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Mortyman
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 2:39 am

Air France-KLM 2011 op loss seen 300 mln eur-report

Air France-KLM could post an operating loss of around 300 million euros ($392 million) in 2011 and even bigger losses in 2012 as economic woes and higher fuel prices take their toll, French daily Liberation reports.

Read more here:

http://www.reuters.com/article/2011/...3/air-france-idUSL6E7NN08T20111223


Sad if true. Seems like the struggles with operating cost for airlines will continue in the new year ... Was'nt aware that KLM / Air France struggled this much...

[Edited 2011-12-26 18:40:54]
 
LAXintl
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 3:09 am

Yes the AFKL group has issues which is leading to cuts and a strategy overhaul.

We've had a recent thread.
Air France KLM: Cuts To Costs And Capacity (by LHRFlyer Sep 5 2011 in Civil Aviation)
From the desert to the sea, to all of Southern California
 
B747forever
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 3:30 am

Doesnt KLM perform better than AF? I believe I read here on A.net that KLM is operating profitably while AF is the one making all the losses.
Work Hard, Fly Right
 
peanuts
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 4:17 am

Maybe this will finally make a few people think about truly streamlining this company.
I mean...Air France and KLM, the inefficiencies of two "separate" companies within one is just astounding. I don't even know where to start.
A reality check should force the issue but I doubt that it will.

If you want to keep the appearance of two companies on the outside, fine, knock yourself out. But within the company, AF and KL should practically be the same, in all sorts of departments. Sad news is: they aren't. Like night and day.
Precious Euro's are wasted on a daily basis just to keep a few french and dutch ego's in check.
 
rwsea
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 5:36 am

Quoting peanuts (Reply 3):

If you want to keep the appearance of two companies on the outside, fine, knock yourself out. But within the company, AF and KL should practically be the same, in all sorts of departments. Sad news is: they aren't. Like night and day.

  

From an outsider perspective, it seems that this company hardly gets any synergies from the merger. Aircraft orders are separate, reservations systems are separate, etc. One could think that the only reason AF purchased KL was to disguise their operating losses...
 
kiwiandrew

AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 5:55 am

Quoting rwsea (Reply 4):
One could think that the only reason AF purchased KL was to disguise their operating losses...

There is a common misperception that AF bought KL ( just as many people mistakenly believe that BA purchased IB) . In fact both AF and KL are owned by the same holding company Air France-KLM. It is true that the former shareholders of AF own a bigger share in the holding company than the former shareholders of KL but it is still untrue to say that AF bought KL.
 
varig md-11
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 7:04 am

Quoting rwsea (Reply 4):
From an outsider perspective, it seems that this company hardly gets any synergies from the merger. Aircraft orders are separate, reservations systems are separate, etc. One could think that the only reason AF purchased KL was to disguise their operating losses...

When AF launched the online check-in module, it read "klm check in" in the internet address tab...so I guess at one point there are some synergies.
Aircraft orders are not that separate: it is decided by the AF-KL group what has to be ordered and the they dispatch between the 2 entities
AF TW AA NW DL UA CO BA U2 TP UX LH SK AZ MP KL SN VY HV LS SS TK SQ PC RG IW SE LI TN
 
MH017
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 8:18 am

While AF used Altea for reservations, KL has abolished CORDA and uses Altea also nowadays; so, using 2 different reservationsystems is not correct...moreover, KLM will also change from CODECO to Altea Departure Control soon...
don't throw away tomorrow !
 
airproxx
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 12:25 pm

Quoting Mortyman (Thread starter):
Air France-KLM could post an operating loss of around 300 million euros ($392 million) in 2011 and even bigger losses in 2012 as economic woes and higher fuel prices take their toll, French daily Liberation reports.

The Losses come from AF, not KLM. KLM benefits are rather good currently in fact.
If you can meet with triumph and disaster, and treat those two impostors just the same
 
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Mortyman
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 12:58 pm

Quoting airproxx (Reply 8):
The Losses come from AF,

That does'nt really help KLM does it ? The two airlines don't have two seperate operating budgets, right ?
 
Curiousflyer
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 1:29 pm

KL needed a critical size and now has it with AF. Before they decided to merge with AF they had looked at other possibilities, e.g. BA and they picked AF.

Both respect their respective country's sensitivity, and enjoy flying rights in thise countries.

They serve different markets too, with KL generally offering lower fares, another reson to operate differently.

Still there are many synergies, as described above.

It is not all bad.

AF is facing many difficulties: expensive oil and labor, low cost competition in Europe, Emirates for long haul...
They have to adapt to the market, it will take time, fortunately they can affprd a little time.

They are trying, more or less successfully:
- regional bases with cheaper staff and operating costs.
- cutting routes
- cheaper aircraft like the A380
- decreasing the operating cost of certain services such as premium services, while trying to maintain quality
- changing the offering mix, maybe first class will go as a result.

Hopefully they will find the right strategy... But they are noy idle.
 
SASMD82
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 1:50 pm

Quoting airproxx (Reply 8):
The Losses come from AF, not KLM. KLM benefits are rather good currently in fact.

People not alligned to KLM often claim that loses only come from AF. Some people forget that KL has announced its own cost reduction plan too.

Quoting CuriousFlyer (Reply 10):
KL needed a critical size and now has it with AF. Before they decided to merge with AF they had looked at other possibilities, e.g. BA and they picked AF.

Both respect their respective country's sensitivity, and enjoy flying rights in thise countries.

They serve different markets too, with KL generally offering lower fares, another reson to operate differently.

Still there are many synergies, as described above.

It is not all bad.

AF is facing many difficulties: expensive oil and labor, low cost competition in Europe, Emirates for long haul...
They have to adapt to the market, it will take time, fortunately they can affprd a little time.

You are right!

[Edited 2011-12-27 05:51:47]
 
PezySPU
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 3:33 pm

Quoting airproxx (Reply 8):
The Losses come from AF, not KLM. KLM benefits are rather good currently in fact.

Since these figures are pretty big, I wouldn't be surprised if KL contributes to losses as well.

Quoting SASMD82 (Reply 11):
People not alligned to KLM often claim that loses only come from AF. Some people forget that KL has announced its own cost reduction plan too.

Relax, cost reduction plan doesn't mean they are generating loss, does it? It's what even the most profitable companies do from time to time.
 
LAXintl
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 5:58 pm

Frankly these companies such as AF-KL, IAG, LH Group need to do much more behind the scenes to generate synergy savings.

While the companies have opted to maintain multiple airline brands, maintaining executive and administrative offices in each country and duplicating many functions in every office is very costly. Departments like IT, reservations, finance, contracting, marketing/sales, human resources, etc need to be centralized more and work for the entire group and not only support a single carrier.

Yes combining things will create many redundancies, however as for profit organizations they need to become leaner and more efficient.

=
From the desert to the sea, to all of Southern California
 
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usdcaguy
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 6:11 pm

Quoting LAXintl (Reply 13):
While the companies have opted to maintain multiple airline brands, maintaining executive and administrative offices in each country and duplicating many functions in every office is very costly.

There's not much of a way around this when you're made up of staff coming from two different countries. It's a very political issue, and Europeans are very sensitive to the idea of another "country" taking over "their" airline. When we have mergers in the US, we're not as focused on whether or not we're keeping everyone in jobs. After a merger, most Americans are expected to pick up and move to another state, where everyone else speaks their language. This may be a difficult transition for most, but it is somewhat more concievable than for the Spanish at IB headquarters to adjust to life in London or those based at BA headquarters to pick up and move to Madrid. Of course, this situation lets everyone keep their job and life intact after the merger, which often does not happen in the States...

[Edited 2011-12-27 10:12:48]

[Edited 2011-12-27 10:13:26]
 
LAXintl
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 6:23 pm

Europe has many examples of multinational companies that work across borders as single entities.

Consolidation is nothing new in Europe and working across borders had only gotten ever easier in the last few decades. Add in benefits of technology, one does not need as strong physical presence in each country as if these were stand alone businesses.

Anyhow - my point is not that you move people from Holland to France or vice-versa, is that you eliminate certain functions completely in some places. Simply relocating them does not solve a cost problem.

Sure issues like ego's and unions might make if more difficult at AFKL, however ultimately running two full companies without significant back end synergy is not a model for success.
From the desert to the sea, to all of Southern California
 
Flighty
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 6:29 pm

Quoting usdcaguy (Reply 14):
Of course, this situation lets everyone keep their job and life intact after the merger, which often does not happen in the States...

They have jobs now, but if a company can't break even while doing best practices, eventually it will become a matter for the courtroom to decide on behalf of creditors. They come first and political symbolism and dreams come second at least here in the US. We will see if Europe really is deregulated. If they do have a free market, it will shake out the regionalism eventually. It serves little purpose for the flying public. Language and culture, yes. Is it enough to survive?.. watch balance sheets to find out ~~
 
staralliance85
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 7:13 pm

AF/KL has to do a better job. I understand that the Economic climate and Emirates must be killing them. But they have to improve their service.


1. Toss KLM's MD-11. I can't believe a major airline is still flying an antique like this. Even on the popular routes like JFK-AMS.

2. Air France failed to put flat Business Class seats on their planes (even the A380) so people would rather turn to other airlines.


3. Many Skyteam airlines fail to unify their relationships with one another (except DL with AF/KL). For example, AF/KL partnership with Korean, China Airlines ,China Eastern, China Southern and Vietnam Airlines is Not that strong. They don't even have an effective reservation system with partner airlines. For all Skyteam Members they have to catch up to Star Alliance.
brad Fitzpatrick
 
Bongodog1964
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 8:33 pm

Quoting LAXintl (Reply 13):
Frankly these companies such as AF-KL, IAG, LH Group need to do much more behind the scenes to generate synergy savings.

I can see that this statement might be valid for AF-KL & LH group, but IAG has only been in existence for a few months, we need to wait and see if they acheive the savings they promised from the amalgamation.
 
roberts87
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 9:31 pm

Quoting staralliance85 (Reply 17):
1. Toss KLM's MD-11. I can't believe a major airline is still flying an antique like this. Even on the popular routes like JFK-AMS.

What's wrong with the MD-11's? They've recently been refurbished, and have the same seats up front and in the back as the newer 777's. If I'm not mistaken, most of KL MD-11's are even newer then the 744's.

Quoting staralliance85 (Reply 17):
2. Air France failed to put flat Business Class seats on their planes (even the A380) so people would rather turn to other airlines.

I believe the group has ordered new fully lie flat seats for AF and KL.

Quoting staralliance85 (Reply 17):
3. Many Skyteam airlines fail to unify their relationships with one another (except DL with AF/KL). For example, AF/KL partnership with Korean, China Airlines ,China Eastern, China Southern and Vietnam Airlines is Not that strong. They don't even have an effective reservation system with partner airlines. For all Skyteam Members they have to catch up to Star Alliance.

That I agree. I've been travelling a lot recently, and Star Alliance feels more like an alliance - more integrated - then Skyteam.
 
panamair
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 9:39 pm

Quoting staralliance85 (Reply 17):
I can't believe a major airline is still flying an antique like this. Even on the popular routes like JFK-AMS.

The MD11 doesn't fly JFK-AMS. KL uses the 744/74E or 77E/77W on JFK-AMS.

Quoting roberts87 (Reply 19):
I believe the group has ordered new fully lie flat seats for AF and KL.

I don't believe any public announcement or mention has been made of AF getting flat bed J seats.
 
WindowSeat
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 10:13 pm

Quoting kiwiandrew (Reply 5):
There is a common misperception that AF bought KL ( just as many people mistakenly believe that BA purchased IB) . In fact both AF and KL are owned by the same holding company Air France-KLM. It is true that the former shareholders of AF own a bigger share in the holding company than the former shareholders of KL but it is still untrue to say that AF bought KL.

Please! Just like there is a holding company for America West and US Airways of which America West holds the majority share. Are you really telling me that America West didn't buy US Airways?

This is all technical. AF bought KL. Period. How you decide to structure the new company is up to you.
I'm all in favour of keeping dangerous weapons out of the hands of fools. Let's start with keyboards.
 
airproxx
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 10:27 pm

Quoting Mortyman (Reply 9):
That does'nt really help KLM does it ? The two airlines don't have two separate operating budgets, right ?
Quoting SASMD82 (Reply 11):
People not aligned to KLM often claim that loses only come from AF. Some people forget that KL has announced its own cost reduction plan too.

Both airlines have separate ops budget, but considering both results separately, KLM performs much better than AF does.
And it's a non secret that AF have proportionally bigger operating costs, this due to a different social law, a strong and bad union influence, and a much higher working class cost. Tax system is also a big problem for AF. We often laugh about it saying that AF should move its social base to Holland.
Anyway, KLM has much lower operating costs, and before this downturn in worldwide economy, KLM used to fill the hole that AF was digging.

Now this is a group logic, even if in order to cool down nationalist thoughts during the merger, both airlines kept their own identity, along with two separate ways to work.

I think that this split can be a luck for AF now, to get inspired from a way to work and to consider work that is much more efficient from our Dutch friends than French.
Unions can't be denying economical facts in France, and should get a more conscious behavior. One would say this is Utopia, but all those social moves, strikes and so on, are shocking especially during these bad times for a whole economic context. People, and particularly customers just don't get the french unions attitude. This gets people consider other carriers to fly, than AF. I do feel ashamed sometimes to be, well against myself, part of this circus.

CDG keeps on being the worst hub ever, and this for the 10th consecutive year. This is something that officials try to keep hidden, but this is a fact. And CDG cannot continue in this way without any consequence. This airport is a true nightmare for passengers. And things will get even worse when opening the S4.

For many reasons, AF has to take KLM work as an example, and has to improve.

I'm really frustrated and worried about many AF employees attitude today.
AF is not invulnerable, and the airline has to make big efforts to stay up against competitors, at the same level of service at least.
If you can meet with triumph and disaster, and treat those two impostors just the same
 
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TK787
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 10:40 pm

Anyone here know, what will be the total pax carried for KL in 2011?
 
billreid
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 11:37 pm

Quoting staralliance85 (Reply 17):

1. Toss KLM's MD-11. I can't believe a major airline is still flying an antique like this. Even on the popular routes like JFK-AMS.

I just booked a March flight from AMS-ATL. It is scheduled with a MD-11. Interesting acft for Hub-Hub. Sheds light on the death of MIA-AMS on KL.

Quoting staralliance85 (Reply 17):
2. Air France failed to put flat Business Class seats on their planes (even the A380) so people would rather turn to other airlines.

It is amazing that its taking this long, but AF has alot of other problems. None smaller than the aftermath of the A330 loss with all that has been made public and written. Are some in the press and travelers as well questioning AF training and safety? What is the impact on sales?
Some people don't get it. Business is about making MONEY!
 
MaverickM11
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AF/KL Possible Large Operating Loss

Tue Dec 27, 2011 11:45 pm

What exactly was the purpose of the merger/sale/whatever you want to call it if there was no consolidation behind the scenes?

Quoting airproxx (Reply 22):
We often laugh about it saying that AF should move its social base to Holland.

Why not? AF is having trouble competing with lower cost US carriers, never mind EU competition and GCC ego projects. More layoffs are likely, yet AF/KL can't merge the back end of the house? I'd assume EU politicians would care more about 1000s of frontline workers' jobs being canned than a smaller group of management, who they crap on all the time anyway.

Quoting panamair (Reply 20):
I don't believe any public announcement or mention has been made of AF getting flat bed J seats.

I thought their current angled seat was being spaced out such that it could finally recline to actual flat-bed...

Quoting airproxx (Reply 22):
CDG keeps on being the worst hub ever, and this for the 10th consecutive year. This is something that officials try to keep hidden, but this is a fact

I've never found that to be the case, particularly compared to the nastier bits of LHR and FRA. I really don't think that's a major factor in AF/KL's current situation.
E pur si muove -Galileo
 
pspfan
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AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 6:38 am

Quoting airproxx (Reply 22):

CDG keeps on being the worst hub ever, and this for the 10th consecutive year. This is something that officials try to keep hidden, but this is a fact. And CDG cannot continue in this way without any consequence. This airport is a true nightmare for passengers.

Since AMS and CDG are partners now, hopefully some things will change. I can tel you that they are learning some very basic things from eachother.

PSPfan
Fixit002Heavy
 
varig md-11
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AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 7:54 am

Quoting airproxx (Reply 22):
We often laugh about it saying that AF should move its social base to Holland.

At any rate, for the employees based in France AF-KL would have to pay French social contributions (cf U2 court case about their ORY UK contract staff that had to be repatriated and given a French contract)

Quoting airproxx (Reply 22):
Unions can't be denying economical facts in France, and should get a more conscious behavior. One would say this is Utopia, but all those social moves, strikes and so on, are shocking especially during these bad times for a whole economic context. People, and particularly customers just don't get the french unions attitude. This gets people consider other carriers to fly, than AF. I do feel ashamed sometimes to be, well against myself, part of this circus.

Some unions and staff still live in the 80's where no matter what, the state would pop up to save the ship and inject billions. They really don't want to see customers and time have changed: This is a big problem for AF and the country in general. We'll end up a museum frozen in the past.

Quoting airproxx (Reply 22):
CDG keeps on being the worst hub ever, and this for the 10th consecutive year. This is something that officials try to keep hidden, but this is a fact. And CDG cannot continue in this way without any consequence. This airport is a true nightmare for passengers. And things will get even worse when opening the S4.

I still don't understand how we manage to board/deplane a 747 by bus and park planes just anywhere on the platform (now the new trend is to park AF metal at CDG1....) with all these new gates and terminal: something is just wrong!
My 2 last longhaul MIA and COO with a 747 and an A340 with had to deplane by bus...in the winter, coming back from areas where it was +30 celsius...please

Quoting airproxx (Reply 22):
I'm really frustrated and worried about many AF employees attitude today.
AF is not invulnerable, and the airline has to make big efforts to stay up against competitors, at the same level of service at least.

I am very pessimistic : EK and QR are eating from above and U2 is eating the market from below.

-U2 CDG2B has become a very nice terminal, it's not 2F or E but certainly ahead of AF CDG2D, so people are no more treated like cattle at boarding (especially now U2 introduces assigned seating)...and onboard there is barely any difference now the "new" AF seat has been introduced (wooden hard & no recline anymore for those who don't know)

-EK and QR have developped like crazy: on some days QR operates 3XA346 and EK an A380 and 77W, and the flights are FULL most of the time.

Instead of sneering at competitors, AF should look at what they are doing and even take inspiration, maybe customers would come back and the deficit would be under control in addition to rationalisation at "la papeterie" (AF Headquarters). Pax are not a nuisance, they are the reason why you can put bread on the table
AF TW AA NW DL UA CO BA U2 TP UX LH SK AZ MP KL SN VY HV LS SS TK SQ PC RG IW SE LI TN
 
LifelinerOne
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AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 8:44 am

Quoting roberts87 (Reply 19):
What's wrong with the MD-11's? They've recently been refurbished, and have the same seats up front and in the back as the newer 777's. If I'm not mistaken, most of KL MD-11's are even newer then the 744's.

Well, yes. However, I'm hearing that spare parts are hard to get by to for reasonable prices. Looking at the new summer schedule for the MD-11, it is unusually light, especially with new airplanes set to join the fleet. I (and more people) have the distinct feeling that some MD-11's are set to be leaving the fleet in 2012.

Cheers!   
Only Those Who Sleep Don't Make Mistakes
 
mikey72
Posts: 1439
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AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 9:06 am

Quoting varig md-11 (Reply 27):
-EK and QR have developped like crazy: on some days QR operates 3XA346 and EK an A380 and 77W, and the flights are FULL most of the time.

Big deal !

London has..

QR..2xA346, 1x77W and 1xA333.

EK..2xA388, 2x773, 4x77W !!!

That's 12 daily departures compared to 5 at Paris.

Quoting varig md-11 (Reply 27):
and the flights are FULL most of the time.

You don't say !

Poor AF.

Better get used to it.

  

[Edited 2011-12-28 01:13:33]
Flying is like sex - I've never had all I wanted but occasionally I've had all I can stand.
 
PezySPU
Posts: 281
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 10:06 am

Quoting roberts87 (Reply 19):
What's wrong with the MD-11's?

Fuel and maintenance costs?

Quoting varig md-11 (Reply 27):
I am very pessimistic : EK and QR are eating from above and U2 is eating the market from below.

Yes, that is a very difficult problem many airlines are experiencing - finding themselves in the middle, trying to compete against two powerful but totally different business models.
 
mikey72
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 10:25 am

Quoting PezySPU (Reply 30):
Yes, that is a very difficult problem many airlines are experiencing - finding themselves in the middle, trying to compete against two powerful but totally different business models.

Look short-haul is knackered for legacy carriers around the globe.....it just feeds their long-haul ops at best. End of.

Long-haul is a different matter. All legacy carriers have to do (particularly AF and LH) is re-evaluate their size and cut costs.

BA went through this years ago. It's painful but a necessity with the likes of Easyjet, Ryanair, Emirates et al

Doesn't matter how big the likes of EK get....if AF, LH, BA etc do the above they ''should'' always be able to make CDG, FRA and LHR work for them.

(Let's face it...AF is still a bit of a dinosaur..if France didn't have such a vested interest in EADS AF probably should of delayed their A380 delivery. That would of been a good start)

[Edited 2011-12-28 02:31:43]

[Edited 2011-12-28 02:33:04]
Flying is like sex - I've never had all I wanted but occasionally I've had all I can stand.
 
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EPA001
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 11:45 am

Quoting mikey72 (Reply 31):
if France didn't have such a vested interest in EADS AF probably should of delayed their A380 delivery.


Rubbish. And this explains why AF (and KLM) have so many B777's and B77W's?
 
staralliance85
Posts: 181
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 1:33 pm

Quoting roberts87 (Reply 19):

What's wrong with the MD-11's? They've recently been refurbished, and have the same seats up front and in the back as the newer 777's. If I'm not mistaken, most of KL MD-11's are even newer then the 744's.


They can get away with the Md-11's if it were 2002. It is like driving a 1980 Pinto around town.
brad Fitzpatrick
 
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Mortyman
Topic Author
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 1:48 pm

Quoting staralliance85 (Reply 33):
They can get away with the Md-11's if it were 2002. It is like driving a 1980 Pinto around town.

Please state WHY " it's like driving a 1980 Pinto around ". You don't seem to have a good explenation other than the fact that you apparently don't like the MD 11 ... That's to easy
 
mikey72
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 2:34 pm

Quoting EPA001 (Reply 32):
Rubbish. And this explains why AF (and KLM) have so many B777's and B77W's?

777's aren't made in France.

Would of looked a bit odd if AF hadn't ordered any A380's.

Besides I said 'delay delivery' I didn't say 'not order' or 'cancel' the A380
Flying is like sex - I've never had all I wanted but occasionally I've had all I can stand.
 
varig md-11
Posts: 1112
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 3:01 pm

Quoting mikey72 (Reply 31):
(Let's face it...AF is still a bit of a dinosaur..if France didn't have such a vested interest in EADS AF probably should of delayed their A380 delivery. That would of been a good start)

I really don't see the necessity of being aggressive in your posts....what does it have to do with anything when you talk about EADS and French gov participation? AF is one of the main Boeing customers?

Plus, you dont't know what you're talking about: since the A380 joined the fleet, the loads are very good to JNB and JFK in particular, the A380 are not the problem.

Quoting EPA001 (Reply 32):
Rubbish. And this explains why AF (and KLM) have so many B777's and B77W's?

Exactly!

Quoting mikey72 (Reply 35):
777's aren't made in France.

Would of looked a bit odd if AF hadn't ordered any A380's.

That's the point buddy! 777 come from the US and are the backbone of AF: so what your silly remark about EADS and France interest was about?
And yes, it would have been odd that we assemble the A380 right here and the national airline doesn't buy it while it can put it on some lines where it generates money.

It would be completely stupid to manufacture a plane that we sell to DXB corp for them to be a bright child while we "wait" for things to be worse for us
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mikey72
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 3:42 pm

Quoting varig md-11 (Reply 36):
I really don't see the necessity of being aggressive in your posts....what does it have to do with anything when you talk about EADS and French gov participation? AF is one of the main Boeing customers?

Who's being aggressive ?

Now is not the economically right time for a loss-making airline to be introducing the worlds largest passenger jet to its fleet.

It's got nothing to do with Boeing. If France were not so connected to the A380 project I feel sure that AF might have considered delaying delivery. It's no slight on anyone. It's understandable.

Quoting varig md-11 (Reply 36):
Plus, you dont't know what you're talking about: since the A380 joined the fleet, the loads are very good to JNB and JFK in particular, the A380 are not the problem.

You could fill a treble decker aircraft to JNB and JFK from Europe if your fares are low enough.

Not very good for your margins though is it ?

Quoting varig md-11 (Reply 36):
It would be completely stupid to manufacture a plane that we sell to DXB corp for them to be a bright child while we "wait" for things to be worse for us

2012 is going to be an economically teriible year. Especially for Europe............

DXB and state funded EK might aswell be on another planet...it's no comparison i'm afraid.
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shamrock604
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 3:50 pm

This AF only bought the 380 cos it French thing is ridiculous, and shows a lack of knowledge about the structure of AF's long haul network.

The A380 is an obvious aircraft for AF because it has many high demand long haul routes with multiple daily flights where it simply makes sense to put on a huge aircraft and cut costs thus squeezing every bit of yield possible out of the route.

Quoting mikey72 (Reply 31):
Look short-haul is knackered for legacy carriers around the globe.....it just feeds their long-haul ops at best. End of.

I agree with that - you just need to look at Ireland and the UK and the adaptations Aer Lingus and BA have had to make to survive the low cost era to see what it will end up like everywhere else. This is simply because Ireland and the UK were the first two European nations where low cost really took off. You can live in denial, or just get on and do what needs to be done. This means adopting a "lower cost" ethic, with greater asset utilisation, one way fare structures, higher load factors, bigger aircraft with less frequency and slimmed down services. Hopefully, you will do enough to stem the losses on short haul and continue to feed your long haul to generate a significant over all profit. Better still, you turn short haul into a profit generator in it's own right.

Quoting mikey72 (Reply 31):
(Let's face it...AF is still a bit of a dinosaur..if France didn't have such a vested interest in EADS AF probably should of delayed their A380 delivery. That would of been a good start)

AF are far from being a dinosaur - they know exactly what needs to be done, but bringing their labour unions with them is a problem.

Quoting airproxx (Reply 22):
CDG keeps on being the worst hub ever, and this for the 10th consecutive year. This is something that officials try to keep hidden, but this is a fact. And CDG cannot continue in this way without any consequence. This airport is a true nightmare for passengers. And things will get even worse when opening the S4.

CDG is getting better, and once everything is consolidated in 2E and 2F, it will probably work much better. But, 2G and its remote location was a stupid mistake, considering it is that traffic that feeds long haul. It should at least have been linked to CDG VAL or to the 2E/2F train transit system.

Aircraft parking is bizarre, but sadly this is what happens when you spread your operation over 5 terminals - being in 2E and 2F should solve much of that, but I fail to see why ADP did not just opt for an ATL style layout and solve all the issues.

Finally, AF ground staff are awful. They spend far too long on basic tasks, and seem to want to look serene instead of wanting to get the job done fast and cut the queues. The check in system in 2E is a total joke - if you check in online, one should not have to spend so long in a queue for bag drop!
 
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 4:57 pm

Quoting mikey72 (Reply 37):
Now is not the economically right time for a loss-making airline to be introducing the worlds largest passenger jet to its fleet.

You are wrong big time: if by introducing an A380 on JFK or JNB you replace two 772 (which is the case for AF) you generate savings and not losses.

Quoting mikey72 (Reply 37):
Not very good for your margins though is it ?

Everytime I check the loads F and J are quite good on AF A380 and as I said before, if you fill Y with pax normally spread on two 772, you save money

Quoting mikey72 (Reply 37):
DXB and state funded EK might aswell be on another planet...it's no comparison i'm afraid.

Why? EK cheerleaders on this forum say it's a normal airline not funded by the state....you have insider info?
If it's a state funded airline then I agree with you, it's 2 different worlds
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 5:30 pm

Quoting varig md-11 (Reply 39):
You are wrong big time: if by introducing an A380 on JFK or JNB you replace two 772 (which is the case for AF) you generate savings and not losses.

Well actually I am bemused as to why with only 6 A380's currently in service they put one of them on the JFK ?

Quoting varig md-11 (Reply 39):
Everytime I check the loads F and J are quite good on AF A380 and as I said before, if you fill Y with pax normally spread on two 772, you save money

Yes you do but in these austere times what costs (from financing right through to training) have been incurred introducing the aircraft to the fleet ?

By your reasoning every airline in the world would have a fleet of the latest jets whether they could afford them or not.

Quoting varig md-11 (Reply 39):
Why? EK cheerleaders on this forum say it's a normal airline not funded by the state....you have insider info?
If it's a state funded airline then I agree with you, it's 2 different worlds

I would imagine that if EK is state owned then it is state funded. N'est-ce pas ?
Flying is like sex - I've never had all I wanted but occasionally I've had all I can stand.
 
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shamrock604
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 5:36 pm

Quoting mikey72 (Reply 40):
Well actually I am bemused as to why with only 6 A380's currently in service they put one of them on the JFK ?

Because it fits in the schedule between longer haul flights and allows maximum utilisation of the aircraft, and allows them to cut two flights to one, thereby cutting costs and increasing profits on a strong route.

Quoting mikey72 (Reply 40):
Yes you do but in these austere times what costs (from financing right through to training) have been incurred introducing the aircraft to the fleet ?

If this is the case, then should not every airline just stop buying any new aircraft? The A380 makes ultimate sense for AF.
 
UALWN
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 5:53 pm

Quoting mikey72 (Reply 37):
Now is not the economically right time for a loss-making airline to be introducing the worlds largest passenger jet to its fleet.

Do you mean that it is not the right time to introduce the airplane with the lower CASM?

Quoting mikey72 (Reply 37):
If France were not so connected to the A380 project I feel sure that AF might have considered delaying delivery.

Really? Do you have any information to back that up? Or is it just your opinion? If so, my opinion, for whatever it's worth, is exactly the opposite: AF, as BA and LH, are the obvious European customers for this aircraft, due, among other things, to their huge 744 fleets.

Quoting mikey72 (Reply 40):
Well actually I am bemused as to why with only 6 A380's currently in service they put one of them on the JFK ?

Uh? Don't you think AF should use the 380 on CDG-JFK? Where should they use it then? CFE-DSM?

[Edited 2011-12-28 09:54:36]
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shamrock604
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 6:02 pm

I think we are just dealing with some nationalistic chest beating here. In some quarters AF = FRANCE = AIRBUS, therefore AF ordering A380 = nationalistic move to promote Airbus = promotion of the French state.

Clearly, AF had the same motive when it ordered 56 Boeing 777's, and equipped it's regional partners with British, Dutch and Brazilian built aircraft when ATR's could have been deployed.

To certain people, AF is inherently corrupt/evil and nothing they do has any form of sense despite the fact that their own airlines are doing exactly the same.
 
mikey72
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 6:53 pm

Quoting shamrock604 (Reply 41):
If this is the case, then should not every airline just stop buying any new aircraft? The A380 makes ultimate sense for AF.

Well I did say 'delay' and not 'stop'...big difference.

Quoting shamrock604 (Reply 41):
Because it fits in the schedule between longer haul flights and allows maximum utilisation of the aircraft

And the 773 doesn't ?

Quoting shamrock604 (Reply 41):
and allows them to cut two flights to one,
JFK is a route that demands frequency...even from CDG.

Quoting UALWN (Reply 42):
Do you mean that it is not the right time to introduce the airplane with the lower CASM?

It is never wrong to introduce an aircraft with lower CASM but I am assuming that AF are not simply picking up their A380's gratis ?

Quoting UALWN (Reply 42):
AF, as BA and LH, are the obvious European customers for this aircraft, due, among other things, to their huge 744 fleets.

By that reckoning BA should have the largest fleet of A380's.......

BA has more use on a greater range of routes for the A380 than either AF or LH. They have more 744's than AF and LH combined and the largest fleet of twin aisle long-haul aircraft out of the 3 airlines.

YET - they have chosen to delay the delivery of their A380's.

Why ?

[Edited 2011-12-28 10:55:08]
Flying is like sex - I've never had all I wanted but occasionally I've had all I can stand.
 
UALWN
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 7:16 pm

Quoting mikey72 (Reply 44):
They have more 744's than AF and LH combined

Err, they didn't before AF and LH started getting 380s!

Quoting mikey72 (Reply 44):
YET - they have chosen to delay the delivery of their A380's.

Why ?

I don't know. But I wonder if the abysmal financial performance of BA in the last few years compared to their peers (LH Group, AF/KLM) may have had something to do with that...
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shamrock604
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 7:19 pm

Quoting mikey72 (Reply 44):
Well I did say 'delay' and not 'stop'...big difference.

Why should they have delayed it? So their competitors can get there hands on it faster?

Quoting mikey72 (Reply 44):
And the 773 doesn't ?

I meant that JFK fits nicely in the schedule between other A380 rotations, and allows them to squeeze maximum utility from the A380 on a route which justifies its capacity.

Quoting mikey72 (Reply 44):
JFK is a route that demands frequency...even from CDG.

And AF offers the best frequency on the route.. even with the reduction of one daily flight.

Quoting mikey72 (Reply 44):
It is never wrong to introduce an aircraft with lower CASM but I am assuming that AF are not simply picking up their A380's gratis ?

Neither are BA. What's the point exactly?

[Edited 2011-12-28 11:25:21]
 
varig md-11
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 8:01 pm

Quoting mikey72 (Reply 40):
I would imagine that if EK is state owned then it is state funded. N'est-ce pas ?

If by "funded" you mean DXB corp launched the ailrine and put €€€ on the table to buy 50 something A380, well I guess so.
If by funded, you mean that operations, profitable or not, are supported by the state like some legacies in the past, then...je ne sais pas.
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mikey72
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 8:16 pm

Quoting UALWN (Reply 45):
I don't know. But I wonder if the abysmal financial performance of BA in the last few years compared to their peers (LH Group, AF/KLM) may have had something to do with that...

AF posted an operating loss of 300M in 2011 with worse to come in 2012. The year before last they posted a loss of 1.6B.

LH wants to save 1.5B in the coming year.

BA's relatively hard fought for link up with IB and AA and 'completed' cost cutting program will push the airline back into the black next year. So the outlook for the 3 airlines is slightly different.

BA have been positioning themselves over the last few years which has at times been painful...as AF and LH will soon have to embark upon........

Quoting UALWN (Reply 45):
Err, they didn't before AF and LH started getting 380s!

Well so far AF have 6 A380's and 12 744's and LH have 8 A380's and 30 744's. I don't think they have disposed of 25 744's between them have they ? (They'd need more than 14 A380's to keep capacity up if they have ??)

Quoting shamrock604 (Reply 46):
Neither are BA. What's the point exactly?

The point is BA aren't because of the global economy. AF are. Pourquoi ?

Don't you think that BA at capacity restricted LHR with their high capacity long range O&D network (with the London Olympics coming up) would of delayed their A380's unless they thought the outlook across Europe absolutely demanded it ?
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shamrock604
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RE: AF/KL Possible Large Operating Loss

Wed Dec 28, 2011 8:21 pm

Quoting mikey72 (Reply 48):
The point is BA aren't because of the global economy. AF are. Pourquoi ?

Ah, now you are skipping around the point.

You said that AF are not getting the aircraft "gratis".

I simply stated that neither were BA.

You will also be aware that AF began taking delivery of the A380 some time ago, so they did not have the option of delaying the order in the first place.