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abrelosojos
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 3:18 pm

This is the longest serving marital feud in the history of aviation. I think if this happens, most of the Dutch in Amstelveen would open bottles of bubbles (champagne of course), and celebrate. I can't imagine the amount of times I have heard they think KL will be better off ...

Saludos,
Alex
Live, and let live.
 
fa4af
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 3:25 pm

Thibault973 wrote:
jfk777 wrote:
Why KLM ever merged with Air France never made any sense, AF has always been the second worse run airline in Europe after Alitalia. KLM would fit very nicely in the IAG portfolio, especially with their 777 & 787 long haul fleets.


?? When KL merged with AF, KL was loss making while AF was the single most profitable airline in the world.


Thank you for putting things back into their proper perspective..
indeed, one could wonder what AF had been busy with all these years...like feeding AMS for instance...rather than making the right internal and much needed turnaround...

Time for these reforms has finally come, and we are lucky to have had one another to perform better than each one alone.

KL with BA or LH?? go for it, please...! I am not sure the Dutch staff as some go as far as saying, who are oh so tired of paying for the "lazy French big liars" to put it roughly, would be any happier within any other group, and we all agree that really no airline grouping has let so much freedom to its members..compare with Latam for example..
Indeed it takes compromises to make a marriage work on the long run

For those of you wondering if the French aid is tied to conditions, any type of reform and so on: sorry in French only
https://www.forbes.fr/business/air-fran ... reloaded=1

quick review:
-reduction of CO2, emissions and becoming the most environmental friendly airline group in the World (which already seems to be the case if you take into consideration AFKL logn standing number 1 ranking in the Dow Jones sustainability index https://www.airfranceklm.com/en/air-fra ... lity-index OR if you really insist on the Dutch bias..https://klmtakescare.com/en/content/top ... lity-index)
-a huge run for profitability adn cost cutting plan that should take the AF part to a profit margin of 7 to 8% against 5 today

This entails
-ditching HOP
-developing Transavia to all domestic operations except for la Navette (Orly only)
-keeping AF metal on the european and domestic feed to CDG
-retirement of anyone above 55
-reduction of 6000 staff including 3000 crew
-transforming the digital operations company wide
-more cooperation with the French rails and notably the TGV
-renegotiating the infamous airport taxes in Paris alognside a not less needed revamping of the services offered at CDG compared to other major hubs
-a lot of uncertainty around the outter crew bases such as Nice or Toulouse
and so on
in a nutshell, Ben Smith and Anne Rigail, with the backing of Pieter Elbers, have to unfold their major 5 year plan for AF in a 2 year time frame so as to be able to reimburse the massive State aid.

Nothing, really.

stay safe and come fly with us, AFKLM
à bientôt dans nos avions
Groetjes iedereen!
 
f4f3a
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 3:30 pm

A bit far fetched but what about if KLM bought out virgin ? . Could be interesting
 
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MrBren
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 3:34 pm

Which airline could afford to buy another airline at this moment?
Last edited by MrBren on Mon Apr 27, 2020 3:34 pm, edited 1 time in total.
 
Edax
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 3:34 pm

Practically AF-KL is working out fine. Networks are well aligned. Ams and cdg are big but they are quite ok for transfer, and the half hour shuttle between them makes them essentially one airport.

This in contrast to Londen. I still have the suspicion that after the battle over Britain the English have decided to make their airport system so complicated that the enemy would never figure out which terminal they had to bomb. So merger with BA wouldn’t work for me.

Problem is the difference in culture. Af is trying to deliver more service and consequently runs lower margins, plus they have to deal with French labour (laws). If anything I think this is more an attempt to put pressure on the French to balance that, than a real proposal, since I can’t see either one gaining from a split.
 
CFRPwingALbody
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 3:41 pm

Wow, those conditions for the French state aid are serious. But AFAIK if KLM would try to retire all employees aged 55+, they are bankrupt. Reason they have to compensate for 10-12 years of lost employment.
 
Ziyulu
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 3:45 pm

No, if KLM joins IAG, they will have BOB on short haul to align with BA and IB.
 
chonetsao
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 3:50 pm

Why KLM has to join IAG after leaving Air France? Why not KLM merge with Finnair to create a new partnership with duo hub in Amsterdam and Helsinki. So Amsterdam serves British secondary cities, North America and Latin America whereas Finnair take over most of the Far East flying? In that way, KLM can join oneworld as a unified KLM-Finnair group, its cooperation with China Southern and maybe a future relationship with JAL could make an interesting KLM-Finnair-China Southern-JAL four way EU-Far East JV.

I am just saying, IAG is not the only answer after Air France.
 
petertenthije
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 4:04 pm

CFRPwingALbody wrote:
Would the EU allow Alitalia and Air Europe murging with AF-KLM into a skyteam Europe group of airlines. I think this would be the best scenario for competition.
It would not be best for competition. A merger of AF/AZ/KL/AE would be bankrupt within a year with both AF and AZ being unwilling to bite the bullet on cost savings. I am not familiar enough with Air Europe to comment on them.
Attamottamotta!
 
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YULflyguy
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 4:21 pm

Well.....good for them! I never liked the fact the KL went with AF to be honest. I always enjoyed flying with KL, I've had some of my best flights with them and for me AF didn't match up with them.

I know they were struggling and it was a way to save the company but I would love to see KL survive on their own now or with better carrier.
 
blueflyer
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 4:37 pm

fa4af wrote:
For those of you wondering if the French aid is tied to conditions, any type of reform and so on: sorry in French only
https://www.forbes.fr/business/air-fran ... reloaded=1
-ditching HOP
-retirement of anyone above 55
-reduction of 6000 staff including 3000 crew

Just wondering how much pain they're going to inflict on the workforce. Does the 6,000 staff reduction include closing HOP and mandatory early retirement, or does it come on top of that?

Either way, if these measures had come out when home confinement was not mandatory and strictly enforced, Ben Smith and Anne Rigail would have to go into hiding. As militants as French unions are, the mere mention of proposals as tough (for France) as these would turn the streets of Paris into urban warfare the likes of which would make every French strike until then seem like a Sunday stroll along the Seine by comparison.
 
davidjohnson6
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 4:39 pm

I think we are getting just a little bit too excited about this... I would expect something much more substantial before imagining AF and KL might loosen their ties
 
Arion640
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 4:42 pm

jfk777 wrote:
Why KLM ever merged with Air France never made any sense, AF has always been the second worse run airline in Europe after Alitalia. KLM would fit very nicely in the IAG portfolio, especially with their 777 & 787 long haul fleets.


On the contrary KLM operate 737’s which won’t fit well with IAG’s short haul fleet.
 
AMS18C36C
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 4:44 pm

f4f3a wrote:
A bit far fetched but what about if KLM bought out virgin ? . Could be interesting


What does VS have to offer KL?
 
Amsterdam
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 4:49 pm

All this speculation.
But what would KLM do without de JV with Delta?
United and AA already have their european hubs, so KLM and Delta wont stop working together.
 
Amsterdam
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 4:54 pm

fa4af wrote:
Thibault973 wrote:
jfk777 wrote:
Why KLM ever merged with Air France never made any sense, AF has always been the second worse run airline in Europe after Alitalia. KLM would fit very nicely in the IAG portfolio, especially with their 777 & 787 long haul fleets.


?? When KL merged with AF, KL was loss making while AF was the single most profitable airline in the world.


Thank you for putting things back into their proper perspective..
indeed, one could wonder what AF had been busy with all these years...like feeding AMS for instance...rather than making the right internal and much needed turnaround...

Time for these reforms has finally come, and we are lucky to have had one another to perform better than each one alone.

KL with BA or LH?? go for it, please...! I am not sure the Dutch staff as some go as far as saying, who are oh so tired of paying for the "lazy French big liars" to put it roughly, would be any happier within any other group, and we all agree that really no airline grouping has let so much freedom to its members..compare with Latam for example..
Indeed it takes compromises to make a marriage work on the long run

For those of you wondering if the French aid is tied to conditions, any type of reform and so on: sorry in French only
https://www.forbes.fr/business/air-fran ... reloaded=1

quick review:
-reduction of CO2, emissions and becoming the most environmental friendly airline group in the World (which already seems to be the case if you take into consideration AFKL logn standing number 1 ranking in the Dow Jones sustainability index https://www.airfranceklm.com/en/air-fra ... lity-index OR if you really insist on the Dutch bias..https://klmtakescare.com/en/content/top ... lity-index)
-a huge run for profitability adn cost cutting plan that should take the AF part to a profit margin of 7 to 8% against 5 today

This entails
-ditching HOP
-developing Transavia to all domestic operations except for la Navette (Orly only)
-keeping AF metal on the european and domestic feed to CDG
-retirement of anyone above 55
-reduction of 6000 staff including 3000 crew
-transforming the digital operations company wide
-more cooperation with the French rails and notably the TGV
-renegotiating the infamous airport taxes in Paris alognside a not less needed revamping of the services offered at CDG compared to other major hubs
-a lot of uncertainty around the outter crew bases such as Nice or Toulouse
and so on
in a nutshell, Ben Smith and Anne Rigail, with the backing of Pieter Elbers, have to unfold their major 5 year plan for AF in a 2 year time frame so as to be able to reimburse the massive State aid.

Nothing, really.

stay safe and come fly with us, AFKLM
à bientôt dans nos avions
Groetjes iedereen!


This is by far not enough.
This is what they should do without corona virus.

But now things are much worse.
Staff has to go because the flights wont be there for quite a while.
But more importantly; salary and leave should go down significantly.
You can cut staff by 20% but if your flights are also minus 20% than your cost base will be still the same.

The cost of each staff member should be much lower. I read nothing about that.
 
petertenthije
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 5:00 pm

Arion640 wrote:
On the contrary KLM operate 737’s which won’t fit well with IAG’s short haul fleet.
IAG has 200 737MAX's on order. Of course, these being MAX's, when these are to be delivered is anyone's guess. :)
Attamottamotta!
 
NLINK
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 5:03 pm

IAG has not ordered 200 737MAX. They signed a LOI for 200 737MAX which is not an order. I expect it to not materialize after COVID-19
 
Thibault973
Posts: 322
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 5:24 pm

Flanker7 wrote:
Thibault973 wrote:
jfk777 wrote:
Why KLM ever merged with Air France never made any sense, AF has always been the second worse run airline in Europe after Alitalia. KLM would fit very nicely in the IAG portfolio, especially with their 777 & 787 long haul fleets.


?? When KL merged with AF, KL was loss making while AF was the single most profitable airline in the world.

How times have changed, that was then this is now.


I'm not saying otherwise but was simply responding to the false statement " AF has always been the second worse run airline in Europe after Alitalia.".

Btw, #2 and #3 in 2007 were Gol and Virgin Blue, while most US airlines were losing money. How things have changed like you said.

Nevertheless, let's remember that AF has been profitable for the last few years also its margin is pretty low, it is still profitable.

AF loses mainly come from its domestic unit, where it competes with an efficient HS rail system and U2, FR and now V7, which are challenges KL simply does not have to face.

+ as profit taxes are wayyyyy lower in the NL than France, it is common knowledge that AFKL balances its sheet to write off most of its debts and loses in France (exactly the same way Google France and Amazon France both are "loss making" ;) )
 
airbuster
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 5:28 pm

For what it’s worth: I’m Dutch, I work for KL and I would hate a breakup.

AF saved us of our own peril in the past, we owe them a lot.
FLY FOKKER JET LINE!
 
jfk777
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 5:32 pm

Thibault973 wrote:
jfk777 wrote:
Why KLM ever merged with Air France never made any sense, AF has always been the second worse run airline in Europe after Alitalia. KLM would fit very nicely in the IAG portfolio, especially with their 777 & 787 long haul fleets.


?? When KL merged with AF, KL was loss making while AF was the single most profitable airline in the world.


Air France could been very profitable when they merged but AF is hardly an airline with a huge profitable history. AF is known for its militant screw the company unions. They just had to bring in a Canadian to run AF because the relations were so poisonous between management and employees. How much did "profitable" AF just spend in the last ten years on A380 that likely aren't going to fly again. Hardly an example good management.

What wise decision did the Canadian do, order a whole bunch of A350-900, now that is a smart CEO ordering a plane they can fill and fly to Buenos Aires, Tokyo Haneda, San Francisco and Singapore.
 
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TWA772LR
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 5:48 pm

DL will buy a stake in KL before IAG does. Skyteam cant afford to lose KL and DL has made it a point to invest in airlines to sway them away from others and they will fight until the bitter end for KL.
When wasn't America great?


The thoughts and opinions shared under this username are mine and are not influenced by my employer.
 
FGITD
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 5:54 pm

jfk777 wrote:
Thibault973 wrote:
jfk777 wrote:
Why KLM ever merged with Air France never made any sense, AF has always been the second worse run airline in Europe after Alitalia. KLM would fit very nicely in the IAG portfolio, especially with their 777 & 787 long haul fleets.


?? When KL merged with AF, KL was loss making while AF was the single most profitable airline in the world.


Air France could been very profitable when they merged but AF is hardly an airline with a huge profitable history. AF is known for its militant screw the company unions. They just had to bring in a Canadian to run AF because the relations were so poisonous between management and employees. How much did "profitable" AF just spend in the last ten years on A380 that likely aren't going to fly again. Hardly an example good management.

What wise decision did the Canadian do, order a whole bunch of A350-900, now that is a smart CEO ordering a plane they can fill and fly to Buenos Aires, Tokyo Haneda, San Francisco and Singapore.



Incredible work by Ben Smith to get AF to order 28 a350s back in 2013 while also launching Air Canada Rouge, 5 years before becoming the CEO.

I realize he was in charge when the most recent 10 were ordered, but there's magnitudes of difference between ordering an entirely new aircraft type, and adding a few more on to the order 6 years later.

Not to criticise Ben Smith, I do think he's the right person to lead the group through this.
 
FlyingHonu001
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 5:55 pm

jfk777 wrote:
Air France could been very profitable when they merged but AF is hardly an airline with a huge profitable history. AF is known for its militant screw the company unions. They just had to bring in a Canadian to run AF because the relations were so poisonous between management and employees.

Here is an example of how poisonous it was :D
Source: https://youtu.be/CWu60917X9k
 
Jetty
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 6:16 pm

FlyingHonu001 wrote:
jfk777 wrote:
Air France could been very profitable when they merged but AF is hardly an airline with a huge profitable history. AF is known for its militant screw the company unions. They just had to bring in a Canadian to run AF because the relations were so poisonous between management and employees.

Here is an example of how poisonous it was :D
Source: https://youtu.be/CWu60917X9k

Savages :o Who would want unhinged people like that near the controls of an aircraft?

KLM largest strike in recent history for comparison: http://www.youtube.com/watch?v=_hteyu8w9xE
 
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ojjunior
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 6:24 pm

TUGMASTER wrote:
Slightly off topic, but touching on the apparent French willingness to do so.
As a seasoned non-rev traveller, the difference in flying KL to AF is absolutely astounding. KL staff always try and bend over backwards to help you out, to get you where toU need to go, whereas AF staff are the complete opposite, and really really make it known that they are doing you a favour.
Such a joy to fly KL,,, not so with AF.


Fully agreed.
However I believe this is not an AF vs KL comparison but a France vs Netherlands behaviour.
Been to both a lot, the difference is astonishing, not only onboard.
 
Nicknuzzii
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 6:30 pm

TWA772LR wrote:
DL will buy a stake in KL before IAG does. Skyteam cant afford to lose KL and DL has made it a point to invest in airlines to sway them away from others and they will fight until the bitter end for KL.


DL has no cash at all right now.
 
Jetty
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 6:38 pm

Nicknuzzii wrote:
TWA772LR wrote:
DL will buy a stake in KL before IAG does. Skyteam cant afford to lose KL and DL has made it a point to invest in airlines to sway them away from others and they will fight until the bitter end for KL.


DL has no cash at all right now.

They could do a share swap. With the financial backing of the Dutch government and given that KL was in good shape before Covid they don't need cash, just a strong partner.
 
Thibault973
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 7:04 pm

jfk777 wrote:
Thibault973 wrote:
jfk777 wrote:
Why KLM ever merged with Air France never made any sense, AF has always been the second worse run airline in Europe after Alitalia. KLM would fit very nicely in the IAG portfolio, especially with their 777 & 787 long haul fleets.


?? When KL merged with AF, KL was loss making while AF was the single most profitable airline in the world.


Air France could been very profitable when they merged but AF is hardly an airline with a huge profitable history. AF is known for its militant screw the company unions. They just had to bring in a Canadian to run AF because the relations were so poisonous between management and employees. How much did "profitable" AF just spend in the last ten years on A380 that likely aren't going to fly again. Hardly an example good management.

What wise decision did the Canadian do, order a whole bunch of A350-900, now that is a smart CEO ordering a plane they can fill and fly to Buenos Aires, Tokyo Haneda, San Francisco and Singapore.


Since you clearly know how to run an airline, I really advise you to apply for the position. Why not, just ask 20% of what Rigail is getting and you might have a shot. I'm rooting for you.
 
Thibault973
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 7:08 pm

Jetty wrote:
FlyingHonu001 wrote:
jfk777 wrote:
Air France could been very profitable when they merged but AF is hardly an airline with a huge profitable history. AF is known for its militant screw the company unions. They just had to bring in a Canadian to run AF because the relations were so poisonous between management and employees.

Here is an example of how poisonous it was :D
Source: https://youtu.be/CWu60917X9k

Savages :o Who would want unhinged people like that near the controls of an aircraft?

KLM largest strike in recent history for comparison: http://www.youtube.com/watch?v=_hteyu8w9xE


The man had just announced a 2900 jobs cut, I'd dare say that 1/2 a shirt is a small prizer to pay. As to those "savages", without them we'd still have a king, no pay leaves etc. etc. etc. Long live de French savages <3 <3
 
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American 767
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 7:18 pm

Then what would happen to Transavia? Would they remain a subsidiary of AF or KL? Probably KL. Because I believe that Transavia was Dutch originally. It's like when a mother and a father divorce, the child is kept in custody at the mother and is allowed to see the father a limited time only as per the judge decision.
Ben Soriano
 
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BN727227Ultra
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 7:18 pm

Nicknuzzii wrote:
TWA772LR wrote:
DL will buy a stake in KL before IAG does. Skyteam cant afford to lose KL and DL has made it a point to invest in airlines to sway them away from others and they will fight until the bitter end for KL.


DL has no cash at all right now.


I know this is an exercise, but how much does IAG have? More importantly, why do they?
 
SCQ83
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 7:21 pm

KLM would be a loser out of this. The local market in NL is much smaller than Paris/France. With the drop in traffic for the near future, I think "too big airlines in small countries" (KLM, Emirates, Cathay, etc) will suffer the most. Air France should break the alliance.

On the other hand, I can't see either the benefit for IAG. The Americas are perfectly covered and now with more space in LHR those Asian routes could be served by BA if there is any market.
 
Arion640
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 7:22 pm

petertenthije wrote:
Arion640 wrote:
On the contrary KLM operate 737’s which won’t fit well with IAG’s short haul fleet.
IAG has 200 737MAX's on order. Of course, these being MAX's, when these are to be delivered is anyone's guess. :)


I wouldn’t be surprised if they never get built!
 
onwFan
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 7:36 pm

PHBVF wrote:
The article specifically mentions that this move would mean the end of the holding company and a deep level of cooperation and coordination with AF would remain.
I would call speculating about the end of the holding company quite premature (but entertaining and in the spirit of this forum), however given the way this is presented speculation of take overs by BA/LH are a stretch too far (even if only because both those companies are currently fighting for survival)

Precisely my thoughts. The only danger I see in splitting is that they risk burning the already weak bridges for good. And that can be a hurdle in working together...
 
Thibault973
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 7:50 pm

American 767 wrote:
Then what would happen to Transavia? Would they remain a subsidiary of AF or KL? Probably KL. Because I believe that Transavia was Dutch originally. It's like when a mother and a father divorce, the child is kept in custody at the mother and is allowed to see the father a limited time only as per the judge decision.


HV and TO are two separate airlines with the latter being 95.51% owned by AF. and 4.49% by HV.
 
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usdcaguy
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 7:58 pm

However much Ben Smith may have wanted Elders out, I doubt this will happen. There are too many synergies between KL and AF, and the AF-KL JV with DL would need to be reassessed by the EU and the US. I just don't see anything happening in the near future, especially in light of the virus. AF-KL are already sharing the flying over AMS and CDG during the pulldown in capacity, and I think in the future we'll continue to see more of this as Smith pares down the AF network to a more profitable core. It's possible AF will be nationalized soon anyway.
 
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OA412
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 8:08 pm

Even if the holding company was dissolved, people seem to be overlooking how difficult it will be to unwind the JV KL already enjoys with DL. It won't be easy to wind that down, largely because DL probably wouldn't make it very easy for DL. Further, the partnership, first with NW, then with DL, has been incredibly successful. I don't know that KL would just walk away from that. That said, these are unprecedented times for the industry, and anything can happen.
Hughes Airwest - Top Banana In The West
 
Jetty
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 8:08 pm

usdcaguy wrote:
It's possible AF will be nationalized soon anyway.

If AF is nationalized KL will no longer be a part of it: KL being part of a government owned French company is unacceptable for all KL’s stakeholders.
 
AirwayBill
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 8:12 pm

usdcaguy wrote:
It's possible AF will be nationalized soon anyway.


Highly unlikely.


Jetty wrote:
If AF is nationalized KL will no longer be a part of it: KL being part of a government owned French company is unacceptable for all KL’s stakeholders.


They can be very touchy people indeed.
 
oldJoe
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Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 8:20 pm

SCQ83 wrote:
KLM would be a loser out of this. The local market in NL is much smaller than Paris/France. With the drop in traffic for the near future, I think "too big airlines in small countries" (KLM, Emirates, Cathay, etc) will suffer the most. Air France should break the alliance.

On the other hand, I can't see either the benefit for IAG. The Americas are perfectly covered and now with more space in LHR those Asian routes could be served by BA if there is any market.


When the local market in NL is much smaller then in France , why KLM made profits and AF were loosing money in the last couple of years ?
Ben Smith will not wipe out the French Unions or stear them in his direction which for me is the biggest problem in France.
KLM would be a bladerunner if they break the alliance. If this doesn`t work out well for them , guess what , they are toast.
 
marcelh
Posts: 1010
Joined: Wed Jun 19, 2013 12:43 pm

Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 8:23 pm

Jetty wrote:
usdcaguy wrote:
It's possible AF will be nationalized soon anyway.

If AF is nationalized KL will no longer be a part of it: KL being part of a government owned French company is unacceptable for all KL’s stakeholders.

The French government already owns about 14,3 percent of the AF-KL holding, so KLM is already partially owned by the French government...
 
sekant
Posts: 13
Joined: Fri May 19, 2017 10:07 am

Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 8:41 pm

ojjunior wrote:
TUGMASTER wrote:
Slightly off topic, but touching on the apparent French willingness to do so.
As a seasoned non-rev traveller, the difference in flying KL to AF is absolutely astounding. KL staff always try and bend over backwards to help you out, to get you where toU need to go, whereas AF staff are the complete opposite, and really really make it known that they are doing you a favour.
Such a joy to fly KL,,, not so with AF.


Fully agreed.
However I believe this is not an AF vs KL comparison but a France vs Netherlands behaviour.
Been to both a lot, the difference is astonishing, not only onboard.


I travel extensively for work, meaning business class, the difference between KLM and Air France is a difference between night (KLM) and day (Air France), from food to staff attitude to lounges, ....

One other point, if KLM think that being in bed with Air France is such a drag, then pull the plug already ... because that constant whining is getting more than tiresome, especially considering how Air France helped KLM out of the hole it was in, how the AF-KLM group enabled KLM to expand, ....
 
sekant
Posts: 13
Joined: Fri May 19, 2017 10:07 am

Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 8:42 pm

marcelh wrote:
Jetty wrote:
usdcaguy wrote:
It's possible AF will be nationalized soon anyway.

If AF is nationalized KL will no longer be a part of it: KL being part of a government owned French company is unacceptable for all KL’s stakeholders.

The French government already owns about 14,3 percent of the AF-KL holding, so KLM is already partially owned by the French government...


Whereas the Dutch government own 14 percent... Go figure...
 
marcelh
Posts: 1010
Joined: Wed Jun 19, 2013 12:43 pm

Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 8:52 pm

sekant wrote:
marcelh wrote:
Jetty wrote:
If AF is nationalized KL will no longer be a part of it: KL being part of a government owned French company is unacceptable for all KL’s stakeholders.

The French government already owns about 14,3 percent of the AF-KL holding, so KLM is already partially owned by the French government...


Whereas the Dutch government own 14 percent... Go figure...

And both French and Dutch government are working very close together for the bail-out. I don’t think the Dutch government is willing to trash 2-4 billion Euro of taxpayers money...
 
Amsterdam
Posts: 449
Joined: Thu Mar 17, 2011 12:52 am

Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 8:54 pm

The solution is super simple.
Meaningful restructuring and cost lowering at AF. Then everything will be ok.

So not just scraping an x amount of jobs but leaving all the other jobs expensive.
I dont think they will do it.
 
Amsterdam
Posts: 449
Joined: Thu Mar 17, 2011 12:52 am

Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 8:56 pm

marcelh wrote:
sekant wrote:
marcelh wrote:
The French government already owns about 14,3 percent of the AF-KL holding, so KLM is already partially owned by the French government...


Whereas the Dutch government own 14 percent... Go figure...

And both French and Dutch government are working very close together for the bail-out. I don’t think the Dutch government is willing to trash 2-4 billion Euro of taxpayers money...


A part of that is a bank guarantee not loan.
All of it is for KLM.
How will that money be trashed if KLM leaves the holding and keeps deep cooperation with AF and Delta for instance?
 
marcelh
Posts: 1010
Joined: Wed Jun 19, 2013 12:43 pm

Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 9:00 pm

sekant wrote:
ojjunior wrote:
TUGMASTER wrote:
Slightly off topic, but touching on the apparent French willingness to do so.
As a seasoned non-rev traveller, the difference in flying KL to AF is absolutely astounding. KL staff always try and bend over backwards to help you out, to get you where toU need to go, whereas AF staff are the complete opposite, and really really make it known that they are doing you a favour.
Such a joy to fly KL,,, not so with AF.


Fully agreed.
However I believe this is not an AF vs KL comparison but a France vs Netherlands behaviour.
Been to both a lot, the difference is astonishing, not only onboard.


I travel extensively for work, meaning business class, the difference between KLM and Air France is a difference between night (KLM) and day (Air France), from food to staff attitude to lounges, ....

One other point, if KLM think that being in bed with Air France is such a drag, then pull the plug already ... because that constant whining is getting more than tiresome, especially considering how Air France helped KLM out of the hole it was in, how the AF-KLM group enabled KLM to expand, ....

There is a persistent group in the Netherlands who has the opinion that KLM is better of without AF. KLM may have performed better than AF in some recent years, but without AF KLM wouldn’t be as successful as it is nowadays. Probably they exist as “British Airways Europe” or as “EuroWings NL”
 
Waterbomber2
Posts: 1207
Joined: Mon Feb 04, 2019 3:44 am

Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 9:06 pm

I wrote this a couple of months earlier, but what will happen is that AF will get a proper bailout and KL won't or KL's bailout will not be accepted because the Dutch government will ask too many conditions or will be too small.
The French will grow tired of the Dutch's nagging and will dictate the conditions, but the Dutch will suddenly issue new shares to the government, diluting AF-KLM's shreholding.
It will take some time but this is IMO the beginning of the end for this tie-up.

KLM could end up being a stand-alone for a while, remaining partners with DL and perhaps even seeking some weird partnerships.
There will be interest for a tie-up with IAG but I don't think that the British will be very fond of that and they will be busy with whatever happens in the UK market after this.

AF and France are too important for DL, but DL won't have the global influence it had pre-Covid-19.

KLM will try to grow but after sevral years, their financial performance is going to be set back and the downsizing will begin.

Again, a lot of moving pieces but I see it playing out somewhat like that.


With the EU suspending competition rules, we are going to see many governments getting involved in airlines again and we may see the break up of alliances and fragmentation of the market, just like in the old days. The EU seems to have taken a backseat approach in all of this by botching the response on Covid-19. Member states stepped up and we don't hear anything coming out of the EU anymore.
Last edited by Waterbomber2 on Mon Apr 27, 2020 9:12 pm, edited 1 time in total.
 
marcelh
Posts: 1010
Joined: Wed Jun 19, 2013 12:43 pm

Re: KL Takes Into Account Possibility of AFKL Breakup

Mon Apr 27, 2020 9:11 pm

Amsterdam wrote:
marcelh wrote:
sekant wrote:

Whereas the Dutch government own 14 percent... Go figure...

And both French and Dutch government are working very close together for the bail-out. I don’t think the Dutch government is willing to trash 2-4 billion Euro of taxpayers money...


A part of that is a bank guarantee not loan.
All of it is for KLM.
How will that money be trashed if KLM leaves the holding and keeps deep cooperation with AF and Delta for instance?

That “deep corporation” isn’t defined at all. And it will give more uncertainty and added costs to unwind the current structure to that unicornish “deep corporation”, which will be a “deep distrust”. A nice starting point to burn money and weaken the company instead of strengthen it. And is a weak company able to pay back those loans? And that bank guarantee is to cover a loan from banks to KLM. If KLM can’t pay it back, those banks will come to the government to collect their money.

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