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Air France KLM SWOT & PESTLE Analysis

ID : 52131053| Aug 2019

COMPANY PROFILE -Air France KLM

Business Sector :Aviation

Operating Geography :Europe, France, Global

About Air France KLM :

Air France was founded in October 1933 by a merger of Air Orient, Air /union, CIDNA and SGTA. Prior to its merger with KLM in 2003, it served as the national flag carrier of France. It has three core businesses: passenger operations, cargo (freight transport) and maintenance (aircraft repair and maintenance). Its most powerful hub is at Paris-Charles de Gaulle and is a member of the SkyTeam, which is a global airlines alliance with 20 members. The mission of Air France KLM is to provide its customers a high quality service adaptable to their changing needs. The overall vision is to become the world's biggest and leading airline company.

Air France KLM Revenue :

2,484.6 crores EUR (2016)

Competitive Analysis of Air France KLM

SWOT
PESTLE
The SWOT analysis for Air France is presented below:
Strengths
Weaknesses
1. Wide network of airlines serving a large number of nations
2. Good branding and marketing through huge presence on social media
3. Most powerful hub in Europe
4. Strong tie ups
1. High level of economic uncertainties
2. Persistently weak demand
3. Cabin crew strike
4. Intense Competition
Opportunities
Threats
1. Increase in the capacity of airline industry
2. Decrease in fuel bills
3. Net reduction in the overall debt
4. Transavia is the top level low cost carrier in Netherlands and Paris
1. Terrorist attacks in Europe
2. Continuing pressure on unit revenues
3. Voluntary departure plan
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Detailed SWOT Analysis of Air France KLM

 

Strength

1. Wide network of airlines serving a large number of nations: Air France currently operates in 89 countries and serves 178 destinations worldwide. As of March 2016, the fleet size of the company is 331.

2. Good branding and marketing through huge presence on social media: Air France has a huge presence on social media especially Twitter, YouTube and Facebook. Some of the ads by Air France have reached over 1 million views on YouTube. The company has over 2.5 lakhs followers on Twitter and about 65 lakhs followers on Facebook.

3. Most powerful hub in Europe: Air France operates a hub at Paris-Charles de Gaulle, which is the most powerful hub in Europe in terms of connections and offers over 18,000 opportunities of connection between medium-haul flights and long-haul, and vice-versa, in less than two hours.

4. Strong tie ups: Air France has various tie ups which helps in delivering better services to the customers. One such tie up is with SNCF through which passengers can book and check in for their respective flights at railways stations itself.

Weakness

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Opportunity

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Threat

1. Terrorist attacks in Europe: The recent terrorist attacks in Europe have hampered the local flows to France. All this has lead to a growing concern about having France as a destination.

2. Continuing pressure on unit revenues: There was a continued reduction in the unit cost which was around 1% in 2016 and the ex- fuel unit costs were down by 2.3% at a constant currency. Also, the ongoing restructuring on track will reach full freighter breakeven in 2017.

3. Voluntary departure plan: In order to balance the weak revenue trends that developed during the December 2014, a voluntary departure plan has been formed which will cut another 800 positions in Air France.

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Air France KLM SWOT and PESTLE analysis has been conducted by and reviewed by senior analysts from Barakaat Consulting.

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Air France KLM SWOT & PESTLE Analysis
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