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mercure1
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Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 6:27 am

Air France invited its union councils to a joint meeting on January 15th in attempt to share future plans.

Much of the reason for the meetings was attempt by management to produce improved social atmposhere with its staff.

The company offered unions an opportunity for revised recovery plan under its "Perform 2020" program. This plan is virtually a total 180 degree change in direction from previous plans (threats) the company made.

Some highlights were:

o Cancellations of thread of 3,000 compulsory redundancies by 2017. Instead management will commit to only voluntary staff count changes
o AF longhaul fleet will no longer decline. Instead of reduction of planned 7 net frames, fleet will actually grow by 5 frames to 109 craft by 2020. Net change of 12 frames.
o Confirmed induction of B787 and A350 craft starting in 2017.
o 1 or 2 new longhaul routes launched annually effective 2017
o Transavia France operation and fleet stabilized at max 40 frames by 2020
o Available flight hours for staff will increase by 10% by 2020.

This revised plan will be conditional however in negotiations with staff. AF request new collective agreement with air hostess be achieved by October 2016 and pilots by 2017.

If this plan is favorably received by staff company also agrees to commence incentive bonus payments to staff as soon as 2016.


http://www.air-journal.fr/2016-01-16...s-dun-plan-de-relance-5156607.html

It seems to me like a joke that company now has basically entirely changed its arguments. The carrot and stick approach now has returned to trying to use the carrot instead. No wonder many staff have lost confidence in management team as they zig-zag course all the time.

Of course devil is in details and it will matter very much to see what company desires from cabin crew and pilots in proposed upcoming talks.

[Edited 2016-01-17 22:32:35]
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MaverickM11
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 7:29 am

Quoting mercure1 (Thread starter):
The carrot and stick approach now has returned to trying to use the carrot instead. No wonder many staff have lost confidence in management team as they zig-zag course all the time.

What number turn around plan is this? The 5th?
E pur si muove -Galileo
 
mozart
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 7:52 am

Quoting mercure1 (Thread starter):
Much of the reason for the meetings was attempt by management to produce improved social atmposhere with its staff.

And exactly that is the problem.

Of course there is nothing wrong with having good labour relations, quite on the contrary. But it's ludicrous to run a company to please employees instead of balancing shareholder expectations, competitive environment, market dynamics, the financial situation of the company, etc.

AF has in effect given away any room for manoeuvring, and I am sure some union members feel that undressing company executives is a great way to get what they want.

I applauded the AF management for a number of things that they have done over the past 1-2 years. Some changes were very good on the product end and certainly brought some passengers back (not enough though, but that is a different story). But the way they run the overall shop, with zig-zag direction and communication - completely amateurish. Employees - rightly - say that management doesn't have a clear course, and investors, too, must lose confidence.

What a pity. This could be and SHOULD be such a great company. But it's a pathetic show, run by amateurs for the benefit of its employees who share only a fraction of the entrepreneurial risk.
 
scotron11
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 9:11 am

Quoting mozart (Reply 2):
AF has in effect given away any room for manoeuvring, and I am sure some union members feel that undressing company executives is a great way to get what they want.

Yup...seems there has not been any harmony for quite some time now....meanwhile competitors keep passing them by. IAG is now ranked 2nd in Europe......and is closing in on AF/KLM fast!
 
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LAXintl
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 4:20 pm

Funny stuff.

Basically AF is telling unions we largely agree with your demands, just maybe ease up on them a little and we can all live happily ever after.

Good news that B787 and A350s are confirmed. Company had threatened to scuttle 787 order entirely just few months ago.
Also maximum fleet size of Transavia France at 40 frames seems reasonable compromise.
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STT757
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 4:35 pm

What about taking back some of the routes they've turned over to DL, like CDG-EWR.
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DolphinAir747
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 4:43 pm

Quoting LAXintl (Reply 4):
Basically AF is telling unions we largely agree with your demands, just maybe ease up on them a little and we can all live happily ever after.

Probably the only way to keep the company afloat if labor-management relations are that toxic no?
 
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euroflyer
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 4:49 pm

Looks like I should also snatch his shirt from my HR to get my pay hike !
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mercure1
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 5:20 pm

Quoting STT757 (Reply 5):
What about taking back some of the routes they've turned over to DL, like CDG-EWR.

Its not a matter of taking back anything. Technically AF still serves CDG-EWR. Under the Atlantic joint-venture everything is shared and capacity decisions are made jointly. Who has what free aircraft etc. Makes no difference who airline operator is internally.

I suspect future growth will be to strengthen markets like Asia, and maybe South America as well.
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ATLFlyer323
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 5:20 pm

Quoting STT757 (Reply 5):
What about taking back some of the routes they've turned over to DL, like CDG-EWR.

Isn't this more about who has the frames and operating costs to most profitably operate the route vs. who is flying it since they share the profits or losses anyways? I could be 100% wrong of course.

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MaverickM11
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 6:32 pm

Quoting mercure1 (Reply 8):
Its not a matter of taking back anything. Technically AF still serves CDG-EWR. Under the Atlantic joint-venture everything is shared and capacity decisions are made jointly. Who has what free aircraft etc. Makes no difference who airline operator is internally.

Not quite. In theory yes they are metal neutral and it shouldn't matter who sells what; in practice no. These are all stopgap measures as the alternative to DL flying these routes would be no service, or losing more money on AF equipment.

Quoting ATLFlyer323 (Reply 9):
Isn't this more about who has the frames and operating costs to most profitably operate the route vs. who is flying it since they share the profits or losses anyways?

Yes, but things like CDGEWR, where DL has little presence on both ends in terms of its own metal, should be on AF metal, all things being equal.
E pur si muove -Galileo
 
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LAX772LR
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 7:36 pm

Quoting STT757 (Reply 5):
What about taking back some of the routes they've turned over to DL, like CDG-EWR.

The J/V agreements are give and take... if they take back that (or really, any) route, they have to equalize the capacity in DL's favor elsewhere.
I myself, suspect a more prosaic motive... ~Thranduil
 
blueflyer
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 9:11 pm

Quoting mozart (Reply 2):
I am sure some union members feel that undressing company executives is a great way to get what they want.

As long as the members find a few employees ready to risk it all as this seems to be the one issue management is unwilling to cave on so far. 5 former employees are still set to be tried in May, and at least one pilot has been terminated for giving them access to the secure area where the executive was first attacked.

A couple of smaller unions threatened to strike if the company didn't withdraw its complaint, to no avail.
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delimit
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 9:41 pm

Quoting MaverickM11 (Reply 10):

Yes, but things like CDGEWR, where DL has little presence on both ends in terms of its own metal, should be on AF metal, all things being equal.

Why? It's a JV.
 
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PW100
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 9:44 pm

Quoting mercure1 (Reply 8):
Its not a matter of taking back anything. Technically AF still serves CDG-EWR
Quoting mercure1 (Reply 8):
Makes no difference who airline operator is internally.
Quoting ATLFlyer323 (Reply 9):
Isn't this more about who has the frames and operating costs to most profitably operate the route vs. who is flying it since they share the profits or losses anyways?

I suspect that French unions might have a somewhat different view on that.
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 9:49 pm

Quoting PW100 (Reply 14):
I suspect that French unions might have a somewhat different view on that.

Or DL's. Is DL still technically out of compliance with their pilots or has that issue been resolved?
 
kl838
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 9:50 pm

AF management have just disappointed me, the airline needs to rip the bandaid off and do the deep cuts that are needed. The hold that the unions have over the airline are only going to continue now. The airline is going in an endless cycle, if management can't do their job because of the backlash of their employees how is the airline supposed to run profitably and look to the future. Transavia France needs to expand to steal business from Ryanair and Easyjet eating at AF - KL's feet, and to at least have the funds remain within the group.
 
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LAXintl
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 10:12 pm

Quoting DolphinAir747 (Reply 6):
Probably the only way to keep the company afloat if labor-management relations are that toxic no?

Pragmatic yes. Afloat I don't know. Long term just kicking the can down the road is probably not the best path for AF.

So yes management probably was being pragmatic and wanted to keep their shirts figuring they don't want all out war against labor so lets hand out more carrots and put away the sticks, but will this approach only make the problem bigger in 2, 5 or 10 years?? Time will tell.
From the desert to the sea, to all of Southern California
 
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mercure1
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 10:15 pm

Quoting PW100 (Reply 14):
I suspect that French unions might have a somewhat different view on that.

I dont see why.

Under JV AF is guaranteed a minimum level of flying. Matter of fact AF to the USA is bigger now then ever before. One can argue only thanks to the JV have AF been able to grow so large to US something it could not achieve on its own.

I see JV as being very beneficial to AF (and DL) and have not heard of unions seriously oppose it.
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DolphinAir747
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 10:37 pm

Quoting MaverickM11 (Reply 10):
Yes, but things like CDGEWR, where DL has little presence on both ends in terms of its own metal, should be on AF metal, all things being equal.

It's a question of aircraft availability. DL has 752s and 763s which can cover smaller markets, plus DL has a more consistent J product (AF is a lottery, its new 777 J is quite nice but they still send the old angled J even to competitive markets like B0). I used to take the AF 332 from CDG to EWR or PHL all the time, but they have really shrunk their presence in this market. The competition from UA, EC, and now B0 on EWR-PAR can't be helping them.
 
fiddlerkrt
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 10:42 pm

mercure1, you seem to be very knowledgeable about AF's operations. It seems to me that the number of mainline departures at CDG has fallen quite a bit over the last few years from around 340ish to around 240ish. Are these numbers at all correct and, if not, do you know where I might get more reliable statistics? Please correct me if I am wrong, but it seems that AF has reduced the number of A32x flights from CDG over the last few years while ORY has remained roughly the same.

Despite these cutbacks (which could just be my imagination), AF really does seem to be struggling disproportionately in comparison to LH while IAG has gone through the painful restructuring processes with both BA and IB.
 
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mercure1
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RE: Air France Lays Out Revised Recovery Plans

Mon Jan 18, 2016 11:15 pm

Quoting fiddlerkrt (Reply 20):

mercure1, you seem to be very knowledgeable about AF's operations. It seems to me that the number of mainline departures at CDG has fallen quite a bit over the last few years from around 340ish to around 240ish. Are these numbers at all correct and, if not, do you know where I might get more reliable statistics? Please correct me if I am wrong, but it seems that AF has reduced the number of A32x flights from CDG over the last few years while ORY has remained roughly the same.

Maybe there is confusion of what is classified as mainline versus all the regional partners flights?

AF mainline at moment has 220-240 daily departures at CDG. AF has actually grown at CDG with number of passenger enplaned, so I have not noted such decrease from 340 to 240 flights you mention.
AF also has increased hub banks from 4 to 6 longhaul waves and increased connection opportunities from like 14,000 to 25,000 combinations since 2007.
Actually they say CDG is #1 airport for connection opportunity and dwarf FRA schedule.
http://thedesignair.net/2016/01/02/a...ss-as-europes-largest-transit-hub/
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xdlx
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RE: Air France Lays Out Revised Recovery Plans

Tue Jan 19, 2016 12:11 am

Quoting mercure1 (Reply 21):

It very well could be but CDG is not connection friendly. Layout is not conducive for a connecting hub.
 
Amsterdam
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RE: Air France Lays Out Revised Recovery Plans

Tue Jan 19, 2016 12:22 am

What a joke. The management gave up. If fuel prices start rising they will be in big trouble again.
And max 40 aircraft for Transavia France in 2020 is not even +5 a year.
Transform 2015 was not completed.
And Perform 2020 also will not be completed because the changes were planned to go in effect 1 january 2016 which has already passed. And now the new agreements need to be made at the end of this year, another full year lost.
 
fiddlerkrt
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RE: Air France Lays Out Revised Recovery Plans

Tue Jan 19, 2016 12:23 am

Quoting mercure1 (Reply 21):
Maybe there is confusion of what is classified as mainline versus all the regional partners flights?

I think you are probably right and that I was combining mainline flights with regional flights and mixing up numbers. Thank-you for the information.
 
IPFreely
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RE: Air France Lays Out Revised Recovery Plans

Tue Jan 19, 2016 1:29 am

Quoting mercure1 (Thread starter):
Air France invited its union councils to a joint meeting on January 15th in attempt to share future plans.

I hope they invited plenty of security guards and have an ample supply of teargas on hand.
 
Lufthansa
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RE: Air France Lays Out Revised Recovery Plans

Tue Jan 19, 2016 2:35 am

Quoting Amsterdam (Reply 23):
And Perform 2020 also will not be completed because the changes were planned to go in effect 1 january 2016 which has already passed. And now the new agreements need to be made at the end of this year, another full year lost.

Lucky all that hard work and Euro's earned in AMS can be 'redeployed' elsewhere....
 
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lightsaber
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RE: Air France Lays Out Revised Recovery Plans

Tue Jan 19, 2016 2:37 am

This doesn't strike me as a recovery plan. This strikes me as appeasement.

AF needs serious restructuring. No one wants to cut jobs. But compared to TK, I just don't see how AF is ready for the next decade.

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YULWinterSkies
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RE: Air France Lays Out Revised Recovery Plans

Tue Jan 19, 2016 3:40 am

Quoting MaverickM11 (Reply 10):
Yes, but things like CDGEWR, where DL has little presence on both ends in terms of its own metal, should be on AF metal, all things being equal.

CDG acts as one big hub for DL, very much like NRT and AMS do. They can and do dispatch incoming aircraft in CDG back to a different US destination.

Quote:
=xdlx,reply=22]It very well could be but CDG is not connection friendly. Layout is not conducive for a connecting hub.

That all depends. From Europe (most of which lands at 2F) to international, it is extremely connection-friendly. The other way around is dependent on long immigration lines.
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MaverickM11
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RE: Air France Lays Out Revised Recovery Plans

Tue Jan 19, 2016 4:21 am

Quoting DolphinAir747 (Reply 19):
It's a question of aircraft availability.

Well yes, in the sense that if the 767 or 752 wasn't flying it, AF would be out of the market

Quoting YULWinterSkies (Reply 28):
CDG acts as one big hub for DL, very much like NRT and AMS do. They can and do dispatch incoming aircraft in CDG back to a different US destination.

Hence why I said...

Quoting MaverickM11 (Reply 10):
in terms of its own metal
Quoting YULWinterSkies (Reply 28):
That all depends. From Europe (most of which lands at 2F) to international, it is extremely connection-friendly. The other way around is dependent on long immigration lines.

It's totally conducive to a connecting hub. The execution however, is spectacularly awful. I don't understand how every time I use T1 I get a gate; any time I arrive/depart from any of the beautiful, new, empty AF concourses, it's a ramp load.

Quoting mercure1 (Reply 21):
Actually they say CDG is #1 airport for connection opportunity and dwarf FRA schedule.

Four parallel runways, excellent new terminals, huge local demand--it has all the ingredients to really be a great hub. Shame about the execution though...
E pur si muove -Galileo
 
Aither
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RE: Air France Lays Out Revised Recovery Plans

Tue Jan 19, 2016 5:48 am

Many people on A.net think like shareholders. Shareholders driving the western companies bankrupt.
To make profits, the number one objective should be to increase revenues, the number two should be to reduce costs. Unfortunately many companies are doing the opposite. Fighting on costs is a battle you can only lose against ME4 or Chinese airlines.
Never trust the obvious
 
Egerton
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RE: Air France Lays Out Revised Recovery Plans

Tue Jan 19, 2016 10:21 am

Quoting lightsaber (Reply 27):
AF needs serious restructuring

It was polite of you not to use the term "cheese eating surrender monkeys" in respect of the management.
Given instructions to surrender by the French government, the top management would have been better to resign.
 
r2rho
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RE: Air France Lays Out Revised Recovery Plans

Wed Jan 20, 2016 1:29 pm

Quoting xdlx (Reply 22):
It very well could be but CDG is not connection friendly. Layout is not conducive for a connecting hub.

It's possible that you haven't been to CDG in the past 1-2 years, in which case I fully agree. But the recent consolidation of EU ops in 2F (no more walking to 2D outside security) and the E-F connecting tunnel have improved things a lot. Also, the new baggage sorting facility seems to have improved the lost bags issue for which CDG is notorious. Now the only non-connected terminal is 2G, which remains a terminal to avoid.

Nevetheless, it is true that with the exception of the satellites, CDG terminals were originally built more for O&D than connections, and the necessary modifications were made as an afterthought. AF has suffered from this ackward layout for many years.
 
Bongodog1964
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RE: Air France Lays Out Revised Recovery Plans

Wed Jan 20, 2016 2:04 pm

Quoting Amsterdam (Reply 23):
What a joke. The management gave up. If fuel prices start rising they will be in big trouble again.

I think this is the basis of the decision, "fuel prices are dropping, so we don't need to achieve the savings we first envisaged". The problem with this muddled thinking is that AF's operating costs will continue to be far above their competitors. The competition will be able to price lower and still make their profits.

Quoting Aither (Reply 30):
Many people on A.net think like shareholders. Shareholders driving the western companies bankrupt.
To make profits, the number one objective should be to increase revenues, the number two should be to reduce costs. Unfortunately many companies are doing the opposite.

Whilst it is true that increased revenue should result in better economies of scale, you would do well to remember the following:


Turnover is vanity, profit is sanity v   

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