76er From Netherlands, joined Mar 2007, 463 posts, RR: 1 Posted (11 months 3 weeks 2 days 12 hours ago) and read 22417 times:
Funny FlightGlobal hasn't picked up on this one, but last week dutch newspaper De Telegraaf reported KL is to become an AF subsidiary instead of the present situation where AF an KL are both (more or less) equivalent companies in the AF/KL Group.
Of course, this was to be expected in the long run, but is has some unions up north worried.
Sorry, no link. The article was published in the paper version last friday with a follow up on saturday.
76er From Netherlands, joined Mar 2007, 463 posts, RR: 1 Reply 2, posted (11 months 3 weeks 2 days 11 hours ago) and read 21725 times:
Although I generally agree with you on this newspaper, when it comes to business topics they are usually very well informed. Like it or not, but KL is about to become another Air Inter, UTA, CityJet a.s.o., where Paris will be calling 100% of the shots.
LifelinerOne From Netherlands, joined Nov 2003, 1897 posts, RR: 8 Reply 5, posted (11 months 3 weeks 2 days 10 hours ago) and read 21071 times:
There is a talk about a new structure for the AF-KLM group, but that has been going on for years. So far I know, these are still the plans;
AF-KLM will remain as is. Both separate companies, under one holding. There will, however be, less subsidiaries;
* One cargo airline (Martinair is named)
* One regional carrier (CityJet), Air France recently started the integration for it's regional outlets like Régional. KLM Cityhopper is expected to join as last.
* One LCC (Transavia NL & France)
These plans are moving at a a very slow pace due to all the union issues involved. So are the unions at the regionals very concerned about the employee benefits under the CityJet umbrella. However, AF-KLM is going to push this issue to lower it's cost structure in the upcoming years. We are seeing the same at other European airlines (like Iberia and Lufthansa), all are looking at new vehicles to operate with lower costs.
The one big issue for the group is how to react when Alitalia wants to join. There are enough challenges integrating the AF-KLM branches at this moment, let a lone entering a third party.
The article of De Telegraaf was full of speculation due to the fact that the KLM CEO Peter Hartman is due to leave the airline next year and is to be replaced by former Minister of Transport Camiel Eurlings.
PanHAM From Germany, joined May 2005, 8270 posts, RR: 26 Reply 6, posted (11 months 3 weeks 2 days 10 hours ago) and read 20898 times:
Quoting LifelinerOne (Reply 6): The one big issue for the group is how to react when Alitalia wants to join.
Shut the doors, close the windows, change the mail adresses, phone numbers and pretend you don''t speak the language....
KLM has been through that before, with AZ and it failed. They simply chose the rwrong partners, AF and AZ should have teamed up with IB and BA would have been the perfect match for KL.
How can an efficiently run carrier, based in a country where they understand how to run a business, team up with an airline that is based in a state run economy ruled by an old boys network of L'ecole nationale?
Are you sure it will be named Cityjet ? AF is in the process of integrating its regional subsidiaries (Brit Air, Régional CAE and Airlinair) but the final name will only be unveiled at the beginning of 2013. Cityjet would make much sense though.
Quoting PanHAM (Reply 7): team up with an airline that is based in a state run economy ruled by an old boys network of L'ecole nationale?
Wow, what a balanced opinion ! I'm 100% open to criticism towards France, however you're going a bit too far, aren't you ? It's not like there are no successful international companies based in France...Accor, Safran, Total, LVMH, Chanel, SG, Hermès, Alstom, AXA, Essilor, Danone, EDF, L'Oréal, Michelin, Pernot Ricard, Gemalto to name a few...so much for a state-run economy !
PSA727LAX From United States of America, joined Oct 2012, 18 posts, RR: 0 Reply 15, posted (11 months 3 weeks 2 days 6 hours ago) and read 16191 times:
Is KLM going along with this willingly? I am surprised they aren't pushin to be the lead dawg in this train. If AF/KL are co-equals then it would stand that they would rather split off and go it alone again. I find it hard to believe that KL is willingly agreein to this unless they have already received verification in writing from AF that they will continue to rule their own fortunes; that this is striclty a way to clean up certian duplicative areas.
B747forever From Sweden, joined May 2007, 16813 posts, RR: 11 Reply 18, posted (11 months 3 weeks 2 days 5 hours ago) and read 14888 times:
Quoting 76er (Reply 16): There were some guarantees about keeping the KL brand and the AMS hub, but with an expiration date.
Quoting royaldutchgirl (Reply 17): It was expected, but wow, it is bad news... The end of KLM, Transavia, Martinair and the end of AMS as a hub.
Well done, the Netherlands! Many years ago you sold your aviation. Congratulations!
I really doubt that this will mean the end of KLM/AMS hub. No one in their right mind would close down a well functioning hub. Besides that, there is no way that AF can absorb all that extra traffic if AMS would lose its status as a major hub.
Me too. If the two are combining into one big airline, they would have to change their name, at least. AMS full of Air France titled planes, don't think so. Is there any other hub in Europe (or the world for that matter) that has an airline of another country there? Not to my knowledge...
one mile of road leads to nowhere, one mile of runway leads to anywhere
KLM is making money, but it would take a team of forensic accountants to determine whether Air France's losses are a true reflection of its performance or the result of fiscal engineering and clever accounting.
The holding company for both carriers is taking advantage of different tax rates and regulations between France and the Netherlands by assigning as much revenue as possible to KLM and as many expenses as possible to Air France, all that because any profit would be taxed higher in France than in the Netherlands.
For example, two years ago, Air France alone bore the loss of fuel hedges gone bad even though the contract covered both carriers.
This practice is neither new nor unique. A recent example is Starbucks that uses its Dutch subsidiary to sell supplies to subsidiaries in other countries in Europe at inflated prices calculated, again, to maximize profits in the Netherlands and minimize them in other countries such as the UK...
aloges From Germany, joined Jan 2006, 8522 posts, RR: 46 Reply 22, posted (11 months 3 weeks 2 days 4 hours ago) and read 14133 times:
Quoting nipoel123 (Reply 19): Is there any other hub in Europe (or the world for that matter) that has an airline of another country there?
There are countless examples, both current and historic. I was going to mention just a few, but got sort of carried away... because this shows just how international a business aviation is. I'll include focus cities because those focuses do include some sizeable operations:
Air Berlin at PMI and VIE
CityJet/Air France Regional at ANR, DUB, LCY and RTM
Easyjet and Ryanair all over the place
Flybe (Nordic) at HEL
Norwegian at ARN, CPH and HEL, among others
Qantas at SIN
United and Delta at NRT
Lufthansa Italia at MXP
Pan Am at FRA, LHR and HND/NRT
The entire LAN group has done away with the "national carrier" image, but is controlled by the Chileans.
The airlines of the TUI group are a pan-European amalgam.
BA has a small Danish franchise that hubs at BLL.
Air France even operates a mini hub at MIA, with two A320 based there.
Walk together, talk together all ye peoples of the earth. Then, and only then, shall ye have peace.
rwsea From Netherlands, joined Jan 2005, 3045 posts, RR: 2 Reply 23, posted (11 months 3 weeks 2 days 4 hours ago) and read 13513 times:
I suppose it's the next logical step. Over the past few years we've slowly but surely seen KLM's service degrade further and further. I suppose it will stop when the airline has sunk to the level of AF. Over the past few years we've seen:
- the "April Fools" devaluation of FlyingBlue, which has significantly decreased the value of the program
- the introduction of Economy Comfort in Europe as of this month, which now means that even gold/silver members have to pay an extra fee to sit in the front half of the airplane
- a gradual decrease in catering (sandwiches and snacks getting cheaper in quality, replacement of juice with sugary nectar drinks, etc.)
I suppose it's easier for AF to make cuts in service quality at KLM than it is to fix their own union messes.
AOMlover From France, joined Jul 2001, 1299 posts, RR: 12 Reply 24, posted (11 months 3 weeks 2 days 3 hours ago) and read 12992 times:
I suppose it's easier to put everything on AF's back rather than admitting that KLM is having its own issues too.
To be fair:
- I have a lot of admiration for KLM, what they achieved over all those decades and their identity which is, in my opinion, relaxed, friendly and professional,
- Schiphol is by a long shot my favorite airport in Europe,
- an airline which still operates pax MD11 desserves our respect in any case.
- Air France is not that bad as some people try to make it look here, I've logged 68 segments on AF that year alone (for 171 segments in total), short, médium and long haul, and I've never had to fill any complaint. I've always received courteous service and 97% of my flights left on time,
- CDG has improved a lot lately, mainly since the consolidation of AF operations in terminals 2E and 2F which are recent, airy and easy to navigate,
- even the on-board service is being improved. AF is bringing back hot meals on some segments (ex: CDG-TUN, 2h15mn Flight that I took last month)
- Nothing proves that the degradation of FB was dictated solely by AF. Ex-Fréquence plus members have suffered from this downgrade as much as ex-FD members. Other major FFPs have been severely downgraded lately. Miles and More just had its own version of the infamous "april's fool".
- the decrease in on board catering and the introduction of new ways to generate revenue such as "seat plus" or "economy comfort" are a general trend within major European airlines. How can AF be the only culprit if KL is doing the same cuts as everyone else ?
You make it sound as if KL is always the victim and AF always the hangman. Fact is, there are decision-makers in both companies and AFKL may already be more Integrated than you think,
25 SuperCaravelle: Exactly. It's much more complicated than a big bad airline and a smaller good airline. However, Dutch press is going viral with this story, of course
26 royaldutchgirl: Yep it seems like that's the next logical step. Sadly. As a dutch person, of course I would be sad to see good old KLM disappear or turn into a small
27 B747forever: Do you really believe that KLM will be dismantled? That would only be sheer stupidity as the AFKL group would lose massive amounts of traffic.
28 SuperCaravelle: If KLM were to go, AF would have to change it's colors and name as well, for patriotic reasons (Dutch citizens and press won't accept it). Throwing a
29 KL838: I don't they they will be a subsidiary under Air France, but rather stay as how they are under the AirFrance-KLM Group, i just don't see much advantag
30 AOMlover: Come on people, I understand your concern but why are you being so pessimistic ? We've been hearing this "KLM is going to be eaten by AF and AMS will
31 TexL1649: They'll have to keep the KL plane washing facilities. AF doesn't even own any, do they?
32 aloges: It's because AF represents the big, bad French bogeyman as much as LH represents the big, bad German bogeyman. You can't have a rational discussion w
33 BasilFawlty: I'm probably the only Dutch person who doesn't care if the KLM brand would disappear? I have absolutely no sympathy for KLM at all because of their at
34 L0VE2FLY: Hope this is just a rumor, it'll be a sad day to see the world's oldest airline go. I read on this forum several times that KLM can't be fully absorbe
35 SamuP: I truly, and very honestly have to say the day KL as an airline or a brand disappears it will probably be the end of my love for aviation. I still rem
36 blueflyer: I think there is a lot of jumping to conclusions. Just because the Air France - KLM holding company, the current parent of both carriers, disappears a
37 MauriceB: First of all, KLM denies all these accusations. The thing is that KLM just got way more efficient in the past couple of years by replacing its aging f
38 anstar: This makes more sense... There is a place for AF and a place for KL.... however why on earth do we still have all the regional carriers.... just crea
39 CARST: And there is a reason for it, I am always complaining about LH and AB, too. They are more expensive nearly all the time when flying long-haul compare
40 76er: Agreed. In the foreseeable future the brandname KL will continue to exist, if only because of bilateral and sentimental reasons. That doesn't have an
41 joost: Right so. Ever since the takeover / merger in 2004, people all over the country were predicting doom. KLM would disappear rapidly, the French would c
42 LifelinerOne: Hartman is scheduled for pension next year, and I have it from good sources that Eurlings is the confirmed man for the job. Well said! Well, the City
43 AF185: I couldn't agree more with your comments in this thread!
44 royaldutchgirl: Well yes, you've got a point there, but where there's smoke, there's fire in many cases. Besides, most human beings aren't always rational. That does