Air France-KLM

Air France-KLM (Euronext: AF) is a European airline holding company incorporated under French law with its headquarters at Paris-Charles de Gaulle Airport in Tremblay-en-France, France, near Paris. The group has offices in Montreuil, Seine-Saint-Denis, near Paris, and in Amstelveen, Netherlands.

Air France-KLM is the result of the merger in 2004 between Air France and KLM.

In 2008, it was the largest airline company in the world in terms of total operating revenues, and also the largest in the world in terms of international passenger-kilometres. The company's CEO since 1 January 2009 is Pierre-Henri Gourgeon, following Jean-Cyril Spinetta.

Both Air France and KLM are members of the SkyTeam airline alliance. They offer a frequent flyer program called Flying Blue. The company's namesake airlines rely on two major hubs: Paris-Charles de Gaulle Airport, near Paris, and Amsterdam Airport Schiphol, near Amsterdam.

Air France-KLM Airlines transported 71.374 million passengers in 2009.

Financial details

In May 2010, Air France-KLM announced increased losses (€1.56 billion for the year to 31 March 2010), and warned that the 2010 eruptions of Eyjafjallajökull had caused a further €160 million loss in the current financial year.

Air France-KLM is one of the largest airline companies in Europe, with 202.5 billion passenger-km in the year ending 31 March 2010.

Private shareholders own 81.4% of the company with 37% held by former Air France shareholders and 21% held by former KLM shareholders. The Government of France owns the remaining 18.6%.

In June 2008, Air France-KLM agreed to pay $350 million to settle charges of cargo price fixing in an investigation conducted by the U.S. Justice Department. Cathay Pacific Airways, Martinair Holland, and SAS Cargo Group also agreed to fines bringing the total to $504 million. In November 2010, the European Commission fined Air France-KLM €310 million following another price-fixing investigation.

Subsidiaries and minor interests

Air France-KLM

Wholly-owned subsidiaries of Air France-KLM include:

Air France, Brit Air, CityJet, Régional, KLM, KLM cityhopper, Martinair, 

Transavia.com, Transavia.com France, Transavia.com Denmark,

Air France Cargo is part of Air France. Régional and Brit Air are regional airlines of Air France. Together with CityJet they are subsidiaries of Air France within Air France-KLM.

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KLM Cargo is part of KLM. KLM cityhopper is the regional airline of KLM. Together with Martinair and Transavia Airlines they are subsidiaries of KLM within Air France-KLM.

Air France-KLM also owns Cobalt Ground Solutions (ground handling) based in London Heathrow Airport but also operating in London City Airport.

Airlines in which Air France-KLM owns a minority interest:

Air Calédonie 2%, Air Mauritius 5%, Air Tahiti 7%, Airlinair 19.5%, 

Alitalia 25%, Air One, Air One CityLiner, Alitalia Express, 

CCM Airlines 12%, Kenya Airways 26%Royal Air Maroc 3%, 

Atlas Blue, 

Potential negotiations with Japan Airlines

Air France-KLM, along with its partner Delta Air Lines, were in talks about investing with Japan Airlines, which is part of the Oneworld alliance (rival to SkyTeam) but is experiencing financial problems. Air France-KLM, along with Delta and Delta's rival American Airlines (AMR Corporation; part of Oneworld) discussed investments for a sum of $200–300 million to help the financially-struggling carrier, which is Asia's largest airline by revenue. The Ministry of Land, Infrastructure, Transport and Tourism of Japan had recommended Air France-KLM and/or Delta for being partners because of their "healthy" financial status compared to AMR Corporation.  Delta was also recommended because of its extensive Asian network acquired through the acquisition of Northwest Airlines; Korean Air, also a SkyTeam member, was also in talks with JAL on the negotiations. Air France, Alitalia, Korean Air, China Southern Airlines and Vietnam Airlines are SkyTeam members that currently have codesharing with JAL.

On February 7, 2010 several news outlets reported that JAL will decide to keep its alliance with American Airlines and end talks with Delta. New JAL CEO Inamori and ETIC officials, according to the reports, decided that switching alliances (from Oneworld to SkyTeam) would be too risky and could hinder JAL's ability to turn around the airline quickly.

On February 9, 2010 JAL officially announced their decision to strengthen its partnership with American, which includes the joint application of antitrust immunity approval on transpacific routes. The airline will also fortify its relationship with other partners in the Oneworld alliance. 

Fleet

Nose of a KLM Boeing 737 showing the words 'Air France-KLM'

KLM Boeing 737-300. The nose carries the words 'Air France KLM'. (2008)

Air France Airbus A320-200

The fleet of Air France-KLM includes the fleets of its subsidiaries, the fleet of Air France (250), and the fleet of KLM (113). Furthermore the fleets of Régional (53), Brit Air (40), KLM cityhopper (48), CityJet (39), Transavia.com (26) and Martinair (19) are fully part of the company. The total number of planes in the fleet is 589 as of November 2010, this is incl. cargo. Without cargo, the fleet-size would be 564, since the cargofleet-size is 25. The total amount of orders is 80 for passengerplanes and 2 for the cargo ones.

Air France-KLM was created by the mutually-agreed merger between Air France and Netherlands-based KLM on 5 May 2004.

As a result of the deal, the French government's share of Air France was reduced from 54.4% (of the former Air France) to 44% (of the combined airline). Its share was subsequently reduced to 25%, and later to 18.6%.

At the time of the merger in May 2004, Air France and KLM combined offered flights to 225 destinations in the world. In the year ending 21 March 2003, the two companies combined transported 66.3 million passengers.

In October 2005, Air France Cargo and KLM Cargo, the two freight subsidiaries of the group, announced a merge of their commercial activities. The Joint Cargo Management Team now operates the organisation worldwide from the Netherlands.

In a 2007 opening for a majority takeover of the loss-generating Alitalia, Air France-KLM was one of three bidders, and was favoured by the board of Alitalia.. However, on 2 April 2008, it was reported that negotiations have been abandoned. After the acquisition of Alitalia and Air One by Compagnia Aerea Italiana on 12 December 2008, Air France-KLM has announced it is interested once again in purchasing a participation in the new merged company. On 12 January 2009, Air France-KLM announced that it will buy a 25% share in this company for €323 million.

Head office

Head office of Air France-KLM in Roissypôle

Air France-KLM's head office is located in the Roissypôle complex on the grounds of Charles de Gaulle International Airport and in Tremblay-en-France, near Paris. The 130,000 square metres (1,400,000 sq ft) complex was completed in December 1995. The French firm Groupement d'Etudes et de Méthodes d'Ordonnancement (GEMO) managed the project. The architect was Valode & Pistre and the design consultants were and Sechaud-Boyssut and Trouvin. The project had a price of 137,000,000 euros.

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