The eco decryption. Black year for Air France: can the company disappear?

Air France planes on the tarmac at Roissy-Charles de Gaulle airport. Illustrative photo. (STEPHANE DE SAKUTIN / AFP)

A black year, an unprecedented shock. The Covid-19 health crisis deprived Air France-KLM of two thirds of its passengers. With planes grounded, its turnover fell by 60%. And this, despite the savings and significant downsizing that continues. As of last spring, Air France nevertheless benefited from a loan guaranteed by the State of seven billion euros. As much as his losses. This infusion of new money allows him to last until the end of the year but Ben Smith, the CEO of Air France, admits that he will be “difficult” to repay them. The group expects a very uncertain recovery: the aviation sector may not return to 2019 traffic before 2024, at best.

>> Covid-19: the pandemic cost Air France-KLM € 7.1 billion

For Bruno Le Maire, the Minister of the Economy, France cannot do without its national company. The French State is a 14.3% shareholder in Air France, the next step considered is a recapitalization. It has been in discussion for several weeks. However, this arrangement must be validated by the European Commission. In return, Brussels wants to force Air France to give up connections, landing and take-off slots from Orly airport. This is a real blow for Air France, because Orly is the platform of Transavia, its low-cost company.

In addition, Air France will have to downsize with the climate law. The company plans to abolish domestic air flights on routes provided by train in less than 2.5 hours. Air France Orly-Nantes, Orly-Bordeaux and Orly-Lyon flights, which have not resumed, are in the hot seat. In this very gloomy picture, Air France is however clinging to a resumption of traffic in the second and or third quarter, thanks to the vaccines developed against the coronavirus.

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