Air France-KLM to pursue a 'reduction in its unit costs and selective capex management'

Air France-KLM announced (11-Sep-2014) it will pursue a "reduction in its unit costs and selective capex management while adopting a disciplined approach to growth opportunities", as part of the company's 'Perform 2020' five-year plan. The company is targeting an annual unit cost reduction of 1%-1.5% as part of the plan, and "will go beyond traditional efforts directed at reducing unit costs" in order to achieve the target. Air France-KLM stated: "This will involve the ongoing restructuring of uncompetitive activities and implementing a systematic review of processes using benchmarking based on profit centers. It will also entail negotiating with staff on the achievement of productivity gains paving the way to growth." The company will undertake a "progressive increase in fleet capex", with investment to remain "below its pre-2012 level." Air France-KLM added: "Dedicated sources of funding will be allocated to significant development opportunities to ensure control over credit ratios. For example, the first phase in Transavia expansion will be financed by the €339 million proceeds generated from the partial disposal of Amadeus shares on 9 September." [more - original PR - English/French]