FlightGlobal.com
Home
Premium
Archive
Video
Images
Forum
Blogs
Jobs
Shop
RSS
Email Newsletters
You are in:
Home
Aviation History
2003
2003 - 2182.PDF
AIR TRANSPORT CONSOLIDATION CHRISTINA MACKENZIE / PARIS Merger creates European giant Air France/KLM tie-up will see French airline leave state control for the first time, as KLM loses Dutch-owned status The proposed merger between Air France and KLM could create the world's largest airline by revenue, although full integration is some years off. In a deal revealed last week, the airlines agreed that by next April, assuming regulators in Europe and the USA consent, they will invite KLM's shareholders to exchange their stock for Air France stock and warrants. As well as creating an airline far larger in terms of sales (if not in passengers or fleet) than any other, the move will also see Air France finally pass out of government con trol, and KLM lose its Dutch- owned status - the first flag carrier to become foreign-controlled. The airlines expect to sign the final agreement on 15 October, after which it will be submitted for approval to the European Comm ission and the US Department of Justice. A senior Air France negotia tor says the EC has made it clear it will look favourably on the deal. The exchange offer will be launched in the first half of March and will close in mid-April, with the new organisation taking effect a few weeks later. WORLD AIRLINE Airline Air France + KLM American Airlines United Airlines Delta Air Lines Air France Northwest Airlines Continental Airline KLM Southwest Airlines Source: Airclaims C Revenue/$m 19,187 17,299 14,286 13,305 12,697 9,489 s 8,402 6,490 5,522 ^SE database; Flight Traffic/million RPK 156,568 195,897 176,121 164,267 97,151 115,963 92,191 59,417 73,081 International Airlines Top 50 Jet fleet 354 806 557 253 447 358 101 375 Air France will exchange each KLM share for 11 Air France shares and 10 Air France warrants, valuing KLM at €784 million ($878 mil lion), 40% above its cunent market value. The move will bring the French state's share of the merged airline down to 44% from 54%. Other Air France shareholders will hold 37% of Air France-KLM, leaving KLM's current shareholders with 19%. If the merger goes ahead, Air France will become a Paris-based holding company, known as Air France-KLM, with 100% ownership of KLM and a newly created com pany, which will take over the name, assets and operations of Air France. To keep KLM flying within the current system of bilateral agreements, voting rights will remain with Dutch investors for three years after the exchange is offered. A new transatlantic avia tion treaty will take at least that long to negotiate (Flight Inter national, 15-21 July). Each airline will remain respon sible for its own commercial and operational management, but a joint board will control network co-ordination and fleet strategy. Of the board of 16, seven will be French (three proposed by the French government) and three Dutch (two from KLM's board and one proposed by the Dutch government). One will be pro posed by Alitalia (a minority share holder and joint venture partner of Air France) and two by employees groups. The chairman and chief executive of Air France will become the chairman and chief executive of Air France-KLM, with KLM's chief executive becoming vice-chairman. Leo van Wijk, chief executive of KLM, says the negotiations with Air France succeeded where earlier talks with British Airways failed because there are fewer network overlaps and because there were no obstacles concerning open-skies arrangements with US partner air lines. "British Airways could not come up with the kind of proposals that we could reach with Air France," he says. DATALINKING DAVID LEARMOUNT / LONDON USA delays plans for global ATM air-ground link Long-standing US plans for an air- ground datalink to take the pressure off air traffic control voice communications look certain to be delayed. The US Federal Aviation Adminis tration is unable to confirm dates for advancing controller-pilot datalink communications (CPDLC) beyond a successful Miami-based preliminary trial. This uncertainty has led to Euro- control concern that the mutual aim of global interoperability may not be met. "The USA has yielded ATM [air traffic management] lead ership to Europe," American Airlines CPDLC manager Capt Brent Blackwell told the ATN 2003 confer ence in London, UK, in September, adding that deferrals of US commu nications programmes are "strain ing the basis for investment" by manufacturers in developing the necessary equipment. The FAA's official strategy for pro viding more voice channel space as well as CPDLC remains VHF data- link mode 3 (VDL-3), a digital radio communications system that can carry voice and CPDLC on the same signal. VDL-3 was not used for the Miami CPDLC trial, which was more a test of whether pilots and controllers liked messaging in text form - which they reported they did. The airlines used their ACARS (airline communications addressing and reporting system) datalink, nor mally used for management/opera tions messages, technical data and oceanic position reporting. The new equipment programme, known as Nexcom, is not popular with the airlines because of its cost, which, in turn, has made suppliers less keen to invest in the develop ment remaining to be completed, but the FAA insists: "We are not stopping work on Nexcom." The International Air Transport Association says it wants to start with VDL-2, and for development work on VDL-3 and the automatic- dependent surveillance-broadcast based VDL-4 to be extended to produce a more advanced successor for VDL-2. Meanwhile, US low-cost carrier Southwest Airlines has started a VDL-2 fleet-equipping plan instead of using the capacity-strapped ACARS analogue VHF datalink. Differences in the protocols Eurocontrol plans VDL-2 equipment for CPDLC and traditional radios for voice, but available radio channels have been doubled by imple menting 8.33kHz channel spacing, which has not been done in the USA. Advantages: mature technology, and system ensures total sepa ration of the voice/CPDLC modes, providing back-up if one fails; also, VDL-2 has spare capacity beyond its CPDLC role such that it can replace ACARS. US FAA plans VDL-3 digital radio combining voice and datalink in one signal. Advantages: may have a longer service life than VDL-2 when air traffic management datalink usage expands beyond CPDLC. 12 7-13 OCTOBER 2003 FLIGHT INTERNATIONAL www.fliqhtinternational.com
Sign up to
Flight Digital Magazine
Flight Print Magazine
Airline Business Magazine
E-newsletters
RSS
Events
