How is Air France dealing with the crisis? We see a lot of problems in the industry these days, what is the recipe for success in changing global conditions?
Indeed the many natural, financial and political crises around the world have had a strong impact on our industry. In this increasingly uncertain global economic environment, compounded by oil prices and exchange rate volatility, an improvement in our productivity and costs is necessary.
Air France-KLM have launched a recovery plan where both airlines are implementing transformation measures to ensure a rapid return to stability for the group. The Air France’s strategic business project called “Transform 2015” was launched last May and aims to restore our competitiveness, cut costs, reduce debt and launch a restructuring plan for our medium-haul network to reverse the trend and put us back on the road to recovery. For the transformation to be a complete success, Air France has begun renovating its organisation with the view to making it simpler, more responsive and fully focused on the customer.
Nevertheless the company will continue investing to guarantee all our passengers even more efficiency, fluidity and quality of service. For example, new resources will be mobilised to place mobile services and online sales at the heart of the commercial relationship, with a targeted objective of EUR 3bn – EUR 3.5bn of online sales in 2015, compared with EUR 2bn in 2011. Furthermore, to offer our customers airport services among the best in the world, Air France in cooperation with Aéroport de Paris, inaugurated last June a new embarkation haul within the S Terminal exclusively dedicated to Air France-KLM and Sky Team partners. The Boarding Hall M in S Terminal and the largest ever Air France Business Class Lounge marks a turning point in the history of our hub. The Business Class lounge, designed by Brandimage in cooperation with designer Noé Duchaufour-Lawrance and inspired by a park, aims to provide a relaxing and peaceful experience.
Where is Air France better than the competition? Why should someone fly with you and use your services?
There are many reasons: we have the largest long-haul network of Europe, covering 230 destinations in 113 countries worldwide; our fleet is made up of 586 modern aircraft (average age of the fleet is 10.4 years); we benefit from the power of our two hubs – Paris Charles de Gaulle and Amsterdam Schiphol, which are the number one and two hubs in Europe in term of traffic volume; we profit from a powerful transatlantic joint-venture with Delta Air Lines and Alitalia, offering 250 transatlantic flights per day; and we continue investing in our online services to supply the easiest and most relaxing journey for our customers. As an example, the “Air France and KLM Connect” service enables customers to be informed throughout their trip of any flight modifications, change of boarding gate, delays or delayed baggage delivery. We keep improving our in-flight service following customer needs and wishes: more spacious, “full sleep” seats on long-haul Air France and KLM business class cabins; brand new B777-300 modern aircraft flying the Caribbean routes; seven routes operated with the new A380 aircraft (Johannesburg, Los Angeles, Montreal, New York-JFK, Singapore, Tokyo-Narita and Washington DC); and à la carte meals on board.
We continue improving our ground service allowing passengers to quicken and make easier their transit. Some examples: the Sky Priority access permitting Elite Flying Blue members and business passengers to use fast track dedicated lines at check-in, boarding, police control, etc.; a new cabin, Premium Voyageur, located between Business and Economy (distinguishing this new class is the comfort of a private space and a fixed-shell seat offering 40% more room than the seats in Voyageur (Economy) class); Europe’s leading frequent flyer programme, FlyingBlue, with miles remaining valid for life providing that customers travel once every two months; our La Premiere offer, an unforgettable journey in luxury; the Sky Team Alliance made up of 18 members offering 926 destinations and 14,500 daily flights worldwide.
How are you competing with low cost companies, where the price of air travel before they entered the market were over the normal level and existing companies had large extra profits, where did this money go?
The service offered by Air France-KLM is not comparable with low cost. Our prices includes 23kg of registered baggage, meals and/or refreshments on board, a full range of ground and on board services and the assistance of our staff at departure, arrival and in-transit. The staff costs and working hours of a regular airline are not equivalent with those of a low cost airline.
Nevertheless, to better meet the changing expectations of travellers seeking greater simplicity and clarity and more affordable fares, in 2010 Air France launched a new medium-haul offer.
The essentials of the Air France service remain, but the airline offers two separate economy cabins, the “Voyageur” and the “Premium”. The Voyageur offer is designed for customers looking for a simple, inexpensive product with all the essentials of the Air France service.
The Premium offer is tailored to the requirements of business travellers seeking more flexibility, enhanced service, even greater efficiency and time-saving, at more affordable prices. Premium customers have a choice between two products: the Premium Eco for those seeking flexibility and efficiency at the best prices and Premium Business for those who opt for more comfort and privacy.
Every company is trying to present some new products and services in different segments of the market – you introduced BlueBiz service for business people, what do you offer to that segment and what are your advantages in comparison to other companies?
Air France-KLM and Delta have combined their efforts to offer small and medium enterprises an easy-to-use Corporate Benefits programme enabling them to make additional savings on their travel budget while using the extended network of the three airlines. The main advantages of BlueBiz are: transparency – for each trip made by employees of the company, the company earns Blue Credits (1 Blue Credit = 1 euro). The Blue Credits the company earns on each flight depends on the destination and class of travel, a win-win situation – while the company earns Blue Credits, employee members of the frequent flyer programmes, Flying Blue and Millemiglia, continue earning their miles. Blue Credits have a long life – they are valid for up to three years; ease – the BlueBiz account can be easily managed online on www.airfrance.si, www.klm.com or www.delta.com; customer recognition – the traveller can benefit from an innovative corporate recognition system, throughout their journey their habits and preferences will be taken into consideration thus ensuring a smooth and hassle-free journey.
What is your prediction for the air travel market in 2013?
Recent years have been dominated by natural disasters, uprisings in the Middle East, the eurozone crisis and oil price volatility. I think that in 2013 we will see the implementation of restructuring plans for many major airlines and a general restructuring of medium-haul traffic. But 2013 will also bring with it innovative services, mostly due to the use of new technology. Air France-KLM will start offering in-flight internet and data communication which will enable customers to stay connected with text messages or emails as well as an internet connection and ultimately live broadcasts of TV programmes. On the specially designed in-flight website, a broad range of services will be offered for free, like the latest news, TV, relevant airline and destination information and a unique offer of online magazines. The trial phase will be conducted on two Boeing 777-300s operated by each airline. During this period, travellers will be able to hook up to the internet via their Wi-Fi enabled smartphone, laptop or tablet PC at a fixed rate, as well as use their mobile phone for SMS or email, whatever their travel class. Generally speaking I hope for a better future and recovery for the entire industry.