Air France-KLM: Premiumisation helps limit the impact of rising jet fuel costs
Published
Air France-KLM, the Franco-Dutch airline group, now expects a fuel bill of $9.2 billion. This sum represents a significant cost for the company, which must cope with the rise in the price of jet fuel.
To offset this additional expense, the group is relying on premiumisation. This means it is developing its upscale offers, such as business class and premium economy tickets, which cost more than economy class tickets. Passengers who choose these services bring in more revenue for the airline.
This strategy therefore helps cushion part of the shock linked to jet fuel. Sales of premium tickets help absorb the rise in costs, even though the fuel bill remains very high. For French passengers, this issue may have an indirect effect on airfares and on the services offered on board.
Air France-KLM is one of the main airlines in France. The development of its results is therefore closely followed by travellers, employees and aviation industry observers.
Sources: Le nouvel Économiste
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