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Air France-KLM is being brought to its knees by its unions

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guest-lswojwj

Although I completely agree with the article's main point - that the Airline 's pilots are bringing the company to its knees - and they are a pretty selfish minority, it should also be pointed out that AirFrance has also opened up low cost subsidiaries with cheaper wage deals for staff - Hop! and Transavia are 2 that come to mind. Indeed was the origin of the current strikes not because Air France wanted to do a similar wage deal for the long-haul business? The Economist likes painting France as backward in terms of industrial restructuring, and indeed Air France is behind its competitors here, but at least it is trying to restructure. We wait and see what will happen next.

mchakravarty

Until and unless the scourge of 'Union' be eliminated, all businesses will suffer colossal losses. The greatest impediment to commercial progress are 'Unions'. This socialistic mentality and its idealism to strike work is nothing but a mindset to hold authorities and the general public hostage. Any issues related to jobs, salaries and perks can be comfortably addressed through appellate courts and courts for redressal. No one has the moral right to inconvenience the public or to cause harm to the economy.

nearmsp

The French government should have sold off the 14% of Air-France it still owns. This would make the unions take their managements more seriously. This seems to be a Detroit 2 story. Unions never believe the management when it says salary increases at above industry rates are not sustainable.

Tom Meadowcroft

The unions do not believe that management is serious; they also believe that the French state will bail out Air France no matter what. They will continue to behave as they have until somebody disabuses them of that notion.
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The solution is to begin shrinking Air France and laying off the union members. Start by eliminating the least profitable 1/3 of routes. Lay off 1/3 of the employees, and tell them that 2 years after the first layoff, the second layoff will happen, with the next 1/3 of the company. Sell off whatever assets you can.
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France needs reliable and economic air transport. It does not need Air France; there are plenty of others who will be happy to supply the service; the airports will remain just as full. The sooner the employees of Air France realize this, the better.

California Man

So here is the problem. Macron promised the voters that he would bring workplace sanity back to France after decades of destructive union activity. He won't and he cannot. Sympathetic French bureaucrats and judges and press will continue to prop up these corrupt unions even at the price of destroying the French state.
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Only 23% of French earners pay any income tax at all. Unemployment for people under 30 is over 40%. Multinationals have avoided locating in France since 1980 based on the pernicious attitudes of the French government.
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And Macron cannot fix it. He is Lionel Jospin in a better suit.

CA-Oxonian

In the 1970s unionized British workers bet that they could demand infeasible pay awards from the British motorcar industry and the coal industry.

Which is why the UK no longer has an indigenous automobile manufacturer (aside from some minnows surviving at the very edges of the market). British Leyland went bust. Likewise the UK's pits are for the most part dormant now.

KLM executives must presumably be wondering how to extricate themselves from Air France before the entire organization collapses under the weight of higher-than-feasible costs. As for Air France itself, it is France writ small: unwilling to accept economic realities, clinging to the past, bent on extracting whatever concessions may be left, while failing to notice that everything is sinking deeper and deeper into the quicksand of time.

Duck_Hook in reply to CA-Oxonian

It goes even deeper than this. There is a large French contingent, especially obnoxious among their intelligentsia, who think that realities (both economic and otherwise) don't apply to them. "The rest of the world can drink the Anglo koolaid if they want, but we can and will tread our own path."

Their crazy unions are only one manifestation of this denialism. It also rears its delusional head in French foreign policy, the obsession with French language 'purity', and—in counterpoint to the unions—incestuous corporate/government ownership structures that twist business logic and market forces into pretzels.

The wonder is that the French manage to get anything done at all.

Kremilek2

One has sometimes an impression that striking is a favourite French past time whatever the economic reality. In this case, it is a moral hazard since I bet that these unions think that French state will bail them out. We shall see.