* Bookings down by up to 10 pct in latter part of year
* Demand from China, Japan, U.S. especially weak
* Adds to pressure on new CEO, new project due in Nov
(Adds comment on low-cost long-haul)
PARIS, Sept 20 Air France shares hit
their lowest in four years on Tuesday after the airline's boss
Jean-Marc Janaillac said it expected a further decline in
bookings in the coming months as a result of Islamist militant
attacks and a cabin crew strike.
Militant attacks in France have hit tourism in the country
since last year. In July, a gunman drove a truck into crowds
celebrating Bastille Day in the Riviera city of Nice, killing 86
people. Later the same month, a priest had his throat slit in a
church. Both were claimed by Islamic State.
"We can see the effect on Air France already, we will feel
it even more in the coming months," said Janaillac, who is head
of the Franco-Dutch Air France-KLM group, of which Air France
forms the major part.
Air France's bookings were down 5 percent in July and August
and the drop had accelerated to between 5 and 10 percent for the
remainder of the year, Janaillac said at a travel conference in
Paris. He said the biggest drop in demand was coming from
travellers from China, Japan and the United States.
Air France shares closed down 2.7 percent at 4.66 euros,
while rivals IAG, Lufthansa, Ryanair
and easyJet were down by between 1 and 3 percent.
Shares were also knocked after HSBC kept a "Reduce" rating
across the European airline sector on Tuesday, saying the sector
was facing a cyclical downturn.
The slump in ticket sales piles more pressure on Janaillac,
who took over in July, to turn around the group, which has
struggled to cut costs to compete more effectively with low-cost
rivals on short-haul flights and Gulf carriers on long-haul.
The company also said on Tuesday it would delay taking its
first Airbus A350 long-haul jet by one year, to the end
of 2019. It did not give a reason for the delay.
When asked about a move into low-cost long-haul to counter
new entrants to the market such as Norwegian and Lufthansa's
Eurowings, Janaillac said the company was looking at its
"We don't have any definite plans, but we are studying all
the possible ways of responding to this new trend of low-cost
long-haul carriers," he said.
After plans by previous CEO Alexandre de Juniac met with
fierce resistance from unions and resulted in costly strikes,
Janaillac hopes to smooth relations and plans to launch a new
project called "Trust Together" in early November.
"We have to restore trust within the group, that's my aim
with this project for the future that we're working on,"
Rival Lufthansa has also faced strikes as it tries to cut
(Reporting by Gilles Guillaume; Writing by Andrew Callus and
Victoria Bryan. Editing by Jane Merriman)