Air France’s new boss flies into immediate strike threat

PARIS: The first non-French boss of Air FranceKLM, Canada’s Ben Smith, faces a rocky landing at the strike-prone airline where his nomination and pay packet have been sharply criticized by French trade unions. Smith, the current number two at Air Canada, was unveiled Thursday as the new chief executive of the Franco-Dutch group, whose last boss quit during an ongoing labor dispute as staff press for higher wages.

The French government, which has a 14.3-percent stake in the airline, said attracting “a leader of this stature who has great experience acquired through 19 years with Air Canada” was “a boon” for the airline. But no sooner had the 46-year-old been named than he became embroiled in controversy over his salary, which could be several multiples that of his predecessor Jean-Marc Janaillac, according to a source close to the airline.

The source told AFP his annual pay could reach up to 4.25 million euros ($4.8 million), consisting of a fixed wage of 900,000 euros — 50 percent higher than his predecessor-as well as performance-based bonuses and shares which will be dependent on results.

Former CEO Jean-Marc Janaillac took home 1.122 million euros in 2017, based on a fixed salary of 600,000 euros and bonuses.

The CFDT union called the reported pay hike “unreasonable”, echoing criticism from other unions, while French politicians across the spectrum were drawn into the debate about executive pay.

Olivier Dartigolles, a spokesman for the French Communist party, said the package was “shameful” and said Smith “would be the person explaining to employees that they need to make moderate salary demands”.

Fears of further strikes from staff, who have seen their call for a five percent pay hike this year turned down by management, saw investors take fright on Friday with shares down heavily on the Paris stock exchange. The fall was due to “fears of a strike forming that would affect the profitability of the airline,” an analyst at financial trading group IG France, Alexandre Baradez, told AFP.

— AFP PARIS: Travellers and an Air France Airbus A380 aircraft at Roissy-Charles de Gaulle Airport, north of Paris. Air France-KLM named Benjamin Smith of Air Canada as its new chief executive, the first non-French head of the group despite resistance from its powerful trade union.