Air France-KLM ground entire A380, B747 planes, cuts capacity

Faced with these growing restrictions on the possibility of travelling and a strong downward trend in demand which has resulted in a drop in traffic and sales over the last few weeks, the Air France-KLM said it has been forced to reduce capacity scheduled to last for two months.

As a result of the reduction in capacity, Air France disclosed that it had concluded time to ground its entire Airbus 380 fleet and KLM its entire Boeing 747 fleet.

To deal with this situation, the Group has already taken a number of strong measures to secure its cash flow such as it said additional savings measures had been identified, which will generate €200 million in 2020.

It stated that an initial review of the investment plan had reduced the capital expenditure plan by €350 million, to which will be added the impact of the decline in activity on the amount of maintenance investments.

Air France and KLM will be consulting with their elected employee representatives.

In spite of the measures taken, the deterioration of the environment linked to the epidemic and the sharp reduction in its activity that has resulted today lead the group to forecast a sharply deteriorated financial trajectory compared to the outlook presented at the publication of its annual results.

Indeed, the Group estimates that the drop in revenues from the Passenger business resulting from the reduction in capacity will only be offset by around 50% by the drop in variable costs before cost savings measures.

In this extremely difficult context, the Air France-KLM Group has welcomed the statements made by the French and Dutch governments, which have each indicated that they were studying all possible means to support the Group

Wole Shadare