Air France shares down nearly 13 percent after CEO quits

Air France shares down nearly 13 percent after CEO quits

Mr Janaillac's move came after staff at the loss-making airline rejected a new pay deal and continued their industrial action in pursuit of a 5.1% pay rise.

France's finance minister, Bruno Le Maire, told CNN affiliate BFMTV on Sunday that the labor dispute "threatens the survival of Air France".

Since the 2004 merger with the Dutch KLM carrier, Air France has been unable to return to profitability.

On Friday, Air France-KLM CEO Jean-Marc Janaillac handed in his resignation to the executive board after the staff rejected a final pay offer from him.

Despite the strike, the company says it will be able to maintain 99 percent of long-haul flights on Monday, 80 percent of medium-haul and 87 percent of short-haul.

Paris - Air France KLM shares slumped on Monday after the company's CEO said he would resign following the rejection of a pay deal by the airline's staff. There have been strikes at the SNCF rail organization too.

Others, including the more moderate CFDT union, which had urged Air France to back management's pay proposal, warned that "dialogue was blocked" and said the SNPL was too inflexible.

"Air France will disappear if it does not make the necessary efforts to be competitive", he warned, ruling out any government intervention to purge the company's debts.

Over the first quarter of 2018, the company posted €269 million in losses, up from €33 million during the same period previous year.

The group has already downgraded expectations of its financial performance for 2018. Air France-KLM has a 12-month low of $8.63 and a 12-month high of $17.28. The joint company flies tens of millions of passengers around the world every year.

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