Air France-KLM will launch budget airline for long-haul flights to Asia
IN late 2017, you’ll be able to fly to Europe via a new budget airline by Air France-KLM. The Franco-Dutch airline announced that it’ll be rolling out a new long-haul budget service to service Asia as well as the US.
The Wall Street Journal (WSJ) reported that the new airline would take over some of the least profitable Air France services and will operate them with staff on lower salaries.
The airline would hire Air France pilots who would fly more hours but operate on the same salary and enjoy less benefits. The service would also be less lavish compared to the standard passengers typically get on Air France routes.
The move comes as both airlines continuously try to fight competition from budget carriers in “ultra-competitive markets” like Asia.
According to Reuters, the new airline will include economy and business class flights with amenities like lie-flat seats.
The company said in a statement: “This new company will propose a simple, modern and innovative offer, whose positioning will not be low cost.
It will offer customers business and leisure destinations with standards comparable to those of Air France in terms of product quality and professionalism of the crews.”
The WSJ added that the airline management is counting on the new airline to help it increase the number of passengers it flies to 100 million a year by 2020 from around 91 million today, to generate revenues of 28 billion euros (US$31.14 billion).
Skift reported that Air France-KLM recognized a need to come up with a low-cost arm to compete with discount carriers such as Ryanair and EasyJet.
The site predicted that the relatively small scale of the new airline will not heavily shake up the industry, and doesn’t prove a big enough challenge for long-haul services such as Emirates, Qatar Airways, and Etihad.