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Air France creating lower cost airline

Associated Press logo Associated Press 3/11/2016 By Caroline Berdon

Air France plans to create a new budget airline in the hope of better competing with Mideast carriers and low-cost rivals.

The new airline would focus on routes where Air France is struggling against cheaper competition, parent company Air France-KLM said in a statement on Thursday.

It said the airline would run long-haul flights for tourist and business travel. It would use Air France pilots who volunteer to work under new rules "adapted to its competitive position". Air France staff have protested job cuts and other cost-cutting in recent years.

CEO Jean-Marc Janaillac is presenting the plan on Thursday to the works council.

In quarterly results on Thursday, Air France-KLM noted a "highly uncertain" global context and "special concern about France as a destination" after deadly extremist attacks.

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