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Air France strike hits Europe, Lufthansa pilots cancel

A passenger waits at a check-in counter on the first day of an Air France strike

By Natalie Huet, Kirsti Knolle and Tim Hepher

EUROPEAN travellers face continued disruption as Air France pilots began a week-long strike in a dispute over cost cuts, but a pilots union at the last minute called off a strike planned for Tuesday at Germany’s Lufthansa.

Air France said it had been forced to cancel six out of ten flights on Monday and predicted the same level of groundings the next day.

Air France pilots intend to strike until Friday over the carrier’s plans to expand the low-cost operations of its Transavia brand by setting up foreign bases. Their union said they stood ready to prolong the strike as both sides accused the other of causing an impasse in weekend negotiations.

An extended strike could become the airline’s most serious dispute since a 10-day stoppage that disrupted France’s hosting of the World Cup soccer tournament in 1998, union leaders said.

Shares in Franco-Dutch parent Air France-KLM fell more than 3 per cent, reversing gains seen last week when the group outlined a new strategic plan focusing on an expansion of low-cost activities across Europe.

In Germany, pilot union Vereinigung Cockpit late on Monday said it had cancelled an eight-hour strike planned for Tuesday at Germany’s biggest airline Lufthansa, which would have been the fourth strike to hit the airline within three weeks.

New competition from low-cost rivals and fast-growing long-haul carriers in the Gulf has prompted European carriers to speed up restructuring measures and tweak their business models.

Alitalia is set to undergo restructuring and loss-making Finnair said last month it is taking rapid steps to cut its costs. But Lufthansa and Air France-KLM, which have both issued profit warnings in recent months, have a history of stormy relations with their powerful unions.

Air France-KLM Chief Executive Alexandre de Juniac said the strike would cost Europe’s second-largest flag carrier 10-15 m euros ($13-19 m) a day. He said it could have a damaging impact on the group’s finances, but declined to say how quickly that might happen.

So far the strike at Air France-KLM, created from a merger of French and Dutch carriers in 2004, only involves French pilots. But Dutch pilots who fly for KLM warned they could drop their traditionally conservative stand on industrial action.

In Germany, pilots cancelled a strike planned for 0700-1500 GMT on Tuesday at Lufthansa after receiving an adjusted list of demands in the ongoing row over an early retirement scheme. They want Lufthansa to maintain a scheme that allows pilots to retire early at the age of 55 and still receive up to 60 per cent of their pay before regular pension payments start.



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