Air France announces loss of over $300Mln due to ongoing strikes


The government over the weekend said the French state, the largest shareholder with a 14 per cent stake, would not ride to the airline's rescue.

"If Air France does not make the necessary competitiveness efforts that will allow this national flagship to be at the same level as Lufthansa or other major global airlines, Air France will disappear", said Bruno Le Maire, France's finance minister, in an interview with BFMTV on Sunday.

Regardless of the strike, the carrier demanded that it is ready to keep up 99% of whole deal flights on Monday, 80% of medium-pull administrations and 87% of short-pull flights.

Unions demand a 3.8% wage increaseThe airline presented losses in the results of the first quarter of 2018The resignation of the main manager of the company along with the labor tensions of the airline led to the shares of Air France - KLM to fall to 7 euros per share.

The firm's CEO Jean-Marc Janaillac announced his resignation on Friday after staff at the carrier's French operations rejected a pay deal aimed at ending months of walkouts.

Back in 2015, protesters ripped the shirts off Air France executives after the company revealed plans to cut thousands of jobs.

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The announcement of Janaillac's departure came as Air France-KLM released its first-quarter earnings, which showed a net loss of 269 million euros ($322 million), weighed down by three days of strikes which cost about 25 million euros per day according to the company.

Societe Generale analysts said the company's employees "have not only forced the group CEO to resign, but also made the investment case obsolete".

British Airways and Lufthansa have already undergone heavy cost-cutting in recent years, amid rising competition from low-priced airlines and carriers from the Gulf states.

"I do not understand the current situation given Air France was on the right track", the French minister insisted. The company declined to comment further on what format that would take or how long the transition would last.

"KLM might (rightfully) ask why the profits are being generated in the Netherlands but the losses being made in France", they said. "There are still no meetings planned for further negotiations", Philippe Evain, leader of the SNPL pilots union told RTL radio.

The government's response is seen as a test of labour reforms launched by French President Emmanuel Macron.