It's an open secret. Since the arrival of TGV In France, domestic routes - particularly the radial routes linking Paris to the regions - have been seriously undermined. The erosion dates back to the introduction of the first TGV, but the development of the network since the 1990s has contributed to a decline in the number of air passengers in mainland France. There were 27 million passengers in 2000 including 21.2 million on Paris-Province routes.
Eighteen years later, there were virtually the same number of domestic passengers - 26.2 million - but the Paris-Province traffic accounted for just 16.3 million passengers, down by almost a quarter in just under twenty years. In 2000, domestic traffic generated almost 28% of all passenger movements. In 2018, this share had fallen to just 15%.
Almost all routes recorded a fall in passenger numbers, with the notable exceptions of Paris-Toulouse, Paris-Biarritz and Paris-Brest. The most spectacular declines were recorded on Paris-Mulhouse/Bale, down by almost 70%. The radial routes to and from the South of France were among the worst affected: Paris-Toulon is down by almost 50%, Paris-Marseille is down by 45.6% and Paris-Montpellier by 32.5% over the period 2000 to 2018. Other routes have even disappeared altogether, the most emblematic being Paris-Strasbourgwhich in 2000 still generated almost 1.4 million passengers and was then the sixth busiest route within France. Other routes that have disappeared include Paris-Nîmes, with 225,000 passengers in 2000, and Paris-Grenoble, with 181,000 passengers.
Air France has made several attempts to stem the fall in traffic. On the radial routes, the company has entrusted the services of La Navette - scheduled airlines - to its subsidiary HOP. In 2018, there were just over 75 daily flights linking Paris Orly to BordeauxMarseille, Montpellier, Nice and Toulouse. These five routes all recorded a fall in passenger numbers - with the exception of Nice, where competition is fierce with Easyjet. On Paris-Bordeaux and Paris-Montpellier, two routes where HOP has a monopoly, the decline in 2018 was 17.3% and 1.2% respectively.
As a result, the outlook for the radial routes remains bleak. As one Air France press releaseAir France's domestic network is " heavily impacted by competition from high-speed train lines, which have increased their capacity throughout the country, reduced journey times and developed a highly competitive low-cost offer ". The carrier's press release added that " the opening of four new high-speed lines in 2016 and 2017 should attract an additional 4.7 million passengers in 2020, and where high-speed lines have become established linking Paris to the provinces in less than two hours, Air France routes have lost 90% of market share ".
Growth on domestic routes is now being driven by the transverse linesIn other words, from region to region, where there is little or no competition from the TGV. Last year, according to figures from the DGACPassenger traffic on these routes rose by 10% to 9.9 million passengers. The most buoyant routes include Bordeaux-Nice, up last year by 29%, and also Nantes-Toulouse up 16.7%. Two routes already generate more than half a million passengers a year: Bordeaux-Lyon with 561,000 passengers in 2018 (+5.8%) and Lyon-Nantes with 520,000 passengers (+7.7%). Lyon is benefiting from its status as an Air France/HOP regional hub. Six of the twenty busiest transborder routes connect to the city on the Rhône.
But this upturn on cross-border routes only seems to be partially benefiting the Air France group, which is present in the provinces through its subsidiary HOP. Admittedly, the carrier offers the largest range of air services in the regions. In 2018, it operated 600 daily flights on domestic and regional European routes, including 30 routes from Lyon and 26 from Paris-.Orly. This can be seen in the decline of the French flag on domestic routes. In 2000, this flag - in fact, Air France - had a share of 98% on the domestic market. Last year it fell below 80% for the first time, to 79.1%. That's down five points on 2015.
The reduction in the company's presence in the regions is a logical consequence of the company's announcement of a 189 million euro loss on domestic business in 201896 million in 2017. Its only weapon to combat Easyjet or Ryanair on domestic routes could be the possible ramp-up of Transavia on certain routes. Paris-Nice, Paris-Toulouse or even Nantes-Nice could form the basis of a domestic low-cost network for the group, which could at least consolidate its market share on domestic routes. But is this really the strategy envisaged by Benjamin Smith?
