January 29, 2013 / 9:58 AM / 5 years ago

Air France-KLM launches low-cost airline Hop!

PARIS (Reuters) - Franco-Dutch group Air France-KLM (AIRF.PA) has formed a new French regional airline unit called Hop! to respond to competition from low-cost rivals.

Hop! will operate 530 daily flights to 136 destinations in Europe from March 31 with one-way fares from 55 euros, the company said on Monday.

The launch of the new airline - which has been created through the merger of regional units Brit Air, Regional Air and Airlinair - is part of a reshuffle of the group's loss-making short and medium-haul operations.

Under a three-year plan dubbed "Transform 2015," Air France- KLM is seeking to cut costs to pay back debt. It will cut 5,000 jobs to turn around its short and medium-haul business, which lost 700 million euros in 2011.

Earlier this month, the carrier unveiled a lower-cost tariff, dubbed "MiNi," targeting people who travel light, another move aimed at reviving its loss-making short and medium-haul routes. (Reporting by Elena Berton; Editing by Dan Lalor)

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