Moderators: jsumali2, richierich, ua900, PanAm_DC10, hOMSaR

 
User avatar
mercure1
Topic Author
Posts: 4791
Joined: Sun Jul 13, 2008 5:13 am

Rumor: La Compagnie + XL Airways merge; fly for Air France

Fri Oct 28, 2016 3:17 pm

Multiple French media reporting that XL Airways and La Compagnie are in "exclusive final" merger discussions.

While seemingly a very odd pair due different business models though both have lowcost base, it also being reported that XL is in talks with Air France of becoming basis for a lowcost-longhaul operation for AF as it continues to face mounting pressures particularly on service to French overseas territories from airlines such as Air Caraibes, French Blue and Corsair.

http://www.latribune.fr/entreprises-fin ... 11291.html
http://www.tourmag.com/XL-Airways-rache ... 83717.html
http://www.air-journal.fr/2016-10-28-ve ... 71694.html
http://www.air-journal.fr/2016-10-15-xl ... 71068.html
http://www.air-cosmos.com/xl-airways-et ... ment-84571

XL fleet for this winter is 5 A330 (3x -300, 2x -200) plus single 737-800, while La Compagnie has its two leased 757s.

Lets see if hints of longhaul/low cost concept for Air France is revealed next week when new Air France chairman is scheduled to present the groups "Trust Together" strategy.
mercure f-wtcc
 
a380787
Posts: 4573
Joined: Tue Jul 09, 2013 4:38 pm

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Fri Oct 28, 2016 3:25 pm

This is possibly the best outcome for La Compagnie considering the many negative (and sometimes grave) rumors about the company's future.
 
User avatar
LAXintl
Posts: 24621
Joined: Wed May 24, 2000 12:12 pm

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Fri Oct 28, 2016 3:33 pm

Guy behind La Compagnie must be a genius in flipping airlines.

He managed to sell L'Avion to BA for EUR €68 million.
From the desert to the sea, to all of Southern California
 
Curiousflyer
Posts: 583
Joined: Sun Oct 22, 2006 3:19 am

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Fri Oct 28, 2016 5:22 pm

Clearly a genius.
He wins market share and sells it away.
 
Curiousflyer
Posts: 583
Joined: Sun Oct 22, 2006 3:19 am

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Fri Oct 28, 2016 5:28 pm

Lots of things I did not know in the La Tribune article. Family ownership for La Compagnie, anonymous shareholders. Air Caraïbes is also family-owned. La Compagnie is actually leeping control and ultimate ownership.
 
User avatar
readytotaxi
Posts: 7427
Joined: Mon Dec 11, 2006 2:09 am

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Fri Oct 28, 2016 5:33 pm

Does La Compagnie turn in a profit each year?
you don't get a second chance to make a first impression!
Growing older, but not up.
 
Curiousflyer
Posts: 583
Joined: Sun Oct 22, 2006 3:19 am

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Fri Oct 28, 2016 9:05 pm

It is 2-3 years old and did not turn a profit so far. It started with EUR 30 million in capital and was re-capitalized with the same amount last year according to La Tribune.
XL does not turn a consistent profit either.
 
User avatar
Dutchy
Posts: 11825
Joined: Sat Nov 03, 2007 1:25 am

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Fri Oct 28, 2016 9:56 pm

Curiousflyer wrote:
It is 2-3 years old and did not turn a profit so far. It started with EUR 30 million in capital and was re-capitalized with the same amount last year according to La Tribune.
XL does not turn a consistent profit either.


Good company for Air France then ;-)

Why would Air France do this? Why not just create just a long haul Low Cost Carrier on their own?
Many happy landings, greetings from The Netherlands!
 
uberflieger
Posts: 1573
Joined: Fri Jun 28, 2013 6:22 pm

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Fri Oct 28, 2016 10:04 pm

Dutchy wrote:
Why would Air France do this?

I asked myself the very same question when BA bought out his previous failure, but that's exactly what makes him a genius! :)
 
Jetty
Posts: 1286
Joined: Wed Nov 11, 2015 12:27 pm

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Fri Oct 28, 2016 11:01 pm

Dutchy wrote:
Why would Air France do this? Why not just create just a long haul Low Cost Carrier on their own?


A reason could be that French unions would object against AF setting up a new subsidiary, while they are less likely to object against taking over another company. This makes little sense of course, but that's a given when dealing with French unions.
 
UltimoTiger777
Posts: 458
Joined: Sun Jul 17, 2016 5:19 pm

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Fri Oct 28, 2016 11:42 pm

Dutchy wrote:
Why would Air France do this? Why not just create just a long haul Low Cost Carrier on their own?


I don't quite understand (maybe it's the reduction in brain cells from working in a supermarket all day) this obsession with major carriers creating long haul low cost offshoots. Why not just rationalise their own brand and sell cheaper tickets? Nice expensive tickets for the first and business class people, nice cheap ones for the rest of us mere mortals?
 
yoni
Posts: 221
Joined: Sat Nov 28, 2015 7:39 am

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Sat Oct 29, 2016 12:26 am

Jetty wrote:
Dutchy wrote:
Why would Air France do this? Why not just create just a long haul Low Cost Carrier on their own?


A reason could be that French unions would object against AF setting up a new subsidiary, while they are less likely to object against taking over another company. This makes little sense of course, but that's a given when dealing with French unions.


I thought that the AF pilot unions were against taking over another company.... At this time, they have not expressed their position on this. And AF-KLM has denied having any discussions with XL.

I think that AF is much more concerned about its own operations (and dealing with its unions).
 
SpaceshipDC10
Posts: 7005
Joined: Tue Jan 01, 2013 11:44 am

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Sat Oct 29, 2016 12:46 am

UltimoTiger777 wrote:
Dutchy wrote:
Why would Air France do this? Why not just create just a long haul Low Cost Carrier on their own?


I don't quite understand (maybe it's the reduction in brain cells from working in a supermarket all day) this obsession with major carriers creating long haul low cost offshoots. Why not just rationalise their own brand and sell cheaper tickets? Nice expensive tickets for the first and business class people, nice cheap ones for the rest of us mere mortals?


Well if AF's crews flying to the Caribbean, Reunion and other sun destinations get the same wages as those flying to destinations where Business and First cabins are larger, then I can see why AF wants to try the longhaul lowcost off shoot. Obviously their costs are still too high to be compensated by simply cramming as many seats as possible on airplanes flying to leisure destinations in competition with Corsair, Air Caraïbes, XL and the others.
 
Curiousflyer
Posts: 583
Joined: Sun Oct 22, 2006 3:19 am

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Sat Oct 29, 2016 2:17 am

I actually bought a ticket to The French Caribbean not long ago and indeed in business class Air Caraïbes was about half of AF. And their business class seems fine. At the back the price difference was smaller but still significant.

Back to topic, I am curious to see how the dynamics of this weird arrangement will work with or without AF. Maybe the family owning most of the shares have a view on belly cargo capacity for their other businesses?
 
User avatar
LAX772LR
Posts: 13278
Joined: Sun Nov 09, 2014 11:06 pm

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Sat Oct 29, 2016 3:17 am

UltimoTiger777 wrote:
Why not just rationalise their own brand and sell cheaper tickets?

If it was "just" that easy.... then don't you think they would've DONE it already?

Lowering fares without lowering cost is a guaranteed recipe for losses.
And since most airlines can't just wave a magic wand, and make their mainline logistics cost less, they have to find other ways to lower the cost-- relying on regional affiliates' lower-paid staff, using completely depreciated aircraft, eliminating aspects of soft and hard product; are ways to get there.

And other the other end: attracting HVFs isn't as easy as just posting a four/five digit airfare, and thinking that someone will bite just because they can afford it. You need the proper mix of destination, schedule, product, and (often) contract, in order to make that happen. And that's before factoring in what the competition is doing, or economic fluctuations that can alter that model in an instant (e.g. drop in oil price).
I myself, suspect a more prosaic motive... ~Thranduil
 
User avatar
mercure1
Topic Author
Posts: 4791
Joined: Sun Jul 13, 2008 5:13 am

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Sun Oct 30, 2016 5:55 pm

Interview with CEO of XL. He does not confirm any deals, but does say it would be difficult for a traditional company(AF) to quickly develop internally a low cost operation from scratch. By acquring some one such as XL and La Compangnie, AF very quickly would have the required platform while also participating in consolidating the market place.

He states the biggest issue for low-cost arm at AF would likely be labor - particularly pilots, who are suportive of the concept of low cost operations, just want assurances that such activity does not create future detriment to growth at AF mainline.

http://www.lesechos.fr/industrie-servic ... 038817.php
mercure f-wtcc
 
uberflieger
Posts: 1573
Joined: Fri Jun 28, 2013 6:22 pm

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Sun Oct 30, 2016 7:13 pm

mercure1 wrote:
French media reporting that XL Airways and La Compagnie are in "exclusive final" merger discussions.


La Compagnie is likely being crushed by AF operating ORY-JFK. EC as well. Both have very little chance of survival, IMHO.
Frantz Yvelin's only hope is to sell out before his company goes belly up. Tying his company into a potential XL / AF deal (very likely) is probably his last chance.
Openskies may get replaced by an AA 788 (JFK-ORY) should the JV partners find it important to compete for customers in the South of Paris. Both companies have substantial data. I believe they will and can with a less premium heavy configuration. ORY-EWR will be part of the history books unless United also decides to get back into the game (former Continental route).
 
User avatar
N717TW
Posts: 563
Joined: Sun Feb 14, 2016 9:24 pm

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Sun Oct 30, 2016 8:25 pm

Jetty wrote:
Dutchy wrote:
Why would Air France do this? Why not just create just a long haul Low Cost Carrier on their own?


A reason could be that French unions would object against AF setting up a new subsidiary, while they are less likely to object against taking over another company. This makes little sense of course, but that's a given when dealing with French unions.


The unions are just as likely to object, but they have less say. They have control over the work groups and working conditions at AF; they have no say (per se) over the pay, condition and work group of a separate division within AF-KLM. Now, it possible the unions have some level of exclusive rights over any flying from France and I have no idea what the scope clause the French unions have with AF.
 
Curiousflyer
Posts: 583
Joined: Sun Oct 22, 2006 3:19 am

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Sun Oct 30, 2016 9:16 pm

I looked at the loads for the coming days and AF on ORY seems to be on par with EC with pretty full flights in all classes.

I could not see la Compagnie on Expertflyer. I wonder how this all thing makes sense still. It is a completely different business from AF's. And they already have Transavaia wo why buy some small airline with old unmatched aircraft?
 
User avatar
KarelXWB
Posts: 26968
Joined: Sun Jul 15, 2012 6:13 pm

Re: Rumor: La Compagnie + XL Airways merge; fly for Air France

Sun Oct 30, 2016 9:17 pm

La Compagnie, isn't this the company that asked Boeing to develop a "true" 757 replacement aircraft?
What we leave behind is not as important as how we've lived.

Popular Searches On Airliners.net

Top Photos of Last:   24 Hours  •  48 Hours  •  7 Days  •  30 Days  •  180 Days  •  365 Days  •  All Time

Military Aircraft Every type from fighters to helicopters from air forces around the globe

Classic Airliners Props and jets from the good old days

Flight Decks Views from inside the cockpit

Aircraft Cabins Passenger cabin shots showing seat arrangements as well as cargo aircraft interior

Cargo Aircraft Pictures of great freighter aircraft

Government Aircraft Aircraft flying government officials

Helicopters Our large helicopter section. Both military and civil versions

Blimps / Airships Everything from the Goodyear blimp to the Zeppelin

Night Photos Beautiful shots taken while the sun is below the horizon

Accidents Accident, incident and crash related photos

Air to Air Photos taken by airborne photographers of airborne aircraft

Special Paint Schemes Aircraft painted in beautiful and original liveries

Airport Overviews Airport overviews from the air or ground

Tails and Winglets Tail and Winglet closeups with beautiful airline logos