Air France must cut CO2 emissions, and domestic flights as condition of state aid: says France’s Finance Minister
France’s Finance Minister, Bruno Le Maire, has told Air France that it will have to cut its carbon emissions and domestic flights, as conditions for government financial support. The French government has offered the airline a €7 billion package of state-guaranteed bank loans, and loans directly from the state. This is on condition that the airline map out a path to profitability and set the goal of “becoming the most environmentally friendly carrier in the world.” [Whatever that means]. Air France will have to halve its CO2 emissions per passenger, and per kilometre – compared to their 2005 level – by 2030. The CO2 emissions from domestic flights in France will have to be halved, and that means cutting the numbers drastically. Another condition is that 2% of the fuel used by its planes would have to be derived from alternative, sustainable sources by 2025. [Problem is there are almost no properly environmentally “sustainable” fuels, and pushing for them is likely to increase deforestation and loss of land for food growing, and for wildlife]. Air France also have to buy new planes, with lower CO2 emissions, from Airbus.
Air France must cut emissions, domestic flights for aid: says France’s Finance Minister
PARIS (Reuters) – Air France will have to cut its carbon emissions and domestic flights as conditions for government financial support, France’s finance minister said on Wednesday.
The aid was extended on condition that the airline map out a path to profitability and set the goal of becoming the most environmentally friendly carrier in the world.
Specifying those conditions, Finance Minister Bruno Le Maire told the lower house of parliament’s economics committee that the airline would have to cut its carbon emissions by half per passenger and per kilometre by 2030, from 2005 levels.
For flights specifically in mainland France, emissions would have to be halved by 2024, which Le Maire said meant that domestic flights would be “drastically reduced” to focus on serving hubs for transfers.
In a further condition, 2% of the fuel used by its planes would have to be derived from alternative, sustainable sources by 2025. [There are almost no properly environmentally “sustainable” fuels, and pushing for them is likely to increase deforestation and loss of land for food growing, and for wildlife]
“Lastly, investments will have to be directed in the coming years to renewing the fleet of long and medium-range planes to more effectively fight emissions,” Le Maire said.
Earlier Le Maire told LCI television that the carrier would be expected to be a “good customer for Airbus”, adding that the government could also support the European planemaker “massively when needed”.
Airbus said on Wednesday that the coronavirus pandemic had triggered the “gravest crisis the aerospace industry has ever known” as it highlighted plans to save cash after burning through 8 billion euros in the first quarter.
Le Maire told lawmakers that support for Airbus could come in the form of expanded export financing aid and state-subsidised furloughs, along with airline fleet renewals, starting with Air France.
($1 = 0.9216 euros)
Reporting by Leigh Thomas; Editing by Alex Richardson
Coronavirus: Air France-KLM secures billions in government aid
24 April 2020 (BBC)
Air France-KLM’s boss said the company would rethink its operating model “immediately”.
Air France-KLM has secured at least €9bn (£7.9bn; $9.7bn) in government aid, as the Franco-Dutch airline group struggles to stay afloat because of the coronavirus outbreak.
The French authorities said Air France would get €3bn in loans and another €4bn in state-guaranteed funds.
Meanwhile, the Dutch government said it was preparing between €2bn and €4bn in aid to KLM.
Major world airlines all but halted passenger traffic around the world.
But they still have to pay to park and maintain planes that have been grounded.
Earlier this year, Air France-KLM estimated the outbreak would cost the group between €150m and €200m in February-April.
Company Chief Executive Ben Smith warned on Friday that the government aid was “not a blank cheque” and would require tough action on costs and performance, Reuters news agency reports.
“This financing will give us the opportunity to rebuild. Faced with the upheaval the world is going through, we are going to have to rethink our model immediately,” he added.
The group is the result of a merger between Air France and KLM in 2004.
With a fleet of 550 aircraft, it covers 312 destinations in 116 countries around the world. In 2018, Air France-KLM’s passenger traffic exceeded 100 million.