Setting out what he called a "final proposal", Alexandre de Juniac
told Le Monde daily the aim was to buy time for detailed
negotiations with pilot representatives on the plan.
"We are proposing to suspend until the end of the year the project
to create Transavia units in Europe outside France and the
Netherlands. That will create time to carry out a thorough dialogue
on the plan and to formulate the necessary guarantees with unions,"
But he stressed: "This arrangement must not call into question our
ambition to develop Transavia, which is one of the key sources of
growth for the Air France-KLM group".
De Juniac said the strike was "disastrous" for the group, battling
to fight off competition from low-cost rivals.
No one from the pilots' unions was available for comment. De Juniac
and Frédéric Gagey, head of Air France, were due to give a news
conference at 2:00 pm Paris time (8:00 a.m. EDT).
At 5:43 a.m. EDT, Air France shares were 1.55 percent lower at 7.935
euros after having shed up to three percent early on.
The strike over the airline's plans to establish low-cost activities
outside France is entering its second week and set to be the longest
such industrial action in its history. The main SNPL union has
extended strike action to Sept. 26 and a second union, SPAF, to
Sept. 24 with an option to extend further.
Earlier, the French government made a renewed appeal for a quick end
to the strike and urged management to "clarify" their proposals.
"Service must resume now," Jean-Marie Le Guen, minister in charge of
relations with parliament, said ahead of the latest round of talks
due on Monday between unions and management.
"Very quickly, the management must make a certain number of
clarifications on their proposals," he added.
[to top of second column]
The expansion of Transavia is part of a new plan unveiled this month
aimed at boosting earnings. The proposals would see Transavia's
fleet rise to 100 jets by 2017, from about 50 now, and the number of
passengers more than double to 20 million.
Air France, part of Air France-KLM, expects 41 percent of its
flights to operate on Monday. SNPL said ahead of Monday's talks that
negotiations reached "a complete impasse".
The industrial action began on Sept. 15, and Air France estimates it
is costing the company 10 million to 15 million euros ($13-19
million) a day, implying the cost of the walkout could rise to as
much as 180 million euros by Sept. 26.
Air France-KLM is currently expected to post 2014 earnings before
interest, tax, depreciation and amortization (EBITDA) of 2.28
billion euros and pre-tax profit of 79 million, according to the
average of analysts' estimates on Thomson Reuters Eikon.
Transavia posted a 64 million euro operating loss in the first six
months of this year, 10 million more than a year earlier due mainly
to the ramp-up of Transavia France. Passenger traffic rose 6.9
(Reporting by Mark John and Maya Nikolaeva; Editing by Brian Love
and Alexandria Sage)
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