This article is from the source 'nytimes' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at http://www.nytimes.com/2014/09/29/business/international/air-france-pilots-end-two-week-strike.html

The article has changed 4 times. There is an RSS feed of changes available.

Version 0 Version 1
Air France Pilots End Two-Week Strike Air France Pilots End Two-Week Strike
(35 minutes later)
PARIS — The union representing thousands of striking Air France pilots said on Sunday that it had “decided to accept its responsibilities” and end a crippling two-week strike, although it stopped short of accepting management’s plans for expanding a low-cost subsidiary.PARIS — The union representing thousands of striking Air France pilots said on Sunday that it had “decided to accept its responsibilities” and end a crippling two-week strike, although it stopped short of accepting management’s plans for expanding a low-cost subsidiary.
The airline said it would gradually restore regular flight services over the coming days, but warned that a return to its normal schedule was unlikely before midweek.
A new round of negotiations overnight ended early Sunday “with a text that does not suit us,” the French National Union of Airline Pilots said in a statement to Agence France-Presse. The union, which represents nearly three-quarters of the 3,800 Air France pilots, said it was ending its walkout in order to “pursue discussions under more serene conditions.”A new round of negotiations overnight ended early Sunday “with a text that does not suit us,” the French National Union of Airline Pilots said in a statement to Agence France-Presse. The union, which represents nearly three-quarters of the 3,800 Air France pilots, said it was ending its walkout in order to “pursue discussions under more serene conditions.”
An Air France spokesman was not immediately available to comment and it was not clear when normal flight service would resume. The strike has grounded more than half of the airline’s flights since the walkout began on Sept. 15, and has cost its struggling French-Dutch parent, Air France-KLM, as much as 20 million euros, or $25.4 million, per day. Air France expressed relief at having arrived at the end of a “costly and damaging” strike, which began on Sept. 15 and has cost its struggling French-Dutch parent, Air France-KLM, as much as 20 million euros, or $25.4 million, per day. But the airline said it “deplored” the union’s refusal to endorse management’s revised strategic plan and sign an accord bringing a formal end to the dispute.
Manuel Valls, the French prime minister, immediately welcomed the end to the walkout, which he described as “too long” and “misunderstood.” He stressed that the French government, which owns a 16 percent stake in the airline, would “stand by the company and its employees, who were plunged into uncertainty by this episode.” Mr. Valls had stepped up pressure on the pilots in recent days to return to work. He rejected an appeal by union leaders for the government to appoint an independent mediator. Nonetheless, management reiterated its intention to accelerate the expansion of the group’s Transavia budget carrier in France in order to compete head-to-head with larger regional rivals like Ryanair and easyJet.
“A solution to end the conflict is on the table,” Mr. Valls said late Friday. “It is up to the pilots to seize it.” “This expansion will take place, as planned, under competitive economic and social conditions,” Air France said in a statement.
“The emergence from the conflict only reinforces the company’s determination to advance its business model,” it said. “The strategic interest of the company must remain the goal of all” employees.
Manuel Valls, the French prime minister, welcomed the end of the strike and said that the French government, which owns a 16 percent stake in Air France, would “stand by the company and its employees, who were plunged into uncertainty by this episode.”
Mr. Valls had stepped up pressure on the pilots in recent days to return to work. On Friday, he rejected an appeal by union leaders for the government to appoint an independent mediator.
The pilots walked off the job to protest Air France-KLM’s strategy to develop its low-budget subsidiary, Transavia, into a leading European budget carrier that would directly compete against larger regional rivals like Ryanair and easyJet. The pilots said they were concerned that the plan, which involved up to €1 billion in new investment in dozens of new planes and the hiring of hundreds of pilots, would eventually lead to lower wages and longer working hours for the group’s French pilots. Air France pilots fly significantly fewer hours per year than the maximum allowed under European regulations.The pilots walked off the job to protest Air France-KLM’s strategy to develop its low-budget subsidiary, Transavia, into a leading European budget carrier that would directly compete against larger regional rivals like Ryanair and easyJet. The pilots said they were concerned that the plan, which involved up to €1 billion in new investment in dozens of new planes and the hiring of hundreds of pilots, would eventually lead to lower wages and longer working hours for the group’s French pilots. Air France pilots fly significantly fewer hours per year than the maximum allowed under European regulations.
In order to calm those fears, Air France-KLM last week offered a major concession by abandoning a key element of its strategy that would have based up to one-third of Transavia’s new planes and employees in lower-wage European countries like Portugal. However, management has refused to agree to the union’s demand for uniform working conditions and pay scales for all pilots across the Air France-KLM group, arguing that Transavia could not compete with established low-cost carriers without significantly lowering its operating costs, including wage costs.In order to calm those fears, Air France-KLM last week offered a major concession by abandoning a key element of its strategy that would have based up to one-third of Transavia’s new planes and employees in lower-wage European countries like Portugal. However, management has refused to agree to the union’s demand for uniform working conditions and pay scales for all pilots across the Air France-KLM group, arguing that Transavia could not compete with established low-cost carriers without significantly lowering its operating costs, including wage costs.
Under the terms of its latest proposal, submitted to unions on Friday, Air France-KLM said it was prepared to hire as many as 1,000 new employees for Transavia, including 250 pilots, over the coming two to three years and was ready to begin expanding Transavia in France as early as next summer. The investment plan includes the addition of around three dozen new Boeing 737 single-aisle jets to Transavia’s French fleet.Under the terms of its latest proposal, submitted to unions on Friday, Air France-KLM said it was prepared to hire as many as 1,000 new employees for Transavia, including 250 pilots, over the coming two to three years and was ready to begin expanding Transavia in France as early as next summer. The investment plan includes the addition of around three dozen new Boeing 737 single-aisle jets to Transavia’s French fleet.
Management said no Air France pilots would be required to fly for Transavia, whose pilots fly longer hours for less pay. But the company said those who volunteered to do so would accumulate flight hours, and therefore seniority, more quickly than at Air France, placing them in line for earlier promotion within the group.Management said no Air France pilots would be required to fly for Transavia, whose pilots fly longer hours for less pay. But the company said those who volunteered to do so would accumulate flight hours, and therefore seniority, more quickly than at Air France, placing them in line for earlier promotion within the group.
Air France said that, for safety and logistical reasons, flights that had already been canceled on Sunday and Monday would remain so. The return to normal service was expected to begin on Tuesday, once the grounded aircraft, pilots and cabin crews were repositioned around the world.
With the immediate crisis seemingly averted for now, analysts said that Air France-KLM still faced an uphill battle to transform Transavia, which last year reported an operating loss of €23 million, into a profitable challenger to Europe’s broad field of budget carriers, which already claim around 40 percent of the region’s market for air travel.
“The airline is late to the game in trying to turn around its domestic operations,” said John Strickland, an independent aviation consultant in London. “Unless Air France can improve the productivity and working relationships with its pilots then its chances of success in such a competitive market are low.”
By agreeing to forego the addition of new Transavia bases outside France and the Netherlands, analysts said, Air France-KLM could struggle to achieve its target of reducing Transavia’s operating costs by 15 percent.