Category Archives: Transavia Airlines (France)

Transavia France introduces its new Bostik adhesives logo jet

Transavia France (Paris) has issued this statement about its new Bostik Boeing 737-800 logo jet:

For the first time in France, a Boeing 737-800 from the fleet of Air France-KLM subsidiary, Transavia, features a unique livery and logo which will promote Bostik’s new branding and identity across Europe. This unique contract between two French companies with international ambitions and operations highlights the expertise of Bostik, a specialist in adhesives for aerospace applications.

Bostik logo
According to the airline, “With a 250 square-meter airborne display of its new graphic identity, Bostik has people talking and has demonstrated that when it comes to performance, the sky’s the limit. The international manufacturer of adhesives for the industrial, construction and consumer markets unveiled the re-branded Boeing 737-800 airplane today during a press conference at Orly airport in advance of the aircraft’s inaugural flight.

Bostik and its parent company, Arkema, will use this high-profile Europe-wide campaign to promote their expertise in the adhesives and materials used by aircraft manufacturers which are designed to meet the industry’s exacting specifications.
Top-flight innovation from a leader in adhesives

As a partner to the aerospace industry since 1954, Bostik has developed numerous adhesive solutions designed specifically for aircraft applications. Although invisible to passengers, these high-technology products play a critical role in safety and comfort, helping to ease cabin vibration during take-off and landing and reducing noise throughout the flight. Bostik became a member the Arkema family in early 2015. Together, the two companies offer a broad array of products for the aerospace industry, including innovative solutions to join difficult materials, strengthen others and reduce aircraft weight.

The “Bostik airplane” will fly to 47 destinations in Europe in 20 different countries until the end of November 2015, making two round-trip flights per day. In all, 145,000 passengers will travel on the Bostik airplane over the next six months and millions of others will have a chance to admire it at Orly Sud, its main hub, and during layovers.

Bostik became a member of Arkema in February 2015 and accounts for 25% of the Group’s business. Bostik is a leading global adhesive specialist in industrial manufacturing, construction and consumer markets. For more than 125 years, we have been developing innovative adhesive solutions that are smarter and more adaptive to the forces that shape our daily lives. From cradle to office and from home to worksite, Bostik’s smart adhesives can be found everywhere. With 2014 sales of €1.5 billion, the company employs 4,900 people and has a presence in more than fifty countries.

Copyright Photo: Manuel Negrerie/AirlinersGallery.com. Boeing 737-8K2 F-GZHG (msn 30650) in the new Bostik special livery arrives at the Paris (Orly) Base.

Transavia France aircraft slide show: AG Airline Slide Show

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Air France-KLM outlines the changes and strategies for their Summer Schedule

Air France (Paris) and KLM Royal Dutch Airlines (Amsterdam) have outlines the changes for its upcoming Summer Schedule effective from March 29 through October 24, 2015. Overall the Air France-KLM Group capacity is increasing (+ 1.7%) compared with the summer 2014 season.

Long-haul operations are increasing by 1.8%. Medium-haul activity is continuing its reorganization and is decreasing by 1.9%. Transavia’s low cost operations (+ 7.8%) are undergoing strong development in France and are being consolidated in the Netherlands.

Here are the highlights:

Long-haul: Air France-KLM is increasing services to Canada and is launching two new routes: Vancouver operated by Air France from March 25, 2015 and Edmonton served by KLM from  May 5, 2015. The Group is also improving its position in South America thanks to the launch of a new KLM route to Bogota and Cali (Colombia) from March 31, 2015.

Medium-haul: Air France-KLM is developing its European network on departure from the Amsterdam-Schiphol hub by adding three new destinations operated by KLM Cityhopper as from May 18, 2015: Belfast (Northern Ireland), Krakow (Poland) and Montpellier (France). At Paris-Charles de Gaulle, Air France is increasing capacity to Bordeaux (France), Naples (Italy), Billund (Denmark), Bucharest (Romania) and Budapest (Hungary).

On departure from Paris-Orly and the regional airports, the Group continues to reorganize its short-haul activity, currently regrouped within HOP! Air France’s operations.

Low-cost operations: Transavia is continuing its rapid development in France (+30%) and is consolidating its activity in the Netherlands. The company is launching 14 new routes, while strengthening its offer of flights to the most popular summer destinations.

New products and services: Air France-KLM is continuing its move upmarket. At the end of the summer season, 20 Air France Boeing 777 (above) will be equipped with the latest BEST cabins. After renovating its World Business Class cabin on all its Boeing 747-400, KLM is gradually equipping its fleet of Boeing 777 with its new World Business Class and Economy Class. From April 2015, Air France is also introducing a new leather seat on 24 Airbus A319 on departure from Paris-Charles de Gaulle. It will then equip 25 Airbus A320 in the first half of 2016.

Partnerships: As well as strengthening its joint ventures (Delta, Alitalia, China Southern, China Eastern, Kenya Airways, Air Mauritius) and its strategic agreements (GOL), Air France-KLM is continuing the development of its partnerships all over the world. To offer more and more flight frequencies and destinations, the Group is extending its cooperation with the Canadian airline WestJet. The Group also has strong ambitions In Asia, illustrated by the signing of a cooperation agreement between KLM and Xiamen Airlines and the code-share agreement with Garuda on flights between Amsterdam and Jakarta.

LONG-HAUL: +1.8%

Air France-KLM’s long-haul activity is increasing by +1.8%.

North America

For the 2015 summer season, Air France-KLM is increasing services to Canada. As of March 25, 2015, Air France is launching a new route to Vancouver, with up to 5 weekly flights from Paris-Charles de Gaulle. KLM is also introducing a new service between Amsterdam-Schiphol and Edmonton on May 5, 2015, with 3 weekly flights, then 4 weekly flights as of  June 22, 2015.

Air France-KLM is developing its partnership with the Canadian airline WestJet, by offering new connecting opportunities in North America in addition to the new Paris-Vancouver and Amsterdam-Edmonton routes. Moreover, the Group is maintaining its close cooperation with Delta Air Lines as part of the trans-Atlantic joint venture.

Between May and September 2015, the seasonal service to Minneapolis-Saint Paul (USA) will be resumed from Paris-Charles de Gaulle. To meet market demand, Air France will be operating a second daily flight to San Francisco (USA) during the peak summer season (from mid-June to the end of August 2015). KLM is also further extending its second flight to Los Angeles to the full summer period, offering 12 weekly frequencies.

Central and South America and the Caribbean

As from March 31, 2015, KLM is launching a new service to Bogota and Cali (Colombia) from Amsterdam-Schiphol with 3 weekly frequencies. As a continuation of the winter season, Air France is increasing capacity to Panama City, with 5 weekly flights. Services to Brasilia (Brazil), launched in summer 2014, are maintained with 3 weekly frequencies.

In addition, Air France-KLM is maintaining its close cooperation with the Brazilian airline GOL, in order to offer numerous connecting opportunities to its customers on the Brazilian domestic network.In the Caribbean, as a continuation of the winter schedule, Air France-KLM is adjusting capacity during the peak summer season. The Company will offer up to 13 weekly flights to Pointe à Pitre and up to 11 weekly flights to Fort de France. Moreover, during the peak summer period, KLM will be operating a second nonstop flight twice a week to Curacao, in addition to the daily flight from Amsterdam-Schiphol.

Asia

Air France is continuing its daily service to Hong Kong (China) by Airbus A380 (5 weekly flights) and by Boeing 777-300 (2 weekly flights). The Company is also increasing capacity to Seoul (South Korea), serving this destination by Boeing 777-300 with 383 seats as well as to Singapore, with three additional flights operated during the peak summer period. Air France is continuing to serve Tokyo-Haneda Airport (Japan) up to 13 times a week in addition to the daily flight to Tokyo-Narita which provides connections to Noumea (New Caledonia).

The Group is also continuing to strengthen its cooperation with its Asian partners to offer an even wider choice of flights and destinations. In particular, KLM and Garuda Indonesia have set up a code-share agreement on both airlines’ flights between Amsterdam and Jakarta (Indonesia). KLM has also signed a cooperation agreement with the Chinese airline Xiamen Airlines, illustrating their commitment to strengthening accessibility between the Netherlands and China.

Africa and the Indian Ocean

As a continuation of the winter season, Air France will serve Abidjan (Ivory Coast) daily, including 3 weekly flights by Airbus A380. The Company is also increasing capacity to Dakar (Senegal), by operating the route from Paris-Charles de Gaulle by Boeing 777-300 with 383 seats.

In East Africa, KLM is continuing to specifically adjust its network to market expectations by increasing capacity to Dar es Salaam (Tanzania) and Entebbe (Uganda). Both destinations are served non-stop three times a week from Amsterdam-Schiphol, providing new connecting opportunities to Europe and North America in particular. On the other days these destinations are offered respectively as a continuation of the services to Kilimanjaro (Tanzania) and Kigali (Rwanda). KLM is also strengthening its cooperation with its partner Kenya Airways by offering new connections to Zambia, Zimbabwe, Zanzibar and the Indian Ocean, as a continuation of the service to Nairobi airport which boasts new airport facilities.

In the Indian Ocean, Air France serves Reunion Island up to 11 times per week, including 5 night flights.

Middle East

Air France’s new BEST cabins have been flying to Dubai (UAE) since February 23, 2015. In September 2015, these cabins will also be available to Beirut (Lebanon). Furthermore, the Group maintains its code-share agreements with Middle East Airlines, Saudia and Etihad.

New long-haul products and services

Air France-KLM is continuing to roll out new products and services aiming to be among the best in the world.

By the end of the 2015 summer season, the new Air France BEST cabins will equip 20 aircraft and fly to 18 long-haul destinations:

North America: Los Angeles, New York, Toronto, Washington;
South America: Sao Paulo;
Africa: Bangui, Douala, Libreville, Malabo, Yaoundé;
Middle East: Beirut, Dubai;
Asia: Beijing, Guangzhou, Jakarta, Shanghai, Singapore, Tokyo-Haneda.

On its BEST fleet (Boeing 777-200 and 777-300), Air France is adapting to customer demand during the peak summer period (from mid-July to the end of August) by adjusting in just ten hours the seating configuration of its aircraft. This ‘quick change’ can replace certain Business class seats with additional Economy seats. These additional seats correspond to the operation of the 3 additional Boeing 777-200 during the entire season.

Above Copyright Photo: Ton Jochems/AirlinersGallery.com. The pictured Boeing 747-406 PH-BFT (msn 28459) now wears the updated 2014 livery.

Furthermore, having renovated its World Business Class cabin on all its Boeing 747-400 (above), KLM is gradually equipping its Boeing 777-200 and then its 777-300 with its new World Business Class and Economy Class. At the end of 2016, 80% of KLM’s fleet will be equipped with fully renovated cabins.

MEDIUM-HAUL: -1.9%

For the 2015 summer season, the Group’s medium-haul capacity is continuing to readjust and is down by -1.9%.

On departure from the hubs at Paris-Charles de Gaulle and Amsterdam-Schiphol

For the 2015 summer season, KLM is expanding its European network on departure from its hub at Amsterdam-Schiphol by adding three new destinations: Belfast (Northern Ireland), Krakow (Poland) and Montpellier (France). These new services will be operated from 18 May 2015 with one daily flight. Furthermore, the number of daily KLM flights to Florence and Basel is increasing from 3 to 4.

On departure from Paris-Charles de Gaulle, Air France is adding a daily flight to Bordeaux (France), Naples (Italy), Billund (Denmark), Bucharest (Romania) and Budapest (Hungary). As of April 2015, the company will be introducing an upgraded product (greater flexibility for business trips, new gourmet attentions) as well as a new leather seat which will be progressively installed on board 24 Airbus A319s. This seat will subsequently equip 25 Airbus A320s during the first half of 2016.

On departure from Paris-Orly and the French regions

As from summer 2015, HOP! Air France is regrouping the entire short-haul network under a single commercial offer. This unified network includes all short-haul routes from Paris-Orly and the French regions. These routes are operated by Air France Airbus or HOP! regional aircraft.

Above Copyright Photo: Paul Bannwarth/AirlinersGallery.com. Hop! For Air France ATR 42-500 F-GPYL (msn 542) taxies at Nantes, France.

HOP! Air France is continuing to restructure its network during summer 2015 –

On departure from Paris-Orly, HOP! Air France is rationalizing its offer to Toulouse, Strasbourg and Mulhouse by decreasing the number of frequencies while increasing the capacity of its aircraft.

On departure from the French regions, as a continuation of the adjustments initiated in the winter, HOP! Air France is suspending its international flights. However, to meet customer demand, certain destinations will still be operated during the summer holiday period, notably routes to Beirut and North Africa on departure from Marseille; Spain, Italy and Greece on departure from Toulouse; Tel Aviv and Athens on departure from Nice.

Transavia: +7.8%

As a continuation of the winter season, Transavia is continuing its rapid development in France (+30%) and is consolidating its operations in the Netherlands (-0.8%).

With the ambition to be the leading low-cost airline in terms of destinations from Paris-Orly in 2015, Transavia France is launching 10 new routes this summer:

– On departure from Paris-Orly: Valencia, Dublin, Munich, Thessaloniki, Tirana, Warsaw, Casablanca, Fez and Amsterdam.

– On departure from Nantes: Madrid.

Furthermore, the company is increasing frequencies on many routes including Barcelona, Madrid, Oporto and Lisbon.

Above Copyright Photo: Paul Bannwarth/AirlinersGallery.com. Now painted in the old 2005 livery, Transavia’s (Netherlands) Boeing 737-7K2 PH-XRE (msn 30668) arrives in Las Palmas.

In the same way, Transavia Netherlands is concentrating its activity on the hub at Amsterdam-Schiphol, where it will offer new frequencies to Tel Aviv, Larnaca, Malta and Paris-Orly. The Company is also increasing its offer of flights to Alicante, Barcelona, Malaga, Pisa, Naples and Thessaloniki.

Transavia Netherlands will also operate a new route from Rotterdam-The Hague to Berlin. On departure from Eindhoven, the service launched to Athens in February 2015 will continue this summer.

To accompany this rapid growth, Transavia has ordered 20 Boeing 737-800, with 17 firm orders and another three options. These aircraft will support the rapid growth of Transavia France and the development of Transavia Netherlands. The delivery of these aircraft will begin in January 2016 and will continue until 2018.

Top Copyright Photo: Christian Volpati/AirlinersGallery.com. Air France’s Boeing 777-328 ER F-GZNE (msn 37432) in the SkyTeam alliance livery taxies to the runway at the Paris (CDG) hub.

Air France aircraft slide show: AG Airline Slide Show

KLM aircraft slide show: AG Airline Slide Show

Transavia (Netherlands) aircraft slide show: AG Airline Slide Show

Transavia (France) aircraft slide show: AG Airline Slide Show

Hop! Air France aircraft slide show: AG Airline Slide Show

AG Up-close action photography

Transavia orders 17 Boeing Next-Generation 737-800s

Boeing (Chicago, Seattle and Charleston) and Transavia Company (Transavia Airlines and Transavia France), a wholly owned subsidiary of the Air France KLM Group, today announced an order for 17 Next-Generation 737-800s, including options for three additional airplanes. The order, valued at $1.6 billion at current list prices, was previously booked and attributed to an unidentified customer on the Boeing Orders & Deliveries website.

The order will significantly support the growth of Transavia’s operations from France and the Netherlands. The airline currently has a combined all-Boeing fleet of 45 Next-Generation 737s.

Air France and KLM are now funneling more routes to its two main subsidiaries.

Transavia Company has six bases, with Amsterdam’s Schiphol Airport and Paris-Orly Airport as its main hubs, serving 110 destinations in Europe and North Africa. Passenger numbers reached 10 million in 2014.

Photo: Ton Jochems/AirlinersGallery.com. Boeing 737-8K2 PH-HSJ (msn 42150) taxies at the Amsterdam base in the now old 2005 livery.

Transavia Airlines (Netherlands) aircraft slide show: AG Airline Slide Show

AG WAN-Powered by AG

Transavia introduces a new bright and whimsical look

Transavia (2015) logo (large)

Transavia Airlines (Netherlands) (Amsterdam) and Transavia France (Paris-Orly) have introduced a new brighter shade of green and white livery, ten years after the last change. The new makeover by Studio Dumbar redesigns the “t” logo and the new style font titles also drop the .com.

Transavia New Year

 

The company is advertising the change as “the new Transavia”.

Read how the new brand was developed by Studio Dumbar: CLICK HERE

Images below: Studio Dunbar.

Transavia (Netherlands) 737-700 WL PH-XRX (15)(Tko)(Studio Dunbar)(LR)

Transavia (Netherlands) 737-800 WL PH-HZN (15)(under)(Transavia)(LR)

All images by Transavia:

Transavia (Netherlands) aircraft slide show:

Video: The unveiling of the new brand:

AG Bottom Ad Bar

Transavia France to introduce six new routes next summer season, Air France’s pilots approve the expansion of Transavia France

Transavia France (Paris-Orly) is introducing six new routes for the summer season of 2015. Five new routes will be from Orly Airport to Dublin (effective June 1, daily), Munich (effective September 4, daily) Thessaloniki (effective May 9, three flights a week), Tirana (effective July 2, three weekly flights) and Valencia (effective June 1, six weekly flights) per Airline Route.

The French airline will also operate a Nantes-Madrid route effective on April 12, 2015 on three days a week.

In other news, 53 percent of Air France’s pilots approved the draft agreement to allow Transavia France to expand operations from Paris Orly. Air France issued this statement on December 3:

Air France welcomes the positive outcome of the consultation with all its pilots on the draft development agreement for Transavia France.

With a very high participation rate, 53% of Air France pilots approved the agreement, reaching 60% for members of the majority union SNPL.

This result will be approved by the Union Council of the SNPL (National Union of Airline Pilots), which will meet tomorrow Thursday, December 4.

To date, more than 200 Air France pilots have volunteered to fill the 72 positions available at Transavia France.

“We welcome the positive outcome of this consultation which puts an end to a period of uncertainty. The majority of pilots have chosen to accompany us in our growth strategy on the low-cost market with Transavia” declared Frédéric Gagey, Chairman and CEO of Air France.

Thanks to this agreement, Transavia’s rapid development plan in France will continue:

• Strong growth in summer 2015: 21 aircraft operated compared with 16 in summer 2014, making Transavia the leading low-cost airline at Paris-Orly from summer 2015.

• A target of 37 Boeing 737 by 2019.

Integrated career management for pilots at Air France and Transavia will be introduced, including a joint seniority list.

This development meets the pilots’ high expectations and enables overstaffing at Air France to be more easily managed by organizing secondments to Transavia France.

to Dublin (effective June 1, daily), Munich (effective September 4, daily) Thessaloniki (effective May 9, three flights a week), Tirana (effective July 2, three weekly flights) and Valencia (effective June 1, six weekly flights).

The French airline will also operate a Nantes-Madrid route effective on April 12, 2015 on three days a week.

Copyright Photo: Steve Bailey/AirlinersGallery.com. The pictured Boeing 737-8K2 F-GZHM (msn 37792) was delivered new on May 13, 2014. The Transavia France Boeing 737 fleet will expand to 37 aircraft by 2019.

Transavia France aircraft slide show:

 

 

 

Air France’s pilots: the strike will continue, Air France: we will speed up the development of Transavia France

Air France (Paris) is still reeling from a week-long strike by its pilots. The flag carrier has only been able to fly a small portion of its flights due to the on-going strike. Today (September 22) the pilot’s union rejected the latest offer by management to end the strike.

Air France announced today it expects to operate 42 percent of its flights tomorrow (September 23) as the strike continue.

Today Air France also announced it will speed up the development of the lower-cost Transavia France (Paris) with this announcement:

The pilots’ strike has been disrupting flight operations for seven days now, with catastrophic consequences for the Company’s customers, staff and financial situation. Alexandre de Juniac and Frédéric Gagey wish once again to thank all staff who have rallied round in France and around the world to support and assist customers in this unprecedented situation. The Company wishes once again to present its sincere apologies to its customers.

This strike generates an operating loss of up to 20 million euros per day, plus customer compensations and the impact of the gradual recovery in traffic in the days following the return to normal operations. Once the dispute is over, the Group will update its EBITDA target for the 2014 financial year.

Negotiations with the pilot unions, notably the SNPL, have taken place daily. Since the beginning of the strike action, Alexandre de Juniac and Frédéric Gagey have spent over 40 hours in meetings with pilot representatives. Every day, they have been submitting new constructive proposals to resolve this conflict. On their part, the pilot unions have not put forward any proposal demonstrating their willingness to find a solution.

Management can only note that talks have reached a deadlock situation.

Management also wishes to reassert that Air France-KLM’s development on the low-cost market in Europe is both strategic and urgent for the Group’s future, given that this market is fast-expanding and our competitors have adopted particularly offensive strategies on the French market.

The ambition set out in the Perform 2020 growth and competitiveness plan remains intact. The pilot unions have stigmatized the Transavia project by fuelling unfounded fears of “delocalization” and “social dumping”, which have never been at stake. Management regrets these mistaken interpretations, but has taken note of the concerns expressed.

Alexandre de Juniac, Frédéric Gagey and the managerial teams have since taken the following measures:

Postponing the plan to create Transavia subsidiaries in Europe (outside France and the Netherlands), while entering into extended talks about the project and building together the necessary guarantees by the end of the year.

A comprehensive negotiation and explanatory process with Air France and KLM unions will be set up. As for Air France, this process will begin as soon as the next Central Works Council meeting takes place, scheduled for September 25, 2014.
FASTER IMPLEMENTATION OF THE TRANSAVIA PROJECT IN FRANCE

The expansion of Transavia in France is vital for Air France, notably in order to defend the Group’s position at Orly Airport, as highlighted by the experts’ report published in July 2014 and supported by the SNPL. It is now urgent to implement this plan.

The project was presented to the unions of each staff category over a year ago, but was not finalized within the framework of the talks underway. The pilot unions’ demand to use, on the Transavia network, Air France pilots employed under Air France conditions and to replace the existing 44 Boeing 737s by Airbus A320s, would inevitably lead Transavia France to failure. The compromise solutions proposed by management have all been rejected.

In these conditions, if the pilot organizations do not agree to the economic and social terms and conditions of the project put forward, Management will be forced to begin the formal procedure for denouncing the agreement to create Transavia France (signed in 2007). This agreement currently restricts the development of Transavia France; its withdrawal will make it possible to implement the project more quickly.

The aim is to rapidly equip Transavia in France with additional aircraft beyond the 14 currently in the fleet. It should be remembered that this project included the creation of a thousand jobs over the next 5 years, including 250 jobs for French pilots. It will now be possible to hire staff faster. The project will, as expected, be primarily open to Air France pilots on a voluntary basis.

Moreover, Management confirms that the development of Transavia in France is not intended to impact Point to Point activity on the French domestic network. Transavia will not feed the Air France hub at Paris-Charles de Gaulle.

“To remain in the race in Europe, we have no alternative than to rapidly expand Transavia. We are now taking every measure to explain and accelerate its growth out of France. The Air France-KLM Group is reaffirming its aim of reaching a fleet of more than 100 Transavia aircraft by 2017,” said Alexandre de Juniac. Frédéric Gagey continued: “These decisions must enable us to restore calm within the company and end the strike that has lasted too long for Air France, its customers and its staff.”

Top Copyright Photo: Paul Bannwarth/AirlinersGallery.com. Operations at Paris’ Charles de Gaulle Airport (CDG) will remain under the Air France brand but flights to Orly Airport will increasing be under the Transavia brand. With the expedited expansion of Transavia France the subsidiary is likely to get a new look. Airbus A319-111 F-GRHV (msn 1505) taxies at Nantes.

Air France: AG Slide Show

Transavia France: AG Slide Show

Current routes from Paris (Orly) by Transavia France:

Transavia France 9.2014 Route Map

Bottom Copyright Photo: Joe G. Walker/AirlinersGallery.com. Boeing 737-8K2 F-GZHC (msn 29651) wears the 2005 livery of the Dutch version of the original Transavia Airlines.

 

Air France-KLM to retire the Martinair McDonnell Douglas MD-11 freighters in 2015 and 2016, will expand Transavia leisure flights

Air France (Paris) and KLM Royal Dutch Airlines (Amsterdam) (Air France-KLM Group) issued this statement about its shrinking and unprofitable freighter fleet including Martinair‘s (Amsterdam) McDonnell Douglas MD-11 freighter fleet:

At its meeting on September 4, 2014, the Air France-KLM Board of Directors examined the findings of the strategic review of its full-freighter operations which was launched earlier this year.

On top of the ongoing reduction of the full-freighter fleet, and facing a slower than expected recovery in demand, the Board of Directors has decided to reduce the full-freighter fleet based in Amsterdam to 3 aircraft in operation by the end of 2016. Five MD-11s will be phased out on an accelerated basis during 2015 and 2016.

By then, the Group will operate five full-freighter aircraft: 2 Boeing 777Fs in Paris and 3 Boeing 747 ERFs in Amsterdam, compared with a total of 14 in 2013.

The group intends to find alternative employment internally for all affected staff. It will engage in consultations on this matter with the Works Council and trade unions of the companies involved.

The Group will remain a major player in the cargo sector in Europe through its extensive belly network effectively supplemented by a limited number of full-freighter aircraft.

This adjustment of the full-freighter fleet is part of a broader strategic vision designed to increase cargo contribution to the group. Other measures include a strong focus on specialized products such as pharmaceuticals and express, as well as investment in state-of-the-art IT infrastructure and E-developments, further cost reduction and expansion of partnerships.

In other news, the Air France-KLM Group will expand its leisure operations under the Transavia brand with new bases outside of Paris and Amsterdam. The Group issued this statement:

At its meeting on September 4, 2014, as proposed by its Chairman and CEO Alexandre de Juniac, the Air France-KLM Board of Directors approved the group’s development project on the leisure market in Europe.

This development will take place under the Transavia brand from the two existing airlines – Transavia France and Transavia the Netherlands – and new bases will be opened in other European countries.

This project will strengthen the development of Transavia France (Paris) and Transavia Airlines (Amsterdam) in the Netherlands. The terms of these developments are the subject of consultations in both countries.

The group is positioning itself as a major player in this rapidly growing market in Europe.

This project is part of the group’s new plan for growth and competitiveness, Perform 2020, which will be presented in details to investors and to the press on September 11.

Air France-KLM have also unveiled its new “Perform 2020” program which replaces its “Transform 2015” program. Here is the formal plan:

Air France-KLM unveiled its new Perform 2020 strategic plan.

Perform 2020 is the successor to Transform 2015, which represented the first phase in the Group’s turnaround. While maintaining the imperatives of competitiveness and the ongoing strengthening of the Group’s financial position, this growth plan will focus on the following three strategic areas:

  •   Selective development to increase exposure to growth markets
  •   A product and services upgrade targeting the highest international level
  •   An ongoing improvement in competitiveness and efficiency within the framework of strictfinancial disciplineAir France-KLM’s Chairman and Chief Executive Officer, Alexandre de Juniac, made the following comments:
    “Transform 2015 will be completed by the year end having fully delivered on its objective of significantly improving the Group’s competitiveness and delivering a €1 billion-plus reduction in costs. Perform 2020, the strategic plan we are launching today, will be supported by two main levers: growth, which we are looking to capture in a number of areas, and competitiveness combined with financial discipline which should continue to ensure firm foundations for the development of Air France-KLM. This is why the ambitious initiatives we are launching today will go hand in hand with redoubled efforts to reduce costs and restructure activities which remain loss-making. By 2020, we will have built an air transport Group focused on a leading long-haul network at the heart of global alliances, with a portfolio of unique brands, restructured short and medium-haul operations with a reinforced presence in the low cost segment in Europe, leadership positions in cargo, maintenance and catering, and a significantly improved risk profile both operationally and financially.”

    1 See definition in appendix
    2 At constant currency, fuel price and pension cost

Business review

In an environment which remains challenging but with profitable growth opportunities across all the Group’s markets, Air France-KLM plans to reinforce its key strengths, namely its network, its products and services, and its brands, while adjusting its portfolio of activities.

The development of the passenger hub business based on an upgraded product offer, an increased customer focus and a stronger positioning of brands. Benefiting from the broadest long-haul network on departure from Europe, the Group will be able to continue to capture growth opportunites particularly via the reinforcement of strategic partnerships.

The Group will maintain strict capacity discipline with growth in passenger capacity expected to be around 1% to 1.5% for the 2015-2017 period.

The Group will continue to restructure its point-to-point operations, aiming at a return to operating breakeven by 2017. In addition to the full impact of the measures launched in 2013, this objective will be reached thanks to new initiatives to restructure the network and reduce costs, together with the creation of a single business unit combining HOP and the Air France point-to-point operations.

The accelerated development of Air France-KLM in the European leisure market, under the Transavia brand, based on the two existing companies – Transavia France and Transavia Netherlands – and new bases to be created in other European countries. In a growth market, the Group plans to build on the results achieved within the framework of Transform 2015 to move to a more pan-European scale. By 2017, Transavia will rank amongst the leading low cost carriers in Europe, operating a fleet of 100 aircraft and carrying more than 20 million passengers. This business should contribute an additional €100 million of EBITDAR in 2017. With profitability being impacted by ongoing ramp-up costs, the Group is targeting operating profits by 2018.

The finalization of cargo repositioning: a significant reduction in the full-freighter fleet, from 14 aircraft in operation in 2013 to 5 aircraft at the end of 2016, should enable this business to return to operating breakeven in 2017 (versus a loss of €110 million in 2013 and a €200 million loss including bellies). The group will maintain a small full-freighter fleet as an important commercial lever to support its revenue premium on bellies. The Group will remain a major player in the European cargo sector thanks to its extensive belly network, but with only very limited remaining exposure (15% of capacity) to full-freighter volatility.

The recent development of the maintenance business has proven successful, with increased profitability and rapid growth in the order book. The Group will pursue its growth in this segment, particularly in engines and components, including via targeted acquisitions. This business should generate an additional €50 million to €80 million of EBITDAR in 2017, depending on acquisitions.

From a selective capex management while adopting a disciplined approach to growth opportunities. financial perspective, Air France-KLM plans to pursue the reduction in its unit costs and The Group will leverage the structured approach implemented within the framework of Transform 2015 to maintain unit cost reduction at an annual rate of 1% to 1.5%. To achieve this target, the group will go beyond traditional efforts directed at reducing unit costs (e.g. reduction in external expenses, purchasing policy and renewal of the long-haul fleet). This will involve the ongoing restructuring of uncompetitive activities and implementing a systematic review of processes using benchmarking based on profit centers. It will also entail negotiating with staff on the achievement of productivity gains paving the way to growth.

A progressive increase in fleet capex will be undertaken within the framework of strict capex control. Investment will remain below its pre-2012 level. Dedicated sources of funding will be allocated to significant development opportunities to ensure control over credit ratios. For example, the first phase in Transavia expansion will be financed by the €339 million proceeds generated from the partial disposal of Amadeus shares on September 9.

Medium-term financial targets to 2017

As a result of all these initiatives, Air France-KLM has set itself the following Group financial targets:

  •   EBITDAR up by 8% to 10%5 per year between 2013 and 2017
  •   An adjusted net debt/EBITDAR4 ratio of below 2.5 in 2017
  •   Base businesses to consistently generate annual positive free cash flowThese targets are consistent with a ROCE of 9% to 11% in 2017.

Read the analysis by Bloomberg Businessweek: CLICK HERE

Top Copyright Photo: Keith Burton/AirlinersGallery.com. Martinair’s McDonnell Douglas MD-11 (F) PH-MCS (msn 48618) prepares to land at London’s Stansted Airport.

Air France: AG Slide Show

KLM: AG Slide Show

Martinair: AG Slide Show

Transavia Airlines (Netherlands): AG Slide Show

Transavia Airlines (France): AG Slide Show

Bottom Copyright Photo: Ton Jochems/AirlinersGallery.com. Transavia Airlines’ (Netherlands) Boeing 737-8K2 PH-HZA (msn 28373) with a Kulula underside taxies at the Amsterdam base.