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New Air France boss proposes first job cuts
[PARIS] The new chief executive of Air France has proposed the first job cuts for the strike-prone airline since taking over eight months ago, with up to 465 voluntary redundancies announced on Monday.
The cuts have been earmarked for its short-haul business in France, which lost 189 million euros (S$291 million) in 2018 and is expected to make further losses in the years ahead, the company said in a statement.
It intends to close or reduce the number of flights on loss-making routes and make use of smaller aircraft to reduce costs, as it confronts fierce competition from low-cost rivals and France's high-speed train network.
The cuts will accompany a reduction in capacity of 15 per cent by 2021, the company said, with ground staff and customer services personnel set to be offered the voluntary redundancy packages.
"This plan will shortly be the subject of a consultation with relevant stakeholders. There will be no forced departures," the airline said.
Canadian Ben Smith was named as the first non-French chief executive of Air France-KLM last year despite strong resistance from the group's powerful trade unions.
The Franco-Dutch group, formed out of a merger of Air France and KLM, has also been caught in a power struggle between Paris and the Hague.
In February, the Netherlands purchased 14 per cent of the airline, nearly matching the 14.3 per cent held by France, sparking tensions over control and French warnings of instability in its management.
The move by the Netherlands was prompted by doubts over the alliance's strategy and worries that Dutch interests were being neglected.
Air France said Monday that its domestic operations had lost 717 million euros in total since 2013.