Air France-KLM shares slump as CEO bows out

Shares in Air France-KLM fell the most since 2014, as the surprise exit of chief executive Alexandre de Juniac after just three years in the top job created a power vacuum that puts Europe’s biggest carrier at the mercy of unions implacably opposed to cost-cutting plans.

Air France-KLM shares slump as CEO bows out

The stock slumped as much as 8.6% as the announcement of Mr de Juniac’s departure, a year after he secured a new contract, leaves Air France-KLM rudderless.

The shares later rallied to pare losses to a 3% drop on the day. They are still up 13% this year and values the airline at €2.38bn.

Mr de Juniac, who will leave by August to run the International Air Transport Association, said his successor must press on with restructuring plans while finding a way to win pilot backing.

Analysts say his exit at just 53 comes as a blow after he helped Air France-KLM snap four years of losses in 2015.

“We expect no more progress with unions in 2016,” Kepler Chevreux analyst Ruxandra Haradau-Doser said, adding that Mr de Juniac’s departure is “clearly negative news”.

Mr de Juniac had sought to build his strategy around shifting short-haul Air France flights that don’t connect with lucrative long-haul trips.

Labour grief culminated in violence last October, when senior managers fled a works council meeting over a fence with their clothing in shreds.

Bloomberg

More in this section

Puzzles logo

Puzzles hub

Visit our brain gym where you will find simple and cryptic crosswords, sudoku puzzles and much more. Updated at midnight every day.

Lunchtime
News Wrap

A lunchtime summary of content highlights on the Irish Examiner website. Delivered at 1pm each day.

Sign up
Revoiced
Newsletter

Our Covid-free newsletter brings together some of the best bits from irishexaminer.com, as chosen by our editor, direct to your inbox every Monday.

Sign up