Air France-KLM on airline competition: ‘The Gulf carriers are leading the show’

Laurent Fesselier, a commercial director at Air France-KLM, and Eugénie Audebert, Air France’s business customer experience manager, explain the French carrier’s strategy for staying competitive.

Laurent Fesselier, Air France-KLM’s commercial director for an area stretching from Lebanon to India, has a startling admission: “The Gulf carriers are now leading the show.” But in a recent interview on a foggy morning in Air France’s flagship business lounge at Paris-Charles de Gaulle airport, he and Eugénie Audebert, Air France’s business customer experience manager, explained the French carrier’s strategy for staying competitive.

What are Air France’s competitive advantages vis à vis the Arabian Gulf carriers?

Fesselier: We have a lot of experience. We have been able to develop a huge worldwide network. We have the blessing to be based in Paris, in France. In terms of advantages in our mindset, we are really willing to keep on moving forward and to innovate. We know if we want to keep on rolling, we need to keep on investing and innovate.

What was the process for improving Air France’s business class (refurbished planes began flying the Dubai-Paris route in February)?

Audebert: It was a work in collaboration with the customer at several stages. It took four years. We wanted of course to offer a full-flat bed, but to go further and to really reach the best standard of the industry for the seats.

What about price?

Audebert: Our objective was to provide a better product but no price increases.

The Gulf carriers have bought many new planes in recent years. Do you plan on buying more aircraft?

Audebert: It's true that they are investing a lot and buying a lot of aircraft. The next aircraft for Air France and KLM will be the 787 that will enter in service next year — this year for KLM, next year for Air France. But it's true that their logic is quite different, because they are able to invest in a lot of new aircraft. Our fleet is on average quite young, so we are still good at this point.

Fesselier: We will use it in Abu Dhabi right away for KLM, the 787 will fly Amsterdam-Abu Dhabi.

How can Air France-KLM expand in the Middle East at a time when it is being forced to cut costs?

Fesselier: Alliances and partnerships are important to us when it comes to supporting network growth without additional investment in fleets. We have these partnerships in the region with carriers from the UAE, Lebanon and Saudi Arabia and can therefore offer our customers more frequencies and more destinations they can seamlessly fly to.

Your new English-language marketing slogan is “France is in the air”. How meaningful is the airline’s French character?

Fesselier: Air France, we definitely want to bring the French touch. Nobody can do it. Try us. Come on us. We will never be an Arabic airline, never, we will never be a Chinese airline. We are a Franco-Dutch airline. That's absolutely key.

Audebert: It is continuous investment in the product, in the experience to really have the feeling "recevoir à la française". We really want to show and to give this experience to the customer, the French touch.

Final thoughts?

Fesselier: You might wonder, why Dubai? Because Dubai is working. For Air France-KLM it's working pretty well. We have increased our revenue again in 2014 — the business cabin is really leading us. We are totally aware of the competition in the area — UAE, Qatar, Turkey. We are very confident. We are here to stay. There is a clear focus on Dubai from the top management and from the company. We have more and more loyal customers.

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