The global aviation situation is obviously dire, and we’re seeing just about all airlines institute emergency plans. Air France-KLM is the latest airline group to announce major cuts.
In this post:
Air France-KLM cutting 70-90% of flights
Air France-KLM has announced some sweeping measures to respond to the current global crisis, as airlines face increasing government restrictions, and a big decrease in demand, which has resulted in a drop in traffic and sales over the past few weeks.
Air France-KLM is planning on reducing capacity by 70-90% over the coming weeks (measured by available seat kilometers). As of now these reductions are planned for two months, though they will be extended as need be.
Air France-KLM has taken a number of measures to deal with the current situation and secure cash flow, including:
- Savings measures have been identified, that will generate €200 million in 2020
- Capital expenditures will be reduced by €350 million
- Consulting with elected employee representatives on measures to reduce labor costs
- Air France-KLM has drawn a revolving credit facility for a total of €1.1 billion, and KLM has drawn a revolving credit facility for a total amount of €665 million; the company has over €6 billion in cash and cash equivalents
Air France-KLM expects massive drops in revenue, and notes that the reduction in capacity will only be offset by around 50% by the drop in variable costs before cost savings measures.
Air France-KLM is asking the French and Dutch governments for support.
KLM retiring 747s early
KLM had been planning on retiring their remaining Boeing 747-400s by the end of 2021. The company has already been retiring these, and at this point the company has a total of 10 Boeing 747-400s left.
KLM plans to retire all of these by the end of March, given the huge reduction in demand. Unfortunately yet another airline will be retiring the queen of the skies. It’s sad as an aviation geek, but completely understandable, given the operating costs, necessary maintenance, and capacity of the plane.
KLM is retiring remaining 747s early
Air France grounding (or retiring?) A380s
It has also been announced that Air France will ground its entire Airbus A380 fleet. It’s not explicitly stated that these planes will be retired, though personally I wouldn’t be surprised if this represents the end of the A380 for the airline.
Previously Air France planned to retire all A380s by the end of 2022, and has already started the process of retiring their first A380s. At this point it seems like it would be logical for the groundings to just be permanent, as this is an easy way for them to reduce capacity.
It’s unlikely that demand will recover to pre-2020 levels anytime during the year.
Air France is grounding A380s, but could they just be retiring them?
Bottom line
All airlines are taking extreme measures to deal with the current situation. In the case of Air France-KLM, expect a 70-90% decrease in capacity, and groundings of Air France A380s and KLM 747s.
The KLM 747s are just outright being retired, while it’s not yet known if the Air France A380s will be back in the skies, or whether this is permanent as well…
@Aniro
I hate coffins too. But not having aisle is worse. Not because of privacy, but the hassle of climbing over someone. Fortunately Apex Suites solves all this problem. It's just too bad not many airlines fly them. I've flown them on KE and JL.
I just saw a KLM 747 landing at yyz this afternoon. Had I been aware I would have taken a picture and saluted it
Sad that tonight was maybe the final night seeing the AF A380 depart MIA.
And @Ben, a perk of having to work from home in Miami, I finally got to see the Cathay Pacific Cargo 747 take off this morning!
Eskimo,
Some of us prefer legroom and not being in a coffin to aisle access. I am very sad about this with the 747, as I was booked in economy comfort and business return upstairs, not that the flights will be happening anyway with the travel ban.
Lucky, this is still a rumour regarding their retirement, they have still not confirmed it officially yet.
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How come no one talked about how AF/KL lost billions from fuel hedge.
KLM hard product deserves to be retired. Only their 787 has direct aisle access.
Too bad I won't have a chance to fly on the 747 combi anymore.
Frivolous though it sounds in the middle of a worldwide crisis, I’m bummed about this news. I went out of my way to book a planned trip from Orlando to London in November, to include leg from Vancouver to Amsterdam, just so I could sit in the single seat in the nose of a 744, one last time. Sigh.
Was on a 744 Combi this January (just before this virus went truly global). Glad to have flown in it one last time, even if it wasn't the best in Economy Comfort seating
Really sad to see the KLM 747s go. They have been an icon of KLM and I'm really disappointed to see them just get rid of them. I've had lots of fond memories both in the back of the B744 Combi with horses neighing and on the upper deck in Business Class. I wish they ordered B748s, but they didn't. KLM is really starting to lose its image and identity :(
KLM is not being clear about the retirement of its 744/744Combi fleets... on some sources they have said end of March and in others April. Wouldn't they have some cargo contracts to honor? On some markets the cargo is more profitable than the passengers and cargo can't really pass on the coronavirus.
KLM´s 744 have been a joy to fly. Especially their economy comfort in this plane has been one of the most enjoyable long distance economy experiences I know of. Fond memories flying to all sorts of exciting places with these.
Virgin Atlantic is stopping flights between Heathrow and Newark, and overall vastly reducing their operations (the goal apparently is 80% reduction in flights per day by 26 March, and grounding 75% of their fleet by same date).
So sad to see the planes go :(
Haven't been on A380 yet
How is your business doing right now? I can’t imagine that there’s a great demand for travel with points right now... are you worried about it?
It wouldn’t surprise me if a condition of Dutch government financial support for KLM is a demerger from Air France. Now’s the opportunity.