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Air France opts for Delta?
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June 18, 1999: 10:11 a.m. ET
Report: French flag carrier chooses Delta over Continental in alliance race
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LONDON (CNNfn) - Air France is close to choosing Delta Air Lines as its exclusive U.S. alliance partner, according to a report published Friday.
The deal would cement the French flag carrier's existing links with Delta and end a year-long contest with Continental Airlines, which also has commercial ties with Air France.
Air France is the last of the major European carriers to sign up to one of the four global alliance groupings which are transforming the international airline industry.
The French newspaper Les Echos said the Air France board will vote on the plan next week.
Air France declined to comment on the report but said a final decision will be made within a few weeks. "We're going to choose our U.S. partner by the beginning of the summer and our global partner by [the third quarter]," an official told cnnfn.com.
Air France has returned to profitability after years as a state-owned loss-making giant. A minority stake was floated on the Paris bourse in February.
Analysts said the airline was prized because of its control over Europe's second-largest domestic airline market while the growth potential of its hub at Paris Charles de Gaulle (CDG) airport outshone alternatives at among Europe's congested airports.
Air France signed marketing and code-share agreements with both Delta (DLT) and Continental (CAL) last June, but the Atlanta-based carrier has emerged as the front-runner in recent months after restructuring its transatlantic operations.
Delta already operates a patchwork of alliances in Europe and has links with Swissair, Austrian Airlines and Belgium's Sabena. It has also been linked with a stake in Aer Lingus, scheduled for privatization later this year.
Delta told cnnfn.com that it was awaiting Air France's decision but added the current arrangement was progressing well. "We've seen a very strong performance for our Paris flights since we moved into the Air France terminal at CDG," said a Delta official.
A deal with Delta would likely lead to Air France pulling out of its link with Continental (CAI.A), which is pushing to become part of the developing Wings global alliance led by its own partner Northwest Airlines (NWAC)and KLM Royal Dutch Airlines.
Air France shares dipped 0.7 percent to 17.32 euros in Paris trading.
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