PARIS (Reuters) - French airline Air France announced 2,800 fresh job cuts on Wednesday to help cope with weak air travel demand as it heads towards its sixth consecutive annual operating loss.
The carrier said it would no longer reach its target to break even this year, but said it was “imperative” to achieve that in 2014.
“We are in a period of weak demand,” Chief Executive Frederic Gagey told a news conference. “We have felt the full brunt of the cyclicality of air transport.”
Air France, part of Franco-Dutch group Air France-KLM (AIRF.PA), said it would begin negotiations with staff representatives from October 4 on new voluntary departure plans to cut an expected staff surplus for next year.
Air France has been hurt by the impact of Europe’s economic woes on demand for air travel, soaring fuel costs, and aggressive competition from low-cost carriers in the region and Gulf carriers on long-haul routes.
The head of rival IAG (ICAG.L), parent of British Airways and Spain’s Iberia, Willie Walsh, said on Tuesday that European airlines would have to cut costs at their short-haul businesses to compete with budget airlines or struggle to stay aloft.
Traditional network carriers are cutting jobs, renegotiating staff contracts and dropping uncompetitive routes.
Air France is already cutting around 5,120 out of 49,300 staff on French contracts by the end of 2013 as part of plans unveiled in June last year.
Air France added on Wednesday that it would further reduce capacity on French point-to-point routes out of Paris Orly airport and in its regional bases, while it would develop its Transavia European unit.
The carrier also said it would retire its Boeing (BA.N) 747 freighters from its cargo fleet by 2015. It will stop flying the jumbo aircraft on passenger services in parallel.
Reporting by Matthias Blamont; Editing by Leila Abboud and Tim Hepher