Air France to seek conciliatory approach to revamp | Fin24
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Air France to seek conciliatory approach to revamp

Sep 05 2016 18:41
Andrea Rothman

Toulouse - Air France-KLM Group will jettison a hardline stance on cost cutting that antagonised employees and unions under its former chief executive officer in favour of a more conciliatory approach to be called "Trust Together," according to a person familiar with the plan.

Jean-Marc Janaillac, who succeeded Alexandre de Juniac as CEO in July, will unveil the program in November in an effort to secure vital savings while restoring harmony to labour relations, said the person, who asked not to be identified because the details are still private.

De Juniac had sought to push through measures to boost productivity in the face of union opposition, leading to strikes by pilots and cabin crew, courtroom clashes and a violent confrontation that led managers to flee a meeting with their clothes in tatters and made negative headlines around the world.

Janaillac will also seek to smooth Air France’s relationship with Dutch sister company KLM, where employees have been critical of the succession of walkouts by French workers, according to the person.

Presidential election

A more conciliatory approach at Air France-KLM may be appreciated by French President Francois Hollande, a friend and former schoolmate of Janaillac, who faces national elections next year, should he choose to stand again. The state holds a near 18% stake in the group.

Shares of Air France-KLM traded 0.5% higher at €5.07 as of 12:15 in Paris, where the company is based. The stock has declined 28% this year following a 12% drop in 2015, reducing the group’s market value to €1.5bn - less than one-third that of Deutsche Lufthansa AG and one-sixth that of British Airways owner IAG.

The revised labour strategy, which was reported by French newspaper La Tribune on September 2, is due to be presented to the Air France-KLM board on November 2, the person said.

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