the day of reckoning as in Greece.
Anyway France has no money, except borrowed money.
Overall I think you are right, and the AF staff hardliners will keep living in denial of the truth.
Brace yourselves for lots and lots more strikes at AF.
One more reason for me to avoid them like the plague.
May 22, 2012, 7:21 am
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Under the EU rules I think the french goverment will find it very hard to inject money into AF.
Anyway France has no money, except borrowed money.
Overall I think you are right, and the AF staff hardliners will keep living in denial of the truth.
Brace yourselves for lots and lots more strikes at AF.
One more reason for me to avoid them like the plague.
Anyway France has no money, except borrowed money.
Overall I think you are right, and the AF staff hardliners will keep living in denial of the truth.
Brace yourselves for lots and lots more strikes at AF.
One more reason for me to avoid them like the plague.
Of course, there are always some indirect ways to subsidize, but most are already extensively used.
One question is who will pay the early-retirement indemnities??? AF or the State?
May 22, 2012, 7:55 am
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Hmm. So I read the full article and it has some interesting details.
They expect to save costs by handling leisure destinations to transavia, cutting costs on long-haul economy, less cargo-only transporters and less maintenance costs.
There is also some improvement in the long-haul business class.
I really do hope that Le Figaro is wrong because I do not see this as a sensible strategy.
There's not much more that can be removed from the long-haul economy and save money.
I sat in a JNB-CDG A380 on Sunday and was basically horrified. It was my first Y long-haul flight since 2009 and I did not enjoy it at all.
The seats are tiny and terribly uncomfortable, the plane is packed with 3-4-3 on the lower deck and 2-4-2 on the upper deck in Eco. Premium Eco is 2-3-2 with slightly better seats and business is nothing to speak of with the slanted seat either...
Food was rather uninspiring and one choice only, the second choice seemed to have run out.
Cabin service was kept to the absolute minimum. I saw the crew during the mandatory drink and food run and that's it. If you wanted something during the flight, it's time to get up and find your way back to the galley and ask. This leads to people constantly getting up. Other carriers do something like a 30min drink run: During the night a flight attendant just walks through the plane with a tray of drinks. No need for the passengers to get up etc. and the cabin is calmer.
I really do not see where one could save any money there.
They expect to save costs by handling leisure destinations to transavia, cutting costs on long-haul economy, less cargo-only transporters and less maintenance costs.
There is also some improvement in the long-haul business class.
I really do hope that Le Figaro is wrong because I do not see this as a sensible strategy.
There's not much more that can be removed from the long-haul economy and save money.
I sat in a JNB-CDG A380 on Sunday and was basically horrified. It was my first Y long-haul flight since 2009 and I did not enjoy it at all.
The seats are tiny and terribly uncomfortable, the plane is packed with 3-4-3 on the lower deck and 2-4-2 on the upper deck in Eco. Premium Eco is 2-3-2 with slightly better seats and business is nothing to speak of with the slanted seat either...
Food was rather uninspiring and one choice only, the second choice seemed to have run out.
Cabin service was kept to the absolute minimum. I saw the crew during the mandatory drink and food run and that's it. If you wanted something during the flight, it's time to get up and find your way back to the galley and ask. This leads to people constantly getting up. Other carriers do something like a 30min drink run: During the night a flight attendant just walks through the plane with a tray of drinks. No need for the passengers to get up etc. and the cabin is calmer.
I really do not see where one could save any money there.
May 22, 2012, 10:46 am
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Hmm. So I read the full article and it has some interesting details.
They expect to save costs by handling leisure destinations to transavia, cutting costs on long-haul economy, less cargo-only transporters and less maintenance costs.
There is also some improvement in the long-haul business class.
I really do hope that Le Figaro is wrong because I do not see this as a sensible strategy.
There's not much more that can be removed from the long-haul economy and save money.
I sat in a JNB-CDG A380 on Sunday and was basically horrified. It was my first Y long-haul flight since 2009 and I did not enjoy it at all.
The seats are tiny and terribly uncomfortable, the plane is packed with 3-4-3 on the lower deck and 2-4-2 on the upper deck in Eco. Premium Eco is 2-3-2 with slightly better seats and business is nothing to speak of with the slanted seat either...
Food was rather uninspiring and one choice only, the second choice seemed to have run out.
Cabin service was kept to the absolute minimum. I saw the crew during the mandatory drink and food run and that's it. If you wanted something during the flight, it's time to get up and find your way back to the galley and ask. This leads to people constantly getting up. Other carriers do something like a 30min drink run: During the night a flight attendant just walks through the plane with a tray of drinks. No need for the passengers to get up etc. and the cabin is calmer.
I really do not see where one could save any money there.
They expect to save costs by handling leisure destinations to transavia, cutting costs on long-haul economy, less cargo-only transporters and less maintenance costs.
There is also some improvement in the long-haul business class.
I really do hope that Le Figaro is wrong because I do not see this as a sensible strategy.
There's not much more that can be removed from the long-haul economy and save money.
I sat in a JNB-CDG A380 on Sunday and was basically horrified. It was my first Y long-haul flight since 2009 and I did not enjoy it at all.
The seats are tiny and terribly uncomfortable, the plane is packed with 3-4-3 on the lower deck and 2-4-2 on the upper deck in Eco. Premium Eco is 2-3-2 with slightly better seats and business is nothing to speak of with the slanted seat either...
Food was rather uninspiring and one choice only, the second choice seemed to have run out.
Cabin service was kept to the absolute minimum. I saw the crew during the mandatory drink and food run and that's it. If you wanted something during the flight, it's time to get up and find your way back to the galley and ask. This leads to people constantly getting up. Other carriers do something like a 30min drink run: During the night a flight attendant just walks through the plane with a tray of drinks. No need for the passengers to get up etc. and the cabin is calmer.
I really do not see where one could save any money there.
you can get rid of champagne and alcoholic drinks altogether, you can get rid of the free newspapers (and magazines on long haul), you can more strictly enforce luggage weight limits, and mostly you can get rid of some staff on each plane. This being said, joke apart, I do not share your view on AF long haul Y. In my experience it is pretty good except on 777s. I find the seats more comfortable than the competition, food much better than, say, on BA or KL Y, drinks better, entertainement very good, and crew usually very nice.Back to the point of the 'rumour', I note that AF denies that they are aiming at reducing workforce voluntarily by 5000, I think it is mostly a shame because ultimately, what makes AF so much more expensive to run than other airlines is solely labour costs. All else is roughly in line with competitors, but labour costs are not. By nature, I have an absolute hatred for compulsory redundancy so I would much rather they relied on voluntary early retirement or partial non-replacement of retiring staff than engage in something more aggressive or more fractious. To me it is the only solution they have.
May 22, 2012, 3:52 pm
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May 22, 2012, 11:26 pm
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France has had early-retirement benefits and various other voluntary lay-off benefits that apply to every company. One can easily argue that this is a country-wide law and that the benefits are part of the high contribution paid by employers/employees to the various social systems (including retirement system). Of course, if a specific system of State support was designed for AF, that would be illegal.
May 23, 2012, 2:02 am
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Not so obvious.
France has had early-retirement benefits and various other voluntary lay-off benefits that apply to every company. One can easily argue that this is a country-wide law and that the benefits are part of the high contribution paid by employers/employees to the various social systems (including retirement system). Of course, if a specific system of State support was designed for AF, that would be illegal.
France has had early-retirement benefits and various other voluntary lay-off benefits that apply to every company. One can easily argue that this is a country-wide law and that the benefits are part of the high contribution paid by employers/employees to the various social systems (including retirement system). Of course, if a specific system of State support was designed for AF, that would be illegal.
May 23, 2012, 4:00 am
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May 23, 2012, 4:02 am
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May 23, 2012, 1:14 pm
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May 23, 2012, 1:16 pm
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May 23, 2012, 1:41 pm
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May 23, 2012, 1:55 pm
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Sadly it has indeed, but the public and ex public ones have been way over-represented (in part because the system is mostly applied in large companies and many of French largest companies in sectors like transport and telecommunication were historically nationalised).