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Air France-KLM makes drastic cuts in freighter capacity as losses continue

Air France-KLM Cargo has posted a third-quarter operating loss of EUR 81 million (US$89 million) down from the EUR 102 million loss in the year earlier period that was affected by a two week pilots' strike.

However, the Franco-Dutch carrier reported that revenue and traffic shrank as the carrier slashed its full-freighter capacity in a bid to return to the black, IHS Media reports.

Q3 revenue fell 6.3 per cent compared to 17.8 per cent last year to EUR 584 million from EUR 623 million.

Cargo volume was down 3.6 per cent at 301,000 tonnes compared to 312,000 tonnes last year, as full-freighter capacity was reduced by 30 per cent while belly capacity was up just 0.2 per cent.

The carrier said full freighter losses were "significantly" reduced in the quarter as it continues to reduce its exposure to the sector.

Three Boeing 747-F s were taken out of service in the 2014-15 winter season and all five MD-11, operated by the Amsterdam-based Martinair unit, will be retired by the end of 2016.

Air France-KLM plans to operate only five full freighters by the end of next year - down from 13 in 2014 and 26 when the carriers merged in 2005. This should return the freighter unit to an operating break even in 2017 from a strike-adjusted loss of EUR 95 million in 2014, the carrier said.

The third-quarter loss grew the nine-month deficit to EUR 222 million from 181 million in the year earlier period while traffic shrank 7.4 per cent to 897,000 tonnes and revenue declined by 7.8 per cent to EUR 1.8 billion.