Air France-KLM Plans to Launch a Budget Carrier to Serve Asia Routes

Nov 4, 2016

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The Air France-KLM group announced plans to take some of its operations away from its namesake brand and introduce a new airline within the group — and at lower fares. The carrier announced that it’s planning to launch a medium- and long-haul budget airline that could serve Asia routes and potentially even the US.

The motivation for the new airline is clear — AF hopes to take back business from the Middle Eastern carriers that have lured travelers in with low costs and improved products. Air France plans to start servicing routes to Asia with the new brand in winter 2017, by taking over some of the least popular Air France routes and operating them with staff earning lower salaries. In addition to the initial Asia routes, Air France said that it could begin transatlantic routes.

In the announcement, the carrier emphasized that the new brand will not be a low-cost carrier, and instead, it will hold standards similar to that of Air France. As it stands, Air France-KLM plans to have a fleet of 10 long-haul aircraft in operation by 2020, including some A340s.

There’s no word yet on what the new brand will be called or when exactly we’ll see it go into full operation. Overall, this move from Air France-KLM shows how it’s adapting to the current state of the travel industry — adjusting in order to reclaim its stake in the Asian market and mend its stressed relationship with current employees.

H/T: Nasdaq

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