2/2 Entretien avec Anne Rigail, directrice générale d'Air France

One of the challenges will be to have sustainable fuels available in Europe and France in volumes compatible with our needs. That is where uncertainty is strongest. We are very pleased that the government recently announced investment and measures to grow this industry in France. We believe it also creates added value for France, energy sovereignty, and jobs. We see how fast it is developing in the United States, and it's no surprise our first contracts were signed there. The US didn't regulate, but the Biden Act put billions into creating these sustainable fuels. Production is ramping up very quickly, and American airlines will be able to use sustainable fuels that are only slightly more expensive than conventional fuels. In Europe, the price is four to eight times conventional jet fuel, and given the share of fuel in an airline's total costs, it could completely change our business models. France and Europe have defined policies and mandatory mandates, which is good because it sets direction globally, and airlines are committed to 10% SAF by 2030. Europe plays its role in regulation and vision, but there must also be support for production and purchase of these fuels, otherwise we face unfair competition. A passenger from Paris to Singapore can go direct or via Istanbul or Dubai; depending on regulations on each leg, the total cost can vary. We have warned that Europe must consider that aviation is a global industry and protect European players. Policies at the European level should not favor competitors just outside Europe like Turkey or Gulf carriers. We should also follow the American example and invest heavily in ramping up this industry. For example, biofuels from biomass will hit a limit because biomass is not infinite relative to needs. By 2030 we will need to transition to synthetic fuels. Synthetic fuels are currently hardly produced and plants are nearly non-existent. Investments are colossal, so we need strong European governmental support to bring these synthetic fuels to significant volumes. They are made from captured CO2 and hydrogen. A key issue is whether hydrogen produced from nuclear electricity is considered decarbonized. That is a major stake, especially in France where electricity is already low-carbon.

It is always a good thing to have aspirational objectives. We would be delighted the day a hydrogen aircraft exists to be able to integrate it into our fleet, same for electric aircraft. However, we also know that these aircraft will not be available for short and medium-haul routes for the next few decades. For airlines like Air France and many others, the majority of the carbon footprint is on long-haul routes: 80%. We know that neither hydrogen nor electric aircraft can meet that demand. Therefore, the main decarbonization levers for 80% of our footprint at Air France-KLM are indeed fleet renewal with more efficient aircraft, and sustainable fuels. The electric aircraft could revive regional air transport, which has shrunk a lot in Europe as many routes have been replaced by trains. The day we have fully decarbonized aircraft, we might see that business restart with a much more limited carbon footprint, but it will not address our overall goal of decarbonizing aviation, since its footprint is primarily long-haul.

I believe it's a sterile war. It has responded to the problems of the model. First, because the choice is made by customers. On domestic routes when the train takes two hours, customers already chose the train 90% of the time. We saw this on lines like Paris-Lille, Paris-Brussels, Paris-Strasbourg, which we abandoned. We had started organizing connections with TGV for medium and long-haul. So we have many TGVs from Lille to CDG, and then customers board our medium and long-haul aircraft. What is somewhat newer is a strong cooperation with SNCF to make it easier for our customers with train-to-plane connections. We are developing more connecting routes where customers can buy end-to-end tickets without waiting in line at a counter, manage a seamless digital journey. Also, and this is more complicated, we are working with Aéroport de Paris and SNCF and generally all regional train operators arriving at Roissy station on a facilitation of the physical experience: how when you get off a TGV or regional train or RER, you don't carry your heavy suitcase up stairs but immediately drop off your luggage and take a shuttle to the boarding gate. That is the aspirational objective of the airport of tomorrow.

That is part of the consolidation questions globally. We know consolidation doesn't necessarily happen during a crisis because there was aid that allowed everyone to get through it, but rather after the crisis. In some markets, the number of players can raise consolidation questions. So we look at that across all markets. But on the routes to the overseas departments, there can be three or four actors, and competition is indeed intense. It just needs to be sustainable for the competing actors.

Thank you very much, Frédéric.