Bruce Barnard, Special Correspondent | Jun 21, 2012 11:07AM EDT
Air France-KLM outlined plans to lay off more than 5,000 of its French work force by the end of 2013 in bid to cut costs by $2.5 billion a year and return business to profitability.
Europe’s largest airline didn’t reveal how many of the job cuts will come from its French cargo unit, which has already said it will cut its freighter capacity by 20 percent and stop chasing global market share.
Air France promised it would try to avoid compulsory layoffs by pursuing early retirement and attrition, voluntary redundancies, part-time working and work sharing.
But the carrier warned enforced layoffs are “unavoidable” if labor unions reject the Franco-Dutch company’s business plan.
“Air France is facing a fundamental choice about its future,” Alexandre de Juniac, CEO of the French part of the company, said in a statement issued after a meeting with union officials.
“Our business plan has two ambitions: to ensure Air France returns to profitability, and to better serve our customers. If we make all the necessary equitably distributed efforts, there will be no forced departures,” he said.
Air France Cargo’s “Transform Plan” calls for the disposal of one Boeing 747-400 extended range freighter, reducing its fleet to two 747-400s and two Boeing 777 freighters – down from a 12 cargo aircraft in 2009.
Air France Cargo also is integrating operations with KLM Cargo and its Martinair subsidiary, which has taken over many of the freighters from the two companies and currently has six 747-400s and seven MD-11Fs. The three carriers have been operating a single network since June 1.
Air France Cargo is currently reducing its exposure to the weakening Chinese market – it stopped freighter service to Shanghai- and is refocusing on West Africa, the Indian Ocean, North America, Mexico and Japan.