Air France is aiming at presenting a plan to trade unions to cut just more than 6,500 jobs in the next two years, three sources familiar with the matter mentioned as quoted by Reuters, with the airline struggling due to the coronavirus or COVID-19 crisis.
The flagship airline of France, which is part of the Air France-KLM group, is going to cut the capacity and exit the loss-making domestic routes as the deadly novel pandemic hits international travel.
On top of the 6.500 staff cuts - roughly representing just under 15 percent of employees such as pilots, ground staff and flight attendants - an additional 1,000 layoffs would be made at Air France's "HOP!" airline, one of the three sources said. BFM TV and Agence France Presse earlier reported 7,500 looming job losses. Air France declined to comment on its labor plans. It is expected to hold talks with unions on Friday.
Air France to Cut Jobs
Some 3,500 of the job cuts would come from natural attrition - such as retirements and not replacing leavers, two of the sources said. Under CEO Ben Smith, who joined from Air Canada in 2018, Air France-KLM has sought to cut costs, improve French labor relations and overcome governance squabbles between France and the Netherlands, which each own close to 14% of the group.
Now saddled with 10.4 billion euros in government bailout debt to cope with the pandemic - including last week's 3.4 billion Dutch contribution - Air France-KLM must now step up restructuring to stay competitive and independent. Rivals have moved faster to announce job cuts, with British Airways planning to axe 12,000 positions and easyJet 4,500, amounting to 30 percent of their respective workforces.
Lufthansa Group is also cutting the equivalent of 22,000 full-time positions, or 16 percent. But a mature staff including many close to retirement should help Air France meet voluntary redundancy targets, Smith told Reuters as restructuring talks opened in May. Ground-based staff are expected to bear the brunt of job cuts, the sources said.
(With agency inputs)