Air France scraps flights as crew strike continues

Air France’s 15,000 cabin crew will disrupt flights for a fourth day today in protest at cuts to staffing levels, grounding about 10 percent of services including long-haul trips to Abu Dhabi, Atlanta and Montreal, Bloomberg reports.

Air France-KLM Group fell 6.9 percent in Paris yesterday when its French unit cancelled 10 percent of 1,000 scheduled flights after halting about 120 on Oct 30 and 130 on Oct 29. Unions put the cancellations at 171 and 209, respectively.

Cabin-crew unions have called a strike for Oct 29 to Nov 2, spanning the All Saints Day holiday, one of France’s busiest travel periods, as they seek to halt plans to cut staff levels on Airbus SAS single-aisle jets. Air France is seeking to reduce costs after an earnings slump forced the departure this month of Pierre-Henri Gourgeon, its chief executive officer.

“It’s extremely important for the carrier to get to grips with headwinds coming from the unions,” said Frank Skodzik, an analyst at Commerzbank in Frankfurt with a “hold” rating on Air France-KLM stock. “Obviously, it has come at a very bad time with the public holiday, but in the longer term the damage to the brand and the share price is usually quite limited.”

The Paris airports of Charles de Gaulle, Europe’s second busiest, and Orly, as well as the terminal in Marseille, are among those affected. The dispute is continuing as Australia’s Qantas Airways resumed flights yesterday after a labour regulator barred stoppages that prompted the carrier to ground its fleet, stranding about 80,000 passengers over the weekend.

Air France has tried to restrict cancellations to high- frequency European routes, where it’s easier to rebook seats. Some US services have halted because the company was able to shift people to SkyTeam alliance partner Delta Air Lines.

Air France’s flight attendants are represented by seven different labour groups, six of which called the walkout, according to the carrier. Two have since halted industrial action, it said yesterday, while the seventh and biggest, the UNAC, representing 27 percent of crew, isn’t involved.

“This good news, which confirms that the action begun last Saturday is losing momentum, is proof that the door to negotiations is never closed with the trade unions,” Air France said in a statement yesterday.

The dispute hinges on plans to cut one flight attendant from each of its Airbus A319 planes, leaving three, according to Barrand, who said the carrier has already agreed to keep the number at four for trips longer than three hours. It also gave ground on an issue regarding performance assessment, she said.

Air France-KLM reported operating losses in two of the past three fiscal years following 11 years of profitability and is targeting nothing more than breakeven for 2011. Its reputation also took a hit after safety experts said pilot training was a factor in a 2009 crash that killed 228 people, a factor that spurred the reinstatement of Jean-Cyril Spinetta as CEO.

International Air Transport Association figures published yesterday show that global passenger traffic grew 5.6 percent last month, accelerating from a 4.6 percent gain in August, in what CEO Tony Tyler said was “a pleasant surprise.”

IATA said it’s still expecting a “general weakening” in coming months, with a continuing slump in freight traffic, which deepened to 2.7 percent in September from 2.4 percent in August, indicating the likely future trend for the passenger sector.