Air France will reduce capacity on its short-haul network in response to growing competition from high-speed rail and low-cost carriers.
The airline announced plans to cut short-haul capacity by 15 percent—measured in available seat kilometers—by the end of 2021.
Air France reported a $210 million loss on its domestic network last year and has accumulated losses exceeding $779 million in this segment since 2013. The carrier attributes much of this decline to the expansion of the high-speed TGV network, which has increased service frequency, shortened travel times and established a highly competitive low-cost alternative for many domestic journeys.
On routes where high-speed trains connect Paris with regional cities in under two hours, Air France says it has lost roughly 90 percent of its market share.
At the same time, low-cost airlines such as easyJet and Ryanair have intensified the pressure. Air France notes these competitors have rapidly expanded by opening bases at major airports and pursuing aggressive pricing strategies, often supported by local public authorities.
The carrier also highlighted differences in employment models: while about 90 percent of Air France staff are based in France, many low-cost rivals have not contributed in the same way to regional employment, frequently using the flexibility afforded by the European labor market to base employees in jurisdictions with lower labor costs.
Faced with these structural challenges—faster rail connections, sharply competitive pricing from low-cost operators and differing labor models—Air France says the capacity reduction is a necessary adjustment to better align supply with current demand on short-haul domestic and regional routes.