Air France-KLM, one of the top airlines in Europe, is currently struggling for its survival. The shares of the company have reached low up to 14.5%. The reason for this sudden decrease is due to quitting of Jean-Marc Janaillac, CEO Air France, over a pay disagreement and the refusal of the Government of France to help the company.
The French Government holds 14.3% shares of the company. The Finance Minister of France has proclaimed that the labor dispute has threatened the survival of Air France. He also added that the government will not offer the carrier with a bailout.
Janaillac has asserted that he would quit in the mid-May after about 10,000 of the French staff and pilots have voted in opposition to a multi-year payment offer.
KLM was included in the Air France in 2004, which made them as one of the leading group in Europe. International Air Transport Association also has announced Air France as the 17th largest airline if considered the passenger trips carried out by the company.
The company’s staff strike, which was continued for 13 Days, has resulted in the loss of $358 Million. On the other hand, the unions have planned for more strikes. Johannes Braun, an airline analyst at asset manager MainFirst Bank, has asserted that there will not be an immediate danger for Air France forcing the company out of business.
He also added that the company has offered the workers with a 7% rise over 4 Years. But the unions are expecting for better pay as the company is in healthier financial conditions as compared to the previous years. Although the company has faced a big loss in the first quarter, it has a healthy balance sheet.
Recently, French Government has experienced a great pressure on Wednesday, as hundreds of anti-capitalist protesters ran amok in Paris on Tuesday. These protesters torched a number of cars, bus stops, and a McDonald’s restaurant. About 109 people were taken in the custody by the police after the violence.