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France

Air France names interim leaders after CEO quit

media Former French minister Anne-Marie Couderc was named non-executive chairman of the Air-France-KLM board. Eric Piermont/AFP

The board of Air France-KLM named chief financial officer Frédéric Gagey as interim CEO on Tuesday after Jean-Marc Janaillac quit in a bitter dispute over salaries.

Former French minister Anne-Marie Couderc was named non-executive chairman at the French-Dutch group, which has been hit by months of strikes as unions seek a 5.1 percent pay rise at Air France this year.

Gagey, 61, will sit on a new management committee alongside Franck Terner and Pieter Elbers, CEOs of the French and Dutch operations respectively, who will act as his deputies.

But the board indicated that the temporary CEO will not have a mandate to find a way out of a pay dispute which management says has cost at least 300 million euros due to strikes since February.

"Regarding the ongoing labour dispute at Air France... the Air France CEO does not have a new mandate to take decisions that would jeopardise the growth strategy approved by the Air France-KLM board of directors," a statement said.

Janaillac had put his job on the line by calling a company-wide vote at Air France on whether to accept a proposed seven percent pay rise over four years.

He announced his resignation on 4 May after staff rejected the pay deal, sending the group's shares nosediving.

The board hailed Janaillac's track record, saying he had produced strong results since 2016 which had enabled a "successful turnaround and growth", and expressed "deep regret" over the strikes.

"These strikes will also have a negative impact on the group's financial results," the board said.

French Economy Minister Bruno Le Maire warned this month that "the survival of Air France is in the balance" as the strikes since February have repeatedly forced the airline to cancel around a quarter of flights a day.

Air France-KLM reported a net loss of 269 million euros for the first quarter, weighed down by the strikes.

Unions have said the pay rises offered are too little after six years of salary freezes, but management warns that improving company finances are vulnerable to competition from the Gulf and low-cost European carriers.

The board said the interm management structure would be in place "for the shortest-possible period" needed to appoint Janaillac's successor, without imposing a specific time limit.

Couderc, a lawyer by training and an Air France board member since 2016, is a onetime protegee of former French president Jacques Chirac who has spent her career between business and politics.

The 58-year-old served as employment minister and then labour minister in the 1990s before going back to the private sector as assistant general manager at publishing house Hachette.

She then took charge of French media distribution firm Presstalis, where her experience of lengthy labour disputes may come in handy for the new job at Air France.

Couderc launched a restructuring plan at Presstalis in 2012 which slashed the workforce in half, prompting repeated strikes which blocked the distribution of newspapers.

(with AFP)

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