Air France shares nosedive after CEO bails



However, pilots, cabin crew and ground staff were on strike for a fourteenth day since February on Monday and Air France said one in five flights would be canceled on Tuesday.

Air France-KLM reported a net loss of €269m (£238m) in the first quarter of the year.

Air France had offered workers a salary increase of 2 percent in 2018 and a further 5 percent over the following three years, but French unions, which have demanded 5.1 percent this year, have complained management is not serious about talks.

Air France stock closed 9.8 percent lower at 7.30 euros, having earlier traded as low as 6.93.

The French government owns 14.3% of the Air France-KLM parent group.

Philippe Evain, president of the French SNPL pilot union, told RTL radio Monday he was "shocked" by Le Maire's comments, adding that "the survival of Air France is not in question".

Janaillac had the support of Bruno Le Maire, France's economy minister who supports Air France management.

Apart from the French government, other big investors in Air France-KLM include Delta Air Lines and China Eastern Airlines, which each own a stake worth 8.8%, according to FactSet data.

Mr Janaillac's move came after staff at the loss-making airline rejected a new pay deal and continued their industrial action in pursuit of a 5.1% pay rise.

While airlines from Deutsche Lufthansa AG to British Airways - and lately even low-priced specialist Ryanair Holdings Plc - have all had their share of corporate dysfunction brought on by strikes, none has suffered to the extent as Air France. "The challenge is the survival of the company, which may disappear if it does not make the necessary competitiveness efforts", he added.

Regardless of the strike, the carrier demanded that it is ready to keep up 99% of whole deal flights on Monday, 80% of medium-pull administrations and 87% of short-pull flights.

Societe Generale analysts said the company's employees "have not only forced the group CEO to resign, but also made the investment case obsolete".

At the request of the board of directors, Janaillac will remain in his role as CEO and Chairman until the end of the company AGM on May 15 when "an interim governance solution" will be announced.

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