Air France-KLM Group finalised (19-Jun-2013) a firm contract for 25 A350-900 aircraft and for a further 25 options. The airline said the aircraft will be an essential part of the Group's future fleet strategy. Air France-KLM Group chairman and CEO, as of 01-Jul-2013, Alexandre de Juniac said, "This order of new-generation, high performance aircraft reflects the importance of our investments for the benefit of our customers, whose comfort is at the heart of our concerns. With the A350, Air France-KLM will continue to operate one of the most modern fleets in the world, and ensure the growth of its long-haul activity, while achieving significant cost savings." Air France-KLM also signed a MOU with Rolls-Royce for Trent XWB engines to power the 25 aircraft on order, in an agreement worth USD1.1 billion at current list prices. Air France-KLM Group currently operates over 190 Airbus aircraft. [more - original PR] [more - original PR II]
Air France-KLM finalises firm contract for 25 A350-900 aircraft
You may also be interested in the following articles...
Air France-KLM Group dreams of CDG airline boosting Air France; KLM again makes more profit in 2016
In 2016 Air France-KLM's long haul network generated more profit than the group as a whole. Yet the dependence of Air France-KLM's profits on the long haul business is under threat from more cost efficient competitors, in particular the Gulf based super connectors. Moreover, Air France-KLM's main European competitors IAG, and now Lufthansa, have developed a clear lead in developing commercial partnerships with Gulf airlines.
Air France-KLM's 2016 operating margin was its highest since before the global financial crisis, but remained below its pre crisis peaks and well below the rest of the world airline industry in what was almost certainly a new record year for global margins. Within the group, KLM's margin improved and was again higher than that of Air France, whose margin fell.
The planned new lower cost airline to be based at Paris CDG as a subsidiary of Air France, announced in outline in 2016 under the project name 'Boost', will now include medium haul in addition to long haul routes. This will be vital to setting it back on a path to sustainable profitability – if agreement can be reached with pilot unions to launch it. Even then, its scope and low cost ambitions will be limited.
Global Fleet Outlook: Deliveries peak, as order highs decline.
Airlines are set to add more new aircraft than ever before in 2017. After years of record ordering and building backlogs, aircraft manufacturers are making good on their promises to ramp up production. The industry is enjoying record levels of growth and profitability; with solid passenger market fundamentals, and both airlines and leasing companies having access to ready liquidity, cheap debt and plentiful equity capital, making financing fleet orders easier than at any time before the global financial crisis.