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Delta/AF-KLM Global JV News  
User currently offlineAlitalia744 From United States of America, joined Mar 2000, 4764 posts, RR: 44
Posted (5 years 7 months 1 week 6 days ago) and read 9082 times:

http://news.delta.com/index.php?s=43&item=725

http://finance.yahoo.com/news/Air-Fr...ta-tieup-to-apf-15300966.html?.v=4

Net:

-Integrated TATL efforts generating $12B in annual rev
-Shared costs and revenues
-Combined corp branding and global advertising where/when needed
-Represents 25% of total TATL capacity
-Covers all TATL flights, AMS-BOM and LAX-Tahiti
-200 TATL flights daily, 50,000 seats.
-Long-term venture.

[Edited 2009-05-20 06:10:26]


Some see lines, others see between the lines.
87 replies: All unread, showing first 25:
 
User currently offlineKL911 From Czech Republic, joined Jul 2003, 5309 posts, RR: 16
Reply 1, posted (5 years 7 months 1 week 6 days ago) and read 9056 times:

Great!

Just read it on internet. Skyteam gets bigger and better everyday!

KL911


User currently offlineRunway23 From US Minor Outlying Islands, joined Jan 2005, 2224 posts, RR: 35
Reply 2, posted (5 years 7 months 1 week 5 days 22 hours ago) and read 8726 times:



Quoting KL911 (Reply 1):
Just read it on internet. Skyteam gets bigger and better everyday!

Skyteam in size is actually getting smaller with the losses soon of Continental and Copa.

The DL-AF-KL JV is seperate from skyteam and just the logical continuation of where NW and KL left off.

I'm sure it won't be long until we see AZ in this joint-venture.


User currently offlineMMEPHX From , joined Dec 1969, posts, RR:
Reply 3, posted (5 years 7 months 1 week 5 days 22 hours ago) and read 8704 times:

Assuming this just integrates the previous AF/DL and NW/KL agreements that were on a similar cost/revenue sharing basis for TATL? Should be a good move overall for the companies as they are sharing the risks/opportunities/efficiencies of the combined operation. Effectively this is now one company providing TATL service. I wonder if the next step would be a consistent product across all travel classes or whether (and I hope) the individual members keep their own particular service styles?

I notice the 25% of TATL capacity which Skyteam will control which is fine as it suggests sufficient competition is still available but these large alliances will probably need to keep a watch on their overall share and business practices in case the regulators get interested in the future. Assuming AA/BA/IB gets approved then I'm thinking the 3 major alliances are going to cover at least 85% of the TATL flights from Europe?


User currently offlineMasseyBrown From United States of America, joined Dec 2002, 5604 posts, RR: 7
Reply 4, posted (5 years 7 months 1 week 5 days 22 hours ago) and read 8678 times:

On this executive committee, AF gets two votes and DL gets one.

Au revoir, Delta.



I love long German words like 'Freundschaftsbezeigungen'.
User currently offlineJetlanta From United States of America, joined Jul 2001, 3365 posts, RR: 35
Reply 5, posted (5 years 7 months 1 week 5 days 21 hours ago) and read 8605 times:



Quoting MasseyBrown (Reply 4):
On this executive committee, AF gets two votes and DL gets one.

Au revoir, Delta.

I doubt the votes carry equal weight. AF+KL likely gets one vote and DL gets one. It takes two yes votes to get something approved. I can't imagine DL agreeing to anything less.


User currently offlineMasseyBrown From United States of America, joined Dec 2002, 5604 posts, RR: 7
Reply 6, posted (5 years 7 months 1 week 5 days 21 hours ago) and read 8517 times:



Quoting Jetlanta (Reply 5):
I doubt the votes carry equal weight.

We'll see. I've long believed that the whole of Skyteam will ultimately be run out of Paris. French companies take a long view and they play to win - with the backing of their government.



I love long German words like 'Freundschaftsbezeigungen'.
User currently offlineJetlanta From United States of America, joined Jul 2001, 3365 posts, RR: 35
Reply 7, posted (5 years 7 months 1 week 5 days 20 hours ago) and read 8458 times:



Quoting MasseyBrown (Reply 6):
We'll see. I've long believed that the whole of Skyteam will ultimately be run out of Paris. French companies take a long view and they play to win - with the backing of their government.

WTF? Please explain because that just sounds delusional.


User currently offlineMasseyBrown From United States of America, joined Dec 2002, 5604 posts, RR: 7
Reply 8, posted (5 years 7 months 1 week 5 days 20 hours ago) and read 8360 times:



Quoting Jetlanta (Reply 7):
WTF? Please explain because that just sounds delusional.

I believe that US airline ownership laws will eventually change and that AF's long-term goal is to acquire working control of DL as well as the rest of Skyteam. I also believe AF is likely to succeed in doing this.

Having the CEO's of DL, AF, and the puppet KLM on the executive committee as apparent equals is a huge concession by DL. There is still a vestigial CEO of NW; why isn't DL's puppet on the committee?

I may ultimately be wrong; but I don't think that makes me delusional, just suspicious.



I love long German words like 'Freundschaftsbezeigungen'.
User currently offlineMayor From United States of America, joined Mar 2008, 10675 posts, RR: 14
Reply 9, posted (5 years 7 months 1 week 5 days 20 hours ago) and read 8341 times:



Quoting MasseyBrown (Reply 8):
I may ultimately be wrong; but I don't think that makes me delusional, just suspicious.

Or paranoid.



"A committee is a group of the unprepared, appointed by the unwilling, to do the unnecessary"----Fred Allen
User currently offlineMasseyBrown From United States of America, joined Dec 2002, 5604 posts, RR: 7
Reply 10, posted (5 years 7 months 1 week 5 days 20 hours ago) and read 8322 times:



Quoting Mayor (Reply 9):
Or paranoid.

That, too.  Smile



I love long German words like 'Freundschaftsbezeigungen'.
User currently offlineJetlanta From United States of America, joined Jul 2001, 3365 posts, RR: 35
Reply 11, posted (5 years 7 months 1 week 5 days 20 hours ago) and read 8324 times:



Quoting MasseyBrown (Reply 8):

Having the CEO's of DL, AF, and the puppet KLM on the executive committee as apparent equals is a huge concession by DL. There is still a vestigial CEO of NW; why isn't DL's puppet on the committee?

Again, just because the KL CEO is on the committee does NOT mean AF & KL each get a vote equal to Delta's. In fact, I can't even imagine that being the case.


User currently offlineMayor From United States of America, joined Mar 2008, 10675 posts, RR: 14
Reply 12, posted (5 years 7 months 1 week 5 days 19 hours ago) and read 8291 times:



Quoting MasseyBrown (Reply 8):
There is still a vestigial CEO of NW; why isn't DL's puppet on the committee?

Not for long. Soon there will be no more NW.


How was the voting done on the NW/KL joint venture? I see this as nothing more than combining the two JVs into one. I can't imagine DL agreeing to anything that would be to their detriment.



"A committee is a group of the unprepared, appointed by the unwilling, to do the unnecessary"----Fred Allen
User currently offlineJRadier From Netherlands, joined Sep 2004, 4725 posts, RR: 50
Reply 13, posted (5 years 7 months 1 week 5 days 19 hours ago) and read 8197 times:



Quoting MasseyBrown (Reply 6):
French companies take a long view and they play to win - with the backing of their government.

And obviously it won't take you a very long time to dig up evidence of this, especially about AF..... Bring it on!



For once you have tasted flight you will walk the earth with your eyes turned skywards, for there you have been and ther
User currently offlineMasseyBrown From United States of America, joined Dec 2002, 5604 posts, RR: 7
Reply 14, posted (5 years 7 months 1 week 5 days 18 hours ago) and read 8125 times:



Quoting JRadier (Reply 13):
And obviously it won't take you a very long time to dig up evidence of this,

I recommend "Economic Management and French Business" by Mairi Maclean published by Palgrave MacMillan UK.



I love long German words like 'Freundschaftsbezeigungen'.
User currently offlinePanamair From United States of America, joined Oct 2001, 4977 posts, RR: 25
Reply 15, posted (5 years 7 months 1 week 5 days 17 hours ago) and read 8033 times:
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Quoting Mayor (Reply 12):
I can't imagine DL agreeing to anything that would be to their detriment.

Agreed...just as a small example, as part of this JV, all beer and wine in Economy is now supposed to be complimentary on Delta transatlantic flights (starting June 1 I believe) although all other adult beverages (cocktails, minis, etc.) will still cost US$7. Now you know that if AFKL were really calling the shots, they probably would have made Delta agree to complimentary alcoholic beverages across the board!


User currently offlineSyncmaster From United States of America, joined Jul 2002, 2039 posts, RR: 10
Reply 16, posted (5 years 7 months 1 week 5 days 17 hours ago) and read 7985 times:
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Quoting Panamair (Reply 15):
Now you know that if AFKL were really calling the shots, they probably would have made Delta agree to complimentary alcoholic beverages across the board!

At the end of the day, it was probably more along the lines of creating the same standards in service across the board. Whichever provides more service will probably be kept. Much like combining WorldPerks and SkyMiles. And the domestic onboard product. Etc, etc.

-Charlie


User currently offlineWorldTraveler From , joined Dec 1969, posts, RR:
Reply 17, posted (5 years 7 months 1 week 5 days 17 hours ago) and read 7973 times:

The greatest compliment possible was paid to AF/DL/KL/NW yesterday by a United spokesperson in response to objections from UA's pilots union to the expanded Star JV:

United spokeswoman Jean Medina said the carrier was puzzled as to why the pilots did not make their objection known sooner.

"As the DOT recognized more than 20 years ago, alliances have created some 15,000 U.S. airline jobs and enable service to communities that otherwise would not be served," Medina said.

She added that United wants its pilots to "fly for an airline that can compete on a level playing field with the world's largest two carriers that already enjoy antitrust immunity today," referring to Delta Air Lines (DAL.N) and Air France-KLM (AIRF.PA), which are part of the SkyTeam alliance. (Reporting by Karen Jacobs and Karey Wutowski; Editing by Leslie Gevirtz, Gary Hill)


Given that UA is looking up to the Skyteam alliance and JV and oneworld doesn't have a TATL JV yet, it sure seems to me that leadership in international cooperation belongs to Skyteam.

http://www.reuters.com/article/marke...sNews/idINN1946281720090520?rpc=44

Notice also from the DL press release that the Skyteam JV includes routes between the US and Africa (which no other US carrier serves) and between Europe and several Latin American countries. No other alliance has expanded to include that kind of scope of coverage in a JV and with each subsequent modification of the JV, more and more of the globe is added.

I don't think you need to worry too much about an AF takeover of DL, though. The JV cannot be cancelled for 10 years and requires a 3 year cancellation notice. The JV itself prevents a takeover from occuring by either carrier. It is far more likely that DL and AF will focus their efforts on acquiring additional carriers and bringing them into the JV rather than trying to gobble each other up. What is the benefit of acquiring your largest partner when the real point is to expand the scope of your alliance, something that is only possible as each side grows and as more carriers are brought into the alliance?


User currently offlineDeltaL1011man From United States of America, joined Sep 2005, 9700 posts, RR: 15
Reply 18, posted (5 years 7 months 1 week 5 days 17 hours ago) and read 7920 times:



Quoting WorldTraveler (Reply 17):
I don't think you need to worry too much about an AF takeover of DL, though. The JV cannot be cancelled for 10 years and requires a 3 year cancellation notice. The JV itself prevents a takeover from occuring by either carrier. It is far more likely that DL and AF will focus their efforts on acquiring additional carriers and bringing them into the JV rather than trying to gobble each other up. What is the benefit of acquiring your largest partner when the real point is to expand the scope of your alliance, something that is only possible as each side grows and as more carriers are brought into the alliance?

I agree here 100%. IMO DL/AF need to look into finding more LHR slots.



yep.
User currently offlineSeemyseems From United Kingdom, joined Jan 2009, 971 posts, RR: 7
Reply 19, posted (5 years 7 months 1 week 5 days 16 hours ago) and read 7904 times:



Quoting DeltaL1011man (Reply 18):
I agree here 100%. IMO DL/AF need to look into finding more LHR slots.

Could DL open a sort of hub at LHR? or LGW or maybe MAN? Perhaps KL could offer some TATL services from the UK?



seemyseems
User currently offlineMasseyBrown From United States of America, joined Dec 2002, 5604 posts, RR: 7
Reply 20, posted (5 years 7 months 1 week 5 days 16 hours ago) and read 7829 times:



Quoting WorldTraveler (Reply 17):
The JV itself prevents a takeover from occuring by either carrier.

Interesting; and, since the terms of the JV aren't public, I'll take your word for it.

BTW, I didn't say AF would take over DL; I said working control - a very different thing and not necessarily bad for anyone involved. Step one would have been the equity investment AF was prepared to make in DL in bankruptcy; it would be fun to know why that didn't happen.



I love long German words like 'Freundschaftsbezeigungen'.
User currently offlineKeesje From , joined Dec 1969, posts, RR:
Reply 21, posted (5 years 7 months 1 week 5 days 15 hours ago) and read 7577 times:

A clear extension of the KLM - Northwest Alliance that succesfully operates from the early nineties. Key is:

Quoting Alitalia744 (Thread starter):
-Shared costs and revenues

JV partners share all costs and responsibility for getting the right aircraft leave on time full of the right passengers. If KLM sold less in Europe and a delayed DC10 was half full to Boston they both pay the costs. If it was structural a smaller KLM 767 could replace it.

All costs and revenues shared. A big step beyond code sharing. The basis of real commitment and cooperation. In the future demand will determine aircraft type. Anything inbetween on A380 and a 757 on the Atlantic. The hubs don't compete. The thousands of connection flights fall within the deal.


User currently offlineKlkla From United States of America, joined Jul 2004, 948 posts, RR: 0
Reply 22, posted (5 years 7 months 1 week 5 days 15 hours ago) and read 7501 times:



Quoting MasseyBrown (Reply 4):
On this executive committee, AF gets two votes and DL gets one.

Au revoir, Delta.

This is a quote from the release:

"Governance of the joint venture will be equally shared between the Air France KLM Group and Delta. An executive committee comprising the three CEOs and a management committee comprising representatives from Marketing, Network, Sales, Alliances, Finance and Operations will define strategy. Ten working groups will be responsible for implementing and managing the agreement in the sectors of network, revenue management, sales, product, frequent flyer, advertising/brand, cargo, operations, IT and finance. The joint venture will not lead to the creation of a subsidiary. The venture is a long-term, evergreen arrangement that can only be cancelled with a three year notice, after an initial term of 10 years."

It doesn't sound like Delta plans to go away anytime soon.


User currently offlineBobnwa From United States of America, joined Dec 2000, 6538 posts, RR: 9
Reply 23, posted (5 years 7 months 1 week 5 days 15 hours ago) and read 7494 times:



Quoting MasseyBrown (Reply 20):
Step one would have been the equity investment AF was prepared to make in DL in bankruptcy; it would be fun to know why that didn't happen.

As far as I know, it was because DL said they didn't need the AF investment to complete the merger with NW.


User currently offlineLipeGIG From Brazil, joined May 2005, 11459 posts, RR: 58
Reply 24, posted (5 years 7 months 1 week 5 days 14 hours ago) and read 7194 times:
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FORUM MODERATOR



Quoting DeltaL1011man (Reply 18):

I agree here 100%. IMO DL/AF need to look into finding more LHR slots.

That's a real challenge, together with the fact DL need to update it's product. The 763 is outdated for the customer.



New York + Rio de Janeiro = One of the best combinations !
25 Mayor : Interesting. Previous to this, there were separate JVs for cargo.
26 DeltaL1011man : Sure they could but why? They had a FRA hub. Thats the point of this deal. Now they just send PAXs via AF or KL(and IMO soon AZ) All LHR Opps will be
27 Avek00 : Star Alliance members are moving to implement JVs globally as well, and the UA/LH/AC/CO TATL JV starts with better hubs, superior fleet flexibility,
28 Breaker1011 : Markedly according to whom? UA - not such great shape AC - floating near BK Star will be living on CO and LH for a long time to come. UA's own pilots
29 Avek00 : CO is the champion of 757 TATL deployment, and UAL and LH offer a widespread availability of F, as well as a highly divesified widebody fleet. This w
30 Breaker1011 : I'll leave it to some of the Widgetguys to debate this endlessly, as I'm sure they will. But I'll throw in.... Both UA and CO, even combined, would b
31 Jetlanta : The problem with this argument is that just the combination of ATL/JFK alone is a better T/A hub network than the whole of what you are talking about
32 Jetlanta : Count up how many T/A departures Star has from IAH and YYC and explain to me how they can be termed "powerhouses" in any sense. Strong fares based on
33 United1 : Not really, UA and LH have had a JV in place for quite a few years, fundamentally all that is occurring with the "new" JV is UA and LH are adding CO
34 WorldTraveler : Let's not forget that UA's pilots, to the surprise of their company, filed an objection with the DOT asking that the enhanced Star JV to include CO no
35 Jetlanta : The level if integration between UA and LH isn't anywhere near what it is for DL/AF. They share revenues, not costs. Their planning is not "metal neu
36 Post contains links Jetlanta : I did a little data pulling and found some interesting information that shows exactly how evenly matched these two sets of carriers are across the Atl
37 DeltaL1011man : Good for the pilots. UA would more than likely use there JV to give up more flights to other airlines (ala the new JV with EI) where Delta isn't like
38 Jetlanta : They just got the DL/AF deal renegotiated. AZ will follow, I'm sure. You'd be surprised how complex these deals are. (And difficult to negotiate) Not
39 Max999 : Where's US? Why have they been left out?
40 STT757 : EWR is superior to JFK because CO handles more passengers through EWR than DL does through EWR, JFK and LGA combined. Advantage Star and EWR. ORD is
41 Mayor : And exactly why do you think this is? Just because DEN is larger doesn't make it a superior hub. DL's hub at SLC was superior to DEN when they were a
42 DeltaL1011man : good point. In terms of daily flights to Europe. We all know that The Delta hub is the South that will get the TATL flights is Atlanta. CO/IAH vs DL/
43 United1 : First they did NOT ask that it not be approved they asked for a DELAY so that wording could be added to the document protecting US jobs. Second this
44 Airzim : "The Emperor has no clothes" Can we all agree for the sake of sanity that Delta is the winner? Let's all agree they have the best hubs, fleets, strate
45 Mayor : I will if you will. Just as you seem to think that STAR and its members are the best thing since sliced bread, we also think the same of SKYTEAM and
46 United1 : Why is it the moment that someone points out that DL does not hold ALL the cards that they are against a particular airline/alliance? I don't see tha
47 Airzim : I'm sorry but I graduated from high school a long time ago. The "my dad can beat up your dad" debate was supposed to stop when you become an adult. I
48 STT757 : Just a couple months ago you were posting that a CO/UA merger was inevitable, now your saying it's not?..
49 Jetlanta : Come on, you compare ATL to IAD???? You can't match up hubs one-on-one. You have to match up the SYSTEM, the entire NETWORK. Each hub competes with t
50 Airzim : I give up. You completely missed the context of my statement, and continue to reenforce my earlier statements. Ok we get it. Delta wins. Can we move
51 United1 : Agreed completely and when it comes down to it the numbers show that both JVs are pretty evenly matched up. I was not the one who used the term power
52 Max999 : I guess that it was Star's choice not to include US since US has more to lose by not being part of the ATI agreement.
53 Viscount724 : Not sure what dates you are looking at but those numbers are not correct for the peak season. I show weekly nonstops to Europe as follow, based on Ju
54 MasseyBrown : The precise scope of the JV seems a little fuzzy, at least in my mind. From the DL press release in post 1: "The Air France KLM Group and Delta Air L
55 Jetlanta : I'm talking about flights operated by the Star JV carriers...AC & LH in this case. It was claimed that YYC was a Star T/A hub.
56 WorldTraveler : Your recollection is incorrect. DL's objections have been primarily about LH's ownership stake in B6 which operates in the same metro area as CO's la
57 LDVAviation : Well put. If you look at this joint venture thing from a strategic perspective, that's really the only conclusion you could draw. In fact, if we were
58 Mayor : Maybe it's because it seems to happen to DL more than ANY other airline on here. Not my quote.
59 WorldTraveler : funny. If it is representative of failure, then every other airline seems to be interested in the same thing. UA's spokesperson said that UA wants to
60 Avek00 : From the DOT Show Cause Order dated April 7, 2009: At its core, the proposed alliance features an integrated joint venture called Atlantic Plus-Plus
61 Avek00 : The JVs are not pretty evenly matched up - as the numbers posted previously indicate, the Atlantic-Plus-Plus JV participants will offer roughly 20% m
62 WorldTraveler : You are correct... but the US has not granted ATI to an airline in a country that does not have Open Skies or on routes to/from a country that does n
63 Mayor : I graduated LONG before you. I worked for DL for 33+ years and I'm proud of my airline. What is wrong with that? BTW, you'll find no actual "chest th
64 MasseyBrown : OK, enough about Star. Are the Skyteam non-US-European routes, such as to Africa and Latin America, part of the AF/DL JV? do the have ATI? or are they
65 United1 : Possibly because of the way that off topic posts on DL end up in threads on CO, UA, AA, US ect... I wasn't necessarily referring to size when I said
66 Mayor : I think that probably goes BOTH ways.
67 Airzim : Not quite. The point we're making is DL's failure to compete in the TATL market resulted in their subsequent marriage to AF/KL which precipitated in
68 Mayor : Yeah, we ARE good, aren't we?? BTW, if I wanted to get as nasty as you seem to want about this, I suppose this could be seen as a violation of the ru
69 Airzim : Here's the fundamental problem I have discussing anything with the fanboys, you can't actually have a discussion. You take everything so personal bec
70 JRadier : With these numbers there would only be 1 Canada-Europe city pair, which is incorrect. KLM alone serves YYZ, YYC, YUL and YVR so the difference of 1 c
71 Bobnwa : From reading the posting of Mayor, it would appear that he would be a very valued employee of DL before his retirement. What is your work history, th
72 Mayor : You may have not said it in exactly those words, but, this comes pretty close. So, in your world, retirees cannot meaningfully contribute to the disc
73 Bobnwa : Show me an airline that hasn't been involved in a merger in tha past. Did it mean they all admitted defeat? Kind of a tunnel vision view. Which categ
74 Panamair : By that same logic, UA failed a long time ago already to compete in the TATL market because they hitched themselves so closely to LH (in what accordi
75 Mayor : Well, it certainly seems as if Airzim's not one to let facts get in the way of a good browbeating.
76 MasseyBrown : I'd say my recollection is fine and you are the hip-shooter. The following is quoted from from DL's filing requesting additional information: "Now, t
77 WorldTraveler : What a lot of people fail to appreciate is that DL built its alliance with AF from the beginning based on DL operating to dozens of destinations outs
78 Avek00 : I strongly disagree. The Star JV has the benefit of immunized cooperation with six other sizeable European airlines in significant Euro markets (SK,
79 Panamair : Yes, but how much do they really cooperate and to what level, beyond codeshares? Joint planning and marketing, joint setting of fares, sharing of rev
80 Mayor : Thank you. I guess what he said was meant to be an insult, but I just considered the source. I KNOW how good we were and ARE and nothing he says will
81 United1 : That's true of all of the alliances thought...not every single member of skyteam works as closely with each other as DL and AF do. Reminds me of the
82 WorldTraveler : But as Jetlanta pointed out, the DL and AF led groups together have more seat share between the US and Europe under JVs than Star does, and DL and AF
83 United1 : And as Jetlanta also pointed out UA/LH/CO/AC have a larger share from North America to Europe. When it comes down to it both alliances have strength
84 Jetlanta : True, but keep in mind that the unique challenges of operating an integrated JV are very difficult and become even more difficult as more partners ar
85 United1 : Agreed completely I can see them adding SK, OS and LX but it will probably never include the entire Star ATI group. Even then I am sure they are goin
86 Seemyseems : Where does KLM stand in all this? What I mean is, will DL become a partner to KL like NW was? And will DL have a hub at AMS? Thanks.
87 NYC-AIR : My number #1 wish is for AF/KLM to help DL pay for a new JFK terminal. This is getting so ridiculous. It's embarrassing that O&D pax have to go throug
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