Air France and Ryanair CEOs see different flight paths for resumption of travel – Skift

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Full-service carriers like Air France are copying certain economic operators like Ryanair to compete with them by minimizing the consumption of cash during the pandemic. But a long-term change is also underway in Europe. The climate change mandates of Western European governments are prompting carriers of all types to rethink and prune their networks built up over the years.As part of its bailout plans, the French government has been pushing to cut the country’s internal routes which fly around two hours or less. This push affects both traditional carriers like Air France and newcomers like Ryanair. Austria imposed similar restrictions on short-haul flights on Austrian Airlines, owned by the Lufthansa Group, earlier this year.

“There were conditions to come with the support of the French government, and one of the conditions is to reduce our environmental footprint much more quickly, in particular at the domestic level”, declared Thursday Anne Rigail, CEO of Air France during of the Skift Aviation Forum. online.

“We have closed some unmatched connections from Paris, where there were alternatives on routes shorter than two hours and thirty minutes,” Rigail said. “We are working with SNCF to improve our intermobility and our connections. Environmental awareness is more and more acute. We are adding many actions to make this a top priority for the airline. “

Anne Rigail, CEO of Air France, spoke with Brian Sumers, Editor-in-Chief of Skift, at the Skift Aviation Forum.

Rigail is attempting to fundamentally transform Air France’s domestic flight network, which had suffered losses for years and which has seen those losses worsen as low-cost carriers have increased their competitiveness in the domestic market over the past two years . Air France also has its low-cost brand, Transavia, which tries to compete on a par with low-budget brands.

Longtime network operators are taking steps to compete with low-cost brands. This week, the Lufthansa Group said it would stop offering free meals on short-haul flights.

Air France does not intend to imitate this decision.

“We’re not thinking of buying on board at this point,” Rigail said.

But the carrier is looking to save money in other ways. Rigail said Air France could replace some of the business class seats on some planes with an economy class seat in a single working day, helping to make the carrier more competitive with budget carriers.

“This crisis is a catalyst for transformation,” Rigail said. “In terms of economic performance, we hope to emerge stronger than the competition because we have no choice. Everyone is totally committed to reducing our costs to transform our business with 150 initiatives. “

The Ryanair push

Eddie Wilson, who was appointed CEO of Ryanair DAC a year ago, under the leadership of Ryanair Group CEO Michael O’Leary, had very different views on some of these issues in his interview with Matthew Parsons, Skift Business Travel Editor.

Ryanair has launched legal proceedings over some of the bailouts and related government moves in favor of carriers across Europe.

“The European Union was created to have a free market, and now what you have is an airline that was once owned by a government, just because of the tail and the colors it has on it. plane, gets a huge bailout for no good reason other than it looks a lot like the national flag, ”Wilson said. “It is seriously discriminatory…. In France for example, there is a reduction on taxes for airlines but only if you are French…. You have Lufthansa being bailed out to the tune of around 11 billion euros, and they’re back for more money.

Wilson scoffed at the idea that European network operators would emerge from the crisis stronger than before.

Ryanair CEO Eddie Wilson at the Shift Aviation Forum. Source: Shift.

“The tide is out,” Wilson said, suggesting that the revenue crisis has exposed many other carriers as having weak business models. “The main traditional carriers are going to be burdened with debt.”

“We have the lowest unit costs in Europe,” Wilson said. “Our closest competitor last year would be almost 25% higher…. This activity for us has always been a question of costs. ”

On the efficiency front, Wilson said Ryanair’s costs would drop again once it could take possession of new Boeing 737 Max jets, which were ultimately approved for a safety assessment and promise lower costs. fuel and operation.

“On airplanes, we’re ahead of everyone else’s seat base,” Wilson said. “Now we’re going into the Max order, where we’re going to have eight more seats and 16 percent less fuel, and that’s going to bring things down even more.”

However, Ryanair does not need more 737 Max aircraft than it has ordered. Ryanair sees opportunity to acquire inexpensive planes as the crisis continues, Wilson said.

While Air France’s Rigail was bullish on the potential of airport testing to speed up travel, Wilson was bearish.

“Like I’ve said at a lot of airports, if the tests work and you can test everyone going through an airport, then you don’t have enough passengers,” Wilson said. “We got a little obsessed with this idea, we’re going to walk people through the equivalent of a car wash or something. The idea that you can get the traffic back by testing at airports, well, that can’t work. ”

Photo credit: Charles de Gaulle airport in Paris, seen at night during busiest periods. The main bosses of Air France and Ryanair differed over the competitiveness, fairness and value of airport testing at the Skift Aviation Forum. ADP Group

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