TAT president Marc Rochet prepares to lead British Airways' challenge in France.
By the beginning of 1997, Marc Rochet, president since August of British Airways French subsidiary TAT, is likely to find himself president of the largest privately owned airline grouping in France. He is set to take over the running of Air Liberté at the end of December - pending final judicial approval of the BAbid (now delayed from the middle of December).
Rochet is unflustered by the enormous task of competing with the ever-stronger Air France group when Air Liberté is virtually bankrupt and TAT is still losing money. "We're going to relaunch Air Liberté in the spring and, by the end of the summer, we expect that it will be in good shape. We will further reduce TAT's losses this year, and we're targeting next summer to reach break-even," he says.
He is a veteran of airline restructuring, having overseen the recovery of French independents Air Guadeloupe, EAS and Aeromaritime between 1976 and 1988. In 1991 he tackled the merger of Air Outre-Mer and Minerve to create AOM. When Rochet took over AOM, the airline employed 1,000 people and was making a loss of Fr700 million ($140 million) on sales of Fr1.1 billion. By 1995, he says, AOM employed 2,000 people, had sales of Fr3.2 million and made a profit of Fr30 million.
Rochet is clear about his mandate from BA on how the two airlines must present themselves in the French domestic market. "We are a French team, aiming to increase our market share in France, but we are also part of the British Airways global strategy," he says. This means that he is expected to implement the UK airline's rigorous cost controls and its emphasis on customer service. Rochet stresses, however, that there is "no question" of marketing either carrier under BA colours. "We will develop them as French airlines-it is better not to try and import a new culture," he adds.
TAT and Air Liberté "-may be merged one day", says Rochet, "-but not until we have put Air Liberté on a firm footing". On this, he says, there is "-plenty to do". The airline he inherited from ex-president Lotfi Belhassine, and which was put under the jurisdiction of the French commercial court in September, was "-not well organised", he says. "Because they tried to grow too fast, their cost control was not rigorous enough. We're working very hard on that now," he adds. He notes that, while Air Liberté had sales of Fr2 billion in its last full year (1995/6), "-it lost Fr900 million. That's 45% of their revenue gone".
Rochet plans to eliminate immediately up to 100 full-time jobs from the Air Liberté workforce of 1,450. "It is very unfortunate, but we are simply not in a position to maintain them," he says.
The airline's fleet will also be rationalised. He notes that the French "-have a penchant for complexity", when it comes to airline fleets. "When I took over AOM, they had five aircraft types. When I left they had two," says Rochet.
Similar plans are in hand for Air Liberté, whose fleet will also be reduced to two types. Its leased Boeing 737-200s will be exchanged for McDonnell Douglas (MDC) MD-83s, which will be added to the seven it now operates. Its four (leased) Airbuses have been discarded, leaving it three MDC DC-10-30s with which to operate long- distance routes to the French Caribbean. "We will also concentrate on charter services, to improve aircraft utilisation," says Rochet.
Attitudes to customer service in France are changing slowly, but tangibly, says Rochet. "We're a long way from the days when Air Inter staff went on strike over the introduction of an on-board coffee service," he adds. The unions might be aware that the customer is important, "-but they still don't seem to have changed their minds about productivity and cost levels".
Rochet believes that the French air-transport system has been dominated for too long by state-owned Air France, with the struggling independent-airline industry suffering blatant attempts to undermine competition by manipulation of slot allocation and airport access. "Things will be much better when Air France has been privatised," he says, "because, then, we will all compete equally on a level playing field."
Of the recently launched Air France Europe high-frequency "shuttle" domestic services, Rochet believes that "-they are simply trying to kill the competition", but adds that he remains "unworried". The TAT service between Paris Orly and Marseille has been terminated because, with slots at Orly sufficient only to provide nine flights a day, TAT could not compete with Air France's tally of 26. TAT and Air Liberté have now combined their respective flights between Orly and Toulouse, to provide 18 daily services. "We intend to fight this route because we have lower costs and can provide a better service. I don't think they can sustain those frequencies for long," he says.
Rochet, who comes from the Cognac region of France, is clearly ready to face the battles ahead. "I'm totally confident Air France cannot kill us", he says.
Source: Flight International