Air France 2008 Annual Report Download - page 17

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17
A high oil price over the long term
For the first time in the history of air transportation, jet fuel
has become the largest cost item for airlines. Whereas it
had amounted to an annual cost of around $40 billion in
the early 2000s, equivalent to around 10% of operating
expenses, IATA estimates show it reaching more than
$230 billion in 2008, based on an oil price of $130 per
barrel, and representing some 40% of operating expenses.
Thanks to its hedging strategy and investment in more
efficient aircraft, the Air France-KLM Group is better
positioned than other players in terms of limiting the
impact of higher oil prices.
Environmental responsibility
Air transportation, which has always been subject to
significant constraints (safety, regulatory compliance,
infrastructure, taxation), must now meet increasingly
demanding environmental standards and help to combat
global warming. The Air France-KLM Group works to
reduce its greenhouse gas emissions through the various
initiatives in its Climate Action Plan. Air France and KLM
have deployed separate but harmonized environmental
management systems, based on the 14001 standard.
Thus, the two environmental divisions work together on a
range of issues and carry out common environmental
reporting through the Group’s Corporate Social
Responsibility Report.
France French Environmental Summit (Grenelle)
Anti-growth lobby
ETS: inclusion of air transportation in 2012
Europe Flight curfews
Ecotaxes
Kyoto protocol
International Work of the IPCC
ICAO recommendations
150
140
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50 50 60 70 80 90 100 110 120 130 140 150
Market price
Air France-KLM
final purchase
price in 2008-09
Air France-KLM
final purchase
price in 2009-10
The Air France-KLM Group benefits from the fuel hedging strategy in place
for nearly a decade, which reduces the negative impact of price rises and
ensures the cost remains constant over the financial year.
An effective fuel hedging strategy
In $/bl
In $/bl