European air giant gets busy

AIR France-KLM Group, Europe's biggest airline, said passenger traffic rose 6.9 percent in August on increased travel to the Americas and Asia.

The load factor, or proportion of seats filled, increased one percentage point from a year earlier to 85.3 percent, while the airline offered 5.7 percent greater seating capacity, Paris-based Air France-KLM said in a statement yesterday. The number of passengers rose 5.6 percent to 6.7 million.

Chief Executive Officer Jean-Cyril Spinetta, who led Air France's purchase of KLM in 2004, has used higher fares and fuel surcharges to boost earnings. Bases in Paris and Amsterdam have helped the airline attract travelers for connecting flights from Europe to Asia and the Americas.

Spinetta said on May 21 that operating income for the full year ending March 2008 will rise, achieving a target of a seven percent return on capital two years ahead of schedule. Air France-KLM initiated a program to reduce expenses by 1.4 billion euros (US$1.9 billion) over three years and set a target of an 8.5 percent profit margin by fiscal 2010.