Spinetta confirms Air France talks with Etihad

And yesterday, Air France chairman and CEO, Jean-Cyril Spinetta  told news agency Reuters that the airline group is in talks to tie up with Etihad Airways.

While confirming that there are no discussions over a financial stake in the French-Dutch venture he said "We are looking at how we can co-operate with Etihad."

The French government still holds a 15% stake in the loss-making carrier.

Industry analyst Saj Ahmad said: “Just as Qantas has finally woken up to the reality that Arabian airlines are not going to go away with their inherent superiority, loss making Air France-KLM's overtures to Etihad come as little surprise. As the old adage goes, "if you can't beat them, join them."

 “And that's exactly what some of these older, less efficient legacy airlines are now doing. While the likes of Qantas and Air France will be acutely aware that they will not be able to run the show, neither do they want to embrace a partnership that stymies their own plans to turn losses into profits - it's a quagmire for them but doing nothing is not an option either.

 “Given Etihad’s full plate of stakes to date with Aer Lingus, Air Berlin, Air Seychelles and Virgin Australia, you'd have to be reckless to assume that they won't proffer a scenario to Air France where they buy a stake in them too. After all, Etihad has made no secret of its desire to increase its European presence howsoever possible.

 “Any deal, or even the spectre of deals between Etihad and Air France-KLM will likely spur both British Airways and Lufthansa to making moves too. While none of the big three Arab carriers are in an alliance, you could even argue that Qatar Airways becomes their focus point. Qatar Airways has been judicious about its acquisitions to date and there's no guarantee they'll even play ball with anyone. What is certain though, is that the dominance and influence of GCC is spreading beyond the region and it's a wakeup call to those who mistakenly believe that these Arab airlines are bubbles waiting to burst - nothing could be further from the truth."