Air France - KLM To Cut Full-freighter Operations, Amid Slow Recovery In Demand

(RTTNews) - French carrier Air France - KLM (AFLYY.PK) Thursday announced further reduction in its full-freighter operations, amid a slower than expected recovery in demand.

The company's Board of Directors has decided to reduce the full-freighter fleet based in Amsterdam to 3 aircraft in operation by the end of 2016. Five MD-11s will be phased out on an accelerated basis during 2015 and 2016.

By then, the group will operate five full-freighter aircraft: Two Boeing 777F in Paris and 3 Boeing 747ERF in Amsterdam, compared with a total of 14 in 2013.

The group plans to find alternative employment internally for all affected staff, and will consult with the Works Council and trade unions. Air France - KLM said it would remain a major player in the cargo sector in Europe through its extensive belly network, effectively supplemented by a limited number of full-freighter aircraft.

This adjustment of the full-freighter fleet is part of a broader strategic vision designed to increase cargo contribution to the group.

Other measures include a strong focus on specialized products such as pharmaceuticals and express, as well as investment in state-of-the-art IT infrastructure and E-developments, additional cost reduction and expansion of partnerships.

The decision follows the examination by the board of the findings of the strategic review of its full-freighter operations which was launched earlier this year.

Separately, the firm said its board approved the group's development project on the leisure market in Europe. This development will take place under the Transavia brand from the two existing airlines - Transavia France and Transavia the Netherlands. New bases will be opened in other European countries.

This project will strengthen the development of Transavia France and Transavia the Netherlands.

The terms of these developments are the subject of consultations in both countries, the carrier added.

The stock closed up 4.9 percent on Wednesday at 8.68 euros.