Air France earlier this week announced 2,800 additional job cuts in 2014, which now will total nearly 8,000 positions eliminated once the Transform 2015 recovery program, that announced 5,100 job cuts in 2011, is fully implemented. The carrier has also deferred two A380 deliveries to 2016 or beyond, and announced that it will phase out the Boeing 747 fleet beginning in 2016, four years earlier than expected, for both passenger and freighter models. The 747-400s will be replaced by more efficient twin engine A350 and 777 models in the Air France fleet.
While the company recently took delivery of its 9th A380, the deferral of the last two aircraft may be indicative of a lack of adequate traffic in markets that the carrier had planned to serve with these very large aircraft. It appears that Air France is looking closely at capacity in several markets, and looking to right size the fleet to fit market demand rather than to attempt to stimulate demand with lower yields.
While the deferral is not good news for the A380, a positive is that the backlog for the aircraft still will accommodate several years of additional production, and the two deferred aircraft should be easily placed with other customers. The bad news, of course, is that demand still has not emerged to justify an increase in the production rate at Airbus, which will likely face a net reduction in backlog this year for the A380, delivering 30 with orders for only 20 so far (Doric). After 7 years in service, the aircraft should now be nearing its market peak. But with orders languishing and new competition from 777-9, 787-10 and A350-1000 emerging with equal or better seat-mile costs, a dramatic product improvement in the form of a re-engining or fuselage stretch may be needed to revive interest in the A380 program.