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AIR FRANCE EXPANDS PARIS HUB

The future lies in the East. This might be Air France's motto for two reasons. On the one hand, to the east of France most European transfer passengers have chosen the Frankfurt hub and Lufthansa is dominating business there. Naturally the French want to change this situation. In order to achieve this they are, on the other hand, urging developments towards the East - in this case the East of their home airport Charles de Gaulle in Roissy, situated north of Paris. There are endless possibilities for the future such as a plentiful of available space. In the fight for a top rank among the European airlines this area is worth its weight in gold because there is no room for expansion on any of the other large European airports and they are all bursting at the seams. Everywhere growth is hindered, because terminals are too small, or there are too few of them. Furthermore runways are too short or are situated to close together. London-Heathrow, Frankfurt and Amsterdam are bemoaning the same dire situation. Other European airports and airlines can only dream of the pace at which things at Paris-Roissy are changing.

A short look at the history of this airport: On 8 March 1974 the then world's second largest airport after Dallas-Fort Worth with a total area 332km2 started operating. After construction projects which took about seven years, passengers have a terminal at their disposal, which looks like a giant concrete camembert. It consists of a central circular building with a diameter of 220 meters and is ten floors high. Seven satellites with four gates each are situated around the central building, which has an annual capacity for twelve million passengers. Air France only moved from Orly Airport in the South to Roissy, when the first two oval modules of terminal 2 were completed in 1981/82. The two modules A and B, which are facing each other, are each designed for five million passengers annually. Their modus operandi is radically different from the way things are run at Terminal 1.

There is furthermore an area measuring 1,700 x 800 meters, which had already been set aside for a later expansion. There is the distinct possibility to handle up to 90 million passengers per annum in a final expansion stage. However, it took a long time to construct two additional modules. In 1989 Terminal 2D opened where Air France handles flights to and from Germany, 2C followed as late as 1993. The modular design is convenient for local passengers, who arrive at the airport from Paris or want to get to town from the airport. They only have to cover short distances between car or bus and the aircraft. However, the fact that the areas A and C as well as the areas B and D are too far apart from each other and that there are too few aircraft positions at the building make the concept unfit for efficient hub operations.

Still, Air France had problems of a different nature at the beginning of the 90s. The over-inflated national carrier is at times up to its neck in trouble. Experts expect it to go bankrupt. In 1993 the company makes a record loss of more than DM2bn and up to the year 1996 the carrier stays in the red. A much disputed subsidy of about DM6bn which is authorised by the EEC Commission and given by the French Government, is supposed to launch a restructuring program in 1994. Part of the new strategy is expansion with frequent shuttle flights into European regions, e.g. into eleven German airports and a greater use of the potential at Charles de Gaulle (CDG). Since the EEC's only condition is not to cut prices for direct flights, the national carrier Air France shows off with low prices for transfer connections via CDG. This is much to the dismay of privatised competitors like Lufthansa or BA. At this stage plans take shape in Paris to transform Terminal 2 into a global hub.

The first step is the opening of the TGV Station at Terminal 2 towards the end of 1994. Thus CDG becomes the world's first airport which can be used by the RER, the local municipal railway, as well as by high-speed trains. Air France Boss Jean Cyril Spinetta comments, "the TGV, which for a long time had been our competitor on domestic flights, has now become a feeder and co-operative partner". Today 850,000 of the around 1.3 billion annual users of the airport's TGV station either transfer from or into an aircraft. Each day these passengers have 40 trains at their disposal which connect directly with 50 cities, among them Brussels four times a day. In the long term, Air France estimates carrying two million passengers per year who use the combination of TGV and aircraft for their journey via Paris.

To the East of the TGV station, above which is the superstructure of the futuristic looking Sheraton Hotel, there is an expanse of newly reclaimed land. There is a complete reversal of the old concept of short distances for local traffic which dominate the four old modules. A move towards the principle of the quick transfer airport becomes apparent in the new Terminal F. This terminal opened both its wings which extend far into the apron in 1998/9. The uniquely styled building with its swept concrete roof which is interrupted by a glass area, modelled on the Concorde, is 400 meters wide inside. Already 40 per cent of all Air France passengers either depart or arrive in area F.

In 1999 the national carrier handled 28 million passengers at its home airport. 43.6 million passed through CDG in all. This means 12.9 per cent growth for the Parisian airport when compared with the previous year and means the largest increase of any airport in Europe. It is steadily approaching the number of passengers which Frankfurt handles (45.9 million). Today Air France is the dominant airline at CDG: the company has 63 per cent of the seating capacity and 55 per cent of all slots, 647 Air Frances flights take off and touch down each day. Analysts working for Salomon Smith Barney judge the situation as follows, "Air France has the best possible hub position from a strategic point of view. Paris is one of the most favourably situated airports in Europe. Apart from this Air France has only recently started to develop the transfer market and has furthermore the advantage of a large local market in Paris as well as the strong French home market" - the largest in Europe.

Since 1994 Air France has gone through a metamorphosis which enabled the company to occupy this strong position. The number of all serviced routes was reduced by a quarter. Instead the frequency of the remaining routes was increased considerably. Stopovers on long haul flights were more or less abandoned. Nowadays 83 per cent are non-stop connections. Also, the daily use of aircraft was increased by 19 per cent. In 1995, the second worst year in the company's history with losses of almost DM1bn, only 376 Air France flights took off and landed at CDG. Passengers have 1,886 transfer possibilities on medium and long haul flights within two hours per week. In April 1996 Air France subscribed to the hub strategy at CDG and was able to offer 5,233 transfer possibilities per week in the summer of 1996. By summer 1999 this number grew to 11,316, which is a more than five-fold increase when compared with 1995. Frankfurt can only offer 7,545 transfer destinations within two hours. For the summer 2000 a further increase of the transfer offer at CDG by 26 per cent is planned, which will means 14,267 connections per week. In the precise rhythm of a beating heart the passengers are "pumped" to and from CDG in six daily waves. 53 per cent of all landing Air France passengers are in transfer. Many of them do not stay any longer on the ground than the minimal turn-around time of 45 minutes allows.

"The hub effect is very important for us, there is simply no alternative for it", says Air France Boss Spinetta. "We take Lufthansa and Frankfurt as our model, not London-Heathrow and BA". In contrast with Heathrow, which is not seen as a true hub by experts because of its limited capacity, Frankfurt is the only European airport, which lies only just in front of Paris-CDG with the number of daily departures and non-stop destinations. To change this, Paris will play everything on its most important strength - space and the will to expand.

In March 1999 - 25 years after it was opened - CDG received a third runway located in the south. As a result handling capacity is increased from 84 to 97 flights per hour. This is more than in Frankfurt and by far more than at London Heathrow, where hardly more than 60 flights per hour are possible. However, things will improve even further: In April 2001 a fourth runway in the very north will be taken into service. This means that CDG will reach the European maximum of 120 possible flight movements per hour. Buildings are also being designed and constructed. By 2003 Module E for long-distance flights will be constructed opposite to Module F, which will then only be used for medium distance flights. It is a small module, which is situated on the adjacent land, with adjoining footbridge which leads passengers into a narrow, long building. As many aircraft positions as possible are planned in this area. Pierre-Henri Gourgeon, Air France Deputy, explains, "our main aim is to create more contact gates at the building". Nowadays only three quarters of all jets dock at the terminal, in the final extension stage there will be 95 per cent. The construction of the fourth runway and of Module E will cost about DM1.5bn. The national company Aéroports de Paris (ADP) will develop concepts and will build, finance and then run them in conjunction with Air France. The relationship between Air France and ADP is that of client and supplier.

However, the airline has annoyed the ADP with ambitious expansion plans for the time beyond 2003, which were presented at the beginning of February. Following the model of its new Alliance partner Delta Air Lines in Atlanta, Air France plans to construct two connected satellites forming the shape of an "H" at the eastern side of Roissy between 2004 and 2007. ADP Spokesman Didier Hamon comments, "it is only a suggestion, a study undertaken by Air France. In 1997 the Government put a limit of 55 million for the annual number of passengers at CDG in order to protect residents. Any new constructions can only provide additional comfort. We must not go over the prescribed limit". Air France is planning an increase of ten million passengers in the next ten years. This only leaves 9 million passengers for foreign carriers, which are still - with the exception of Air France partners - in the old Terminal 1. This is unless the limit is increased. The ADP Spokesman says, "the main thing for us it that we do not clash with the environment. Opening the new satellite part in 2004 is therefore unrealistic. It would be possible from a technical and architectonic point". He is quick to add, "we are not opposed to the project, it just had to be compatible with local conditions".

From page 36 of FLUG REVUE 4/2000