Air France alarmed by decline in traffic

DECLINES in traffic and revenues at Air France were deeply worrying, Bernard Attali, chairman of the state-owned airline, admitted yesterday, writes Mary Fagan.

Mr Attali said passenger traffic declined by 0.6 per cent in the first seven weeks of the year, while revenues fell by 2 per cent in January alone as the result of fare wars. Although no more cost-cutting measures were imminent, the company 'remains vigilant'.

Mr Attali urged the French government to take a firm stance in negotiations with the United States on the travel sector. France last year renounced the 1946 bilateral treaty governing air travel between the two countries, triggering negotiations over a new treaty. Talks between the two governments resumed yesterday.

Mr Attali said France needed a pact along the lines of that between Britain and the US. He has complained in the past that British Airways is in effect protected from transatlantic competition through the US-UK agreement. Now he is asking the French government to impose much tighter restrictions on the ability of US airlines to expand in France.

Mr Attali has also been an outspoken critic of BA's takeover of Dan-Air and of the British airline's acquisition of a stake in the French domestic airline TAT.