September 18, 2013 - 18:27 AMT
PanARMENIAN.Net - French carrier Air France has said it plans to cut a further 2,800 jobs through voluntary redundancy as it struggles to cut costs, BBC News reported.
The airline, part of the Air France KLM group, had already announced plans to cut 5,100 jobs from its 69,000-strong workforce as part of a turnaround plan. But it has now admitted it will miss its financial targets for 2013.
Air France said it was in negotiations with unions regarding the latest planned cuts.
The airline merged with Dutch carrier KLM in 2004.
European airlines have been hit by low growth in passenger numbers and high fuel costs, while older "flag carrier" airlines are also struggling to compete with low-cost carriers such as Easyjet and Ryanair.
"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."
Shares in Air France KLM fell more than 3% in response to the news.
In a statement, Air France said it would continue a policy of "wage moderation" alongside the job cuts.
According to centreforaviation.com, in Q2 2013, Air France-KLM grew its revenues by 1.2% to euro 6,580 million and turned around from an operating loss of euro 79 million last year to an operating profit of euro 79 million this year, an improvement of euro 158 million. This led to a narrower operating loss for H1 2013 of euro 451 million versus a loss of euro 690 million last year, an improvement of euro 239 million.
This was the group’s first profitable second quarter in five years, but much of the improvement in the operating result can be attributed to lower fuel costs, which fell by euro 146 million in Q2 and by euro 160 million in H1, reflecting lower prices for jet fuel.