Air France hit by strikes

An air traffic controllers' strike led France's aviation authority to advise carriers to cut flights.

Air France, which is battling the expansion of Gulf airlines abroad, was hit by flight cancellations at home yesterday because of a new wave of nationwide labour strikes. An air traffic controllers' strike led France's aviation authority to advise carriers to cut half of their flights to and from Paris-Orly Airport and a third to and from Paris-Charles de Gaulle Airport.

While Air France said the latest one-day protest would not affect its long-haul flights, it acknowledged that some European and domestic flights were cancelled or delayed. Unrest is brewing between the French government and unions over proposals to reform the pension system, driving workers in the energy, education and transport sectors to undertake a series of strikes across the country since the start of last month.

The news comes as the airline's chief executive Pierre-Henri Gourgeon has thrown down the gauntlet to the fast-expanding Gulf airlines and said Europe's place as an aviation centre was vital to defend. The latest salvo in a long-running dispute centres on export credit assistance but other criticisms lodged against Middle Eastern carriers have included their lack of corporate taxes, as well as cheaper labour costs and landing fees.

In response, Emirates Airline officials have said they pay "social costs" for the firm's employees that amounted to US$600 million (Dh2.2 billion) worth of housing, medical and educational stipends. "Those guys don't have to think about that," Sir Maurice Flanagan, the executive vice chairman of Emirates Group, said earlier this year. Air France officials have asked for a "level playing field" in their fight against the well-funded Middle East airlines and the labour strikes in France may serve to heighten their concerns. Labour unions and strikes are not permitted among UAE companies such as the nation's flag carriers.

The Centre for Asia-Pacific Aviation (CAPA) noted that the aviation industry was a "heavily regulated, nationalistic anachronism" and has in the past singled out Air France's level of state-support for criticism. "European carriers have, for some time, been getting upset over allegations of government funding, which is pretty funny coming from Air France," Peter Harbison, the executive chairman of CAPA, said in 2008.

Earlier this year, La Tribune newspaper reported Emirates had been rejected by the French government in its requests to obtain more landing slots in Paris and received only one new slot - for its Dubai-to-Lyon service. * with Bloomberg [e-mail]