In this Feb. 9, 2017, photo Benjamin Smith, President, Passenger Airlines Air Canada, speaks before revealing the new Air Canada Boeing 787-8 Dreamliner at a hangar at the Toronto Pearson International Airport in Mississauga, Ontario. Air Canada's chief operating officer Smith has been named the new CEO of Air France-KLM. Smith will replace former Air France CEO Jean-Marc Janaillac, who quit more than three months ago when staff turned down his offer of a pay deal aimed at halting a wave of strikes. (Mark Blinch/The Canadian Press via AP)

Benjamin Smith new CEO of Air France-KLM, unions concerned

August 17, 2018 - 6:05 am

PARIS (AP) — Air France-KLM has named Benjamin Smith, formerly a top executive at Air Canada, as its new CEO and unions said Friday they were concerned he would cut back on wages and work conditions.

The company has announced Thursday that Smith, who is 46 and was previously Air Canada's chief operating officer, will fill the role by Sept. 30.

Vincent Salles, union official at CGT-Air France union, said Friday on France Info radio that unions fear Smith's mission is to implement plans that would "deteriorate working conditions and wages."

Unions also have expressed concerns that he would tend to expand the company's low cost subsidiaries instead of developing Air France's main brand.

Smith becomes the first foreign CEO in the company's history, which has also sparked criticism from unions.

Nine unions objected to the appointment of a foreigner in the name of "the defense of our national airline's interests," in a joint statement issued before the board decision.

Union representatives are to gather on Aug. 27 to discuss potential strike actions.

The previous CEO, Jean-Marc Janaillac, resigned in May after Air France employees held 13 days of strike over pay and rejected the company's wage proposal, considered too low.

Unions are seeking a 6 percent pay rise. Crews and ground staff wages have been frozen since 2011.

The company estimates the strike cost it 335 million euros ($381 million) in the first half of the year.

Smith said he is "well aware of the competitive challenges" the group is facing. "I am convinced that the airlines' teams have all the strengths to succeed in the global airline market," he said in an Air France-KLM statement.

Finance Minister Bruno Le Maire said Smith's arrival was an "opportunity" for Air France-KLM and expressed his confidence in the new CEO's ability to "re-establish social dialogue." The French state holds a 14.3 percent stake in the company.

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