Air France counts the cost

Staff at strike-hit Air France again rejected a company pay offer last week, forcing the resignation of CEO Jean-Marc Janaillac (BTN last week). He is expected to step down officially on Wednesday.

More strikes are now expected.

"This is an enormous mess that will only put a smile on the faces of our competitors," Janaillac said after the vote. He added he hoped his departure would spark "a more acute collective awareness”.

Air France-KLM had already warned its 2018 operating profit would be “notably below” last year’s figure because of the financial impact of the strikes plus currency fluctuations and a fuel bill €350m (£310m) higher than last year’s.

In the latest ballot, open to all staff, not just union members, 55% voted against the latest offer of a 7% pay rise over the next four years. Union negotiators have been demanding a 5.1% increase this year.

Janaillac had been trying to cut costs at Air France-KLM following the example of other airlines including British Airways and Lufthansa amid rising competition from low-cost airlines and Gulf national carriers.

Aviation consultant John Strickland told the BBC: “There is inevitably some pain for staff when structural changes are made, but once that is dealt with, you're left with a much healthier company.”

www.airfrance.co.uk

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