Air France 2013 Annual Report Download - page 34

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AIR FRANCE-KLM ANNUAL REPORT 2013 OUR DESTINATIONS
Solid and strategic partnerships
Air France-KLM supplements this organic growth
in long-haul through strategic partnerships with
other airlines. Code-sharing arrangements enable
the Group to expand its network by enabling
customers to fly with partner airlines. In each world
region, the Group thus engages in exclusive
cooperation with major operators and is increasing
its exposure to growing markets.
This co-operation strategy is notably illustrated by
the trans-Atlantic joint-venture with Delta and Alitalia.
With more than 250 daily flights, this joint-venture
operates 23% of the total capacity on trans-Atlantic
flights and generated $12.5 billion of 2013 revenues.
In 2013, Air France-KLM extended its co-operation
agreement with the UAE carrier Etihad, with which
it operates 44 destinations under code share, and
announced an extension to the agreement with
Kenya Airways which should further strengthen its
presence in Africa.
In 2014, the signature of a long-term strategic
partnership with the Brazilian airline GOL should
support the Group’s growth in Latin America by
giving it exclusive access to the domestic network
of one of the region’s main operators.
Powerful and efficient hubs
At Paris-Charles de Gaulle, Air France operates
the most powerful hub in Europe in terms of
connections between medium and long-haul.
Achieving streamlined, optimized flight connections
is also fundamental for KLM in that 70% of its
customers transfer flights at the Amsterdam-
Schiphol hub. The Group’s flight schedule is thus
organized around six or seven waves or “banks”
spread throughout the day, enabling a maximum
number of connections from these hubs within
the shortest possible time. The dual hubs of
Paris-Charles de Gaulle and Amsterdam-Schiphol
alone offer approaching 28,000 transfer
opportunities between medium-haul and long-haul,
or vice versa, in under two hours.
Rationalizing the medium-haul operations
While the European economic environment remains
sluggish, the Group is implementing a pro-active
strategy aimed at improving productivity in its
medium-haul network. The operational measures
include reducing aircraft turnaround times and
optimizing fleet utilization.
The Group is also adapting its point-to-point activity
and divesting its CityJet subsidiary.
All of these measures enable a reduction in unit
costs and a redeployment of capacity on departure
from the hubs. In Summer 2014, Air France will
launch a new service to Stavanger, the center of the
Norwegian petroleum industry. For its part, having
introduced a service to Florence (Italy) in Winter
2013, KLM will start operations to Bilbao (Spain),
Turin (Italy) and Zagreb (Croatia) this summer.
In addition to the more targeted redeployment of
the fleet, an in-depth revision in tariff structures with
the introduction of the Mini fares at Air France and
payment for a first piece of hold baggage at KLM
are contributing to a new revenue dynamic. The
successful launch of the new regional airline HOP!
and the growth of the Transavia France subsidiary,
specialized in leisure destinations, complete the
Group’s offer by addressing each customer segment
with an adapted offering