Air France CEO resigns after employees reject wage offer

  • Air France CEO resigns after employees reject wage offer

Air France CEO resigns after employees reject wage offer

France's finance minister, Bruno Le Maire, told CNN affiliate BFMTV on Sunday that the labor dispute "threatens the survival of Air France".

Unionised staff are set to walk out for the 14th day on Monday as they press for a 5.1 percent salary increase this year as the company recovers from years of losses and restructuring.

"Air France-KLM is now without a boss and will find it hugely hard to attract a high-level manager", analysts at French brokerage Aurel-BGC said.

Air France's share price has dived after its chief executive quit and the French government warned that the country's flagship carrier might collapse.

"Be responsible. The survival of Air France is in the balance", he added.

'Air France will disappear if it does not make the necessary efforts to be competitive, ' he warned.

On Monday, the company's shares went into tailspin on the Paris stock exchange on Monday, falling by 13 percent after the French finance minister's statements, and following the resignation of the company's CEO on Friday.

Air France-KLM shares fell as much as 14.3 per cent to an intraday low of 6.93 euros ($8.30) in early trading, around at their lowest level since April 2017. On medium-haul flights to and from Paris-Charles de Gaulle, the percentage drops to 80%, while it expects to operate 87% of short-haul flights to and from Paris-Orly and the rest of the regional airports.

It was estimated that 14.2 percent of pilots would be taking part in the strike, as well as 18.1 percent of flight crews and 10 percent of ground staff, according to Air France management. The industrial dispute come as separate strikes over Mr Macron's labour reforms are hitting France's national railways.

The airline said: "Air France deplores the continuation of these strikes even though the period that opens does not allow to pursue any negotiation".

Others, including the more moderate CFDT union, which had urged Air France to back management's pay proposal, warned that "dialogue was blocked" and said the SNPL was too inflexible. Mr Janaillac had put his job on the line as workers voted on a pay offer by management, a bet he lost as staff rejected the proposal late on Friday.