MIAMI – An agreement has been reached with the EU Commission to inject fresh cash into a financially plagued Air France (AF).
The news was announced by Bruno Lemaire, French Finance Minister, during an interview given at the French TV channel LCI on Sunday, April 4.
The news, also confirmed by the Les Echos newspaper on April 5, will bring much-needed money to AF, which, like many other carriers, suffers from the crisis brought along by the COVID-19 pandemic. At least in France, the pandemic does not seems to be remitting and has caused a new national lock-down effective today April 5 and lasting at least until the end of this month.
This announcement, made by the French President on a TV national broadcast last Friday, sounds like a cold shower on AF’s tentatives plans to return to normal travel levels very soon.
The Good News
The good news for AF is the less stringent conditions imposed by the EU Commission in terms of slots handover at Paris-Orly Airport (ORY). The EU had requested AF to relinquish 24 slots at ORY, equal to 8,700 rotations per year, which is 7% of its total 125,000 slots.
No new numbers are at the moment available as AF shall communicate on this matter tomorrow Tuesday, April 6. However, according to various sources like Boursorama, a French financial newspaper, the slots hand over, initially concentrated on ORY, would now be split between this airport and Paris-Charles de Gaulle Airport (CDG).
Air France Asked to Make Efforts on Competitiveness
The French Finance Minister, while welcoming this new agreement as “fair and proportionate,” also warned that AF “must make efforts on competitiveness.” He pointed out that the carrier has already received US$8.2bn (€7bn), “a strategic aid, taking into account the several thousands of jobs concerned.”
He also stressed that AF “must return to profits” and asked AF’s CEO, Benjamin Smith, “to make proposals and show that the money the French people used to support AF is a good and sound investment.”
KLM to Deal with the Same Issue
A similar request on slots hand-over at Amsterdam-Schipol Airport (AMS) has also been made to AF’s associate, KLM. At the moment, though, no news has been announced by the Dutch Government on this subject. An AF Board meeting has been called for the evening of April 5 in order to validate the agreement reached with the EU Commission.
On state aid, a reaction at the European level is most probably to be expected from Ryanair (FR), which is waging legal battles against all carriers recipients of such aid. FR has a particularly harsh feud with AF on the matter.
Featured image: Air France Boeing 777-200ER F-GSPO – Photo : Tony Bordelais/Airways