Air France creating lower cost airline to better compete

PARIS — Air France plans to create a new budget airline in hopes to better compete with Mideast carriers and low-cost rivals.

Parent company Air France-KLM said in a statement Thursday that the new airline would focus on routes where Air France is struggling against cheaper competition.

It said the airline would run long-haul flights for tourist and business travel. It would use Air France pilots who volunteer to work under new rules “adapted to its competitive position.” Air France staff have protested job cuts and other cost-cutting in recent years.

CEO Jean-Marc Janaillac is presenting the plan Thursday to the works council.

In quarterly results Thursday, Air France-KLM noted a “highly uncertain” global context and “special concern about France as a destination” after deadly extremist attacks.

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