Air France-KLM CEO sees upside to French airline bankruptcies

Air France-KLM boss Ben Smith Friday defended his decision not to fly to the aid of two collapsed French airlines, and said market consolidation through bankruptcies would eventually benefit the country’s aviation industry and jobs. Air France last week withdrew a rescue bid for Aigle Azur, which was formally wound down on Friday, and has since rebuffed overtures by XL Airways, another insolvent carrier. “There is going to be consolidation,” the Air France-KLM chief executive told reporters at a ceremony in Toulouse marking the delivery of Air France’s first Airbus A350 jet. “We believe positive results will come out of it, to ensure that airlines that are based here in France will be stronger to compete globally,” Smith said. “The jobs associated with those larger more powerful airlines will be created here in France.” While six airlines currently compete on London-New York routes, the smaller Paris-New York market is contested by 10 rival carriers, the CEO said. Air France now stands to pick up some of Aigle Azur’s valuable take-off and landing slots at Paris Orly airport, after a bankruptcy court rejected the last two remaining bids for the failed airline on Friday, effectively sealing its fate. <br/>