Help needed: Air France burns billions of euros

Help needed
Air France burns billions of euros

Billions in debts, reserves are getting smaller. Air France-KLM wants new support from the French and Dutch governments. But the EU Commission attaches certain conditions.

Air France KLM needs fresh money. The airline, battered by the corona crisis, slipped deep into the red in 2020 and has to cope with a loss of 7.1 billion euros.

Air France-KLM 4.78

It does not look like the situation will improve noticeably quickly: In view of the ongoing travel restrictions, the Executive Board expects business to remain difficult at the beginning of the new year. He assumes that the airline will only achieve 40 percent of its pre-crisis capacities in the first quarter. But then things should slowly improve. "The airlines in the group will gradually increase their capacities by the summer of 2021", it said in a statement. In the second and third quarters, there should be a recovery with the help of the vaccinations.

The airline's financial situation is tense. At the end of 2020, Air-France-KLM had liquidity and credit lines of 9.8 billion euros. Three months earlier it was 12.4 billion euros. In addition, the group is in debt with 11 billion euros.

The board is therefore negotiating with the French and Dutch governments and the EU Commission about a further rescue package. Last year, Paris and The Hague supported the airline with 10.4 billion euros. The governments have signaled to help the company again. Brussels, however, demands that Air France KLM waive take-off and landing rights – for example in Paris – in return.

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