PARIS (AFP) – The French government said on Sunday it has reached a deal with the European Commission allowing it to inject fresh money into flagship airline Air France, whose finances are creaking under the impact of coronavirus restrictions.
The agreement follows weeks of negotiations with the European Union’s (EU) executive, which must ensure that state aid does not give companies an unfair advantage.
“We have an outline agreement with European Commissioner Margrethe Vestager about new financial aid for Air France,” Finance Minister Bruno Le Maire said on the RTL/LCI/Le Figaro political broadcast Le Grand Jury.
Air France, of which the French government owns 14.3 per cent, will have to give up “a certain number” of slots at Orly, Paris’ second-largest airport after Charles de Gaulle, in return for the green light from Brussels, Le Maire said.
Air France posted a EUR7.1 billion loss in 2020 as its business, like that of the rest of the world’s airlines, suffered from restrictions which all but grounded global air traffic.
Le Maire would not be drawn on the amount of new funds to be given Air France, saying this was part of discussions to be held with the airline, whose board needs to vote on the deal.
Le Maire said the agreement with the Commission was “very good news for Air France and for the whole French aviation sector”, adding that negotiations had been “tough”.
The minister declined to say how many slots at Orly Air France would have to give up, but said it would be fewer than the 24 that the Commission had initially asked for.