Air France-KLM has set out a new five-year plan to return the group to “sustainable profitability”.
Chief executive Benjamin Smith said the group hoped to “regain its leadership position” in a “competitive and fast-transforming” European aviation market.
The group’s ambitions revolve around a new "value-focused" model for stakeholders, employees, customers and shareholders.
Priorities include optimising the group’s operational model; a renewed focus on growing passenger revenue from its most profitable segments; better utilising customer data; developing its Flying Blue loyalty programme; and taking a pragmatic approach to opportunities for consolidation.
Ongoing efforts, said Smith, include simplifying the group’s fleet; clarifying its brand and market positioning; and increasing commercial and operational flexibility via new labour agreements.
“This is the starting point of a strategy that will allow Air France-KLM to reinvent itself, creating value for all key stakeholders,” said Smith.
“We will optimise our operational model and increase revenues to significantly improve our operating margin. Everything we do will support our goal of remaining an industry pioneer as the airline group most committed to global environmental sustainability.”
In an update to investors, the group said it must better utilise its “unique assets”, namely its three brands, Air France, KLM and Transavia; its two Paris hubs (Charles de Gaulle and Orly); and its Amsterdam (Schiphol) hub to ensure it pursues "the most profitable traffic".
Key objectives include speeding up renewal of the group’s fleet, lobbying authorities in France to create a more competitive airline business environment, and simplifying its brand portfolio to ensure it revolves around its three airline brands.
Each of these brands will optimise its network to focus on its strengths: KLM will look to further strengthen its position at Schiphol to become the "benchmark carrier" for European connecting traffic; while Air France and Transavia will seek to "better leverage" their slot portfolios at Paris-Orly airport where slots are constrained.