Facing competitive pressure, Air France to cut domestic network

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Air France Airbus A320
Photo Credit: Santi Rodriguez/Shutterstock

Air France will reduce its domestic network by 15% by the end of 2021, aiming to stem losses from short-haul operations. 

The carrier posted a loss of 189 million euros in 2018 on domestic flying and has lost 717 million euros from domestic operations since 2013. The losses are mounting due to the expansion of capacity in France's high-speed train network and growing competition from low-cost airlines, Air France said. 

The company outlined a plan to reduce domestic network staffing by 465 positions. The reduction would be carried out over a one-year period via voluntary departures. 

Air France-KLM CEO Ben Smith said that despite the cuts, Air France intends to remain the leader in French domestic flying. 

"In a highly competitive marketplace, we are all fully engaged in defending a domestic market that is vital for Air France and also more globally for the Air France-KLM Group," he said. 

Air France faces competition on domestic operations from budget airlines with lower cost structures -- most notably Ryanair and EasyJet. Still, the carrier maintains a 65% share of the domestic market, Air France said.

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