The French government should not, and will not, bail out Air France-KLM or try to protect it from competition, the airline's new chief executive has said as he prepares for negotiations with unions.
Benjamin Smith told that President Emmanuel Macron's government was prepared to sell its 14 per cent stake, even though some at the airline regarded the state's stake as an insurance policy.
“The government has recently made clear that this is not a good assumption,” Mr Smith said in Paris, adding that if the state's “messaging and position” stayed consistent then the timing of a sale “shouldn't make a difference” to his ability to do his job.
Bruno Le Maire, the French finance minister, pushed back at suggestions of a near-term sale yesterday. “It is not one of the priorities. My priority is the recovery of Air France,” Mr Le Maire told the radio station France Info. “The state would be a poor manager if it started selling its shares in a company that is not in good shape.”
Mr Smith, who was Air Canada's chief operating officer, took over the group10 days ago. Trade unions had opposed the Canadian's appointment, calling it “inconceivable” that the French flag carrier could have “a foreign leader”.
Air France-KLM had been without a chief since the resignation of Jean-Marc Janaillac in May after he lost a staff vote over a pay deal rejected b yunions.
Mr Smith must now negotiate with unions that led 12 days of strikes, costing €335m, in the first half of the year. The group's shares have fallen 37 per cent so far this year.
Mr Smith said the government's holding in Air France-KLM provided some “stability” but noted that it had been made clear that Paris would sell “at the right time”.
“Whether you are Anglo Saxon or not Anglo Saxon ... there is a reality ...and a lot of other areas that the government needs to spend its money on,” he said. “At the end of the day it's very expensive to bail out an airline.
Outsider must rebuild trust at Air France-KLM