French flag carrier Air France has decided to pull the plug on its low-cost airline targeted at millennial travelers on Thursday. The airline was set up to compete with the rise in budget carrier travel which many legacy carriers have begun to do. However, the idea just didn’t seem to appeal to  consumers who were not interested in an airline made for young travelers.

So Why Did Joon Fail?

Well, there are quite a few answers to this but let’s point out the obvious. Joon just was not profitable, not only did it fail to break even, it only dragged down its parent company Air France-KLM. The airline began service in December of 2017 to a few different European destinations from the Air France hub at Paris’ Charles De Gaulle international airport. According to airfleets.net, Joon operated 18 aircraft when Air France announced its closure. These aircraft all came second hand from Air France. The fleet consisted of Airbus A320’s, 321’s and even the larger A340.

JOON Arrives at Budapest Airport

So back to where it went wrong. Well, it’s safe to say that just about everything went wrong here. First of all, Air France was looking for a market that didn’t really exist. Millennial travelers often prefer cheap, no frill flying that won’t cost them a fortune. Joon on the other hand ended up doing the opposite, in fact, Air France went as far as to switch some of its long haul operations like the popular St. Martin to Paris route from Air France to Joon. Air France was then selling what was apparently a Joon product but was actually an ex-Air France A340-300 with a Joon livery and interior design. The tickets were then sold at prices even higher than what Air France mainline service was priced at. This not only was a waste of money for the already struggling Air France-KLM Group but completely eliminated the entire idea of low-cost travel aimed towards young travelers. Long haul service was not the only Air France mainline service to receive the Joon replacement, Air France’s busy Paris-Berlin route which was one of the first to be replaced by Joon was the same story as St. Martin. Air France A320’s and A321’s were converted to Joon paint and interior with the hard product remaining the same.

Air France then used Joon as a way to work around the strong unions in France. Air France pilots and crew were transferred to Joon and then paid less. Joon did however profit a little bit off of airport subsidies.

In order to try and profit, Joon needed to raise prices. So that’s what they did, the problem was that travelers were not interested in paying higher prices for short haul, inter-Europe flying. There just wasn’t anything to set Joon apart. Recently Air France-KLM hired new CEO Ben Smith who spent a long time with Air Canada as President Airlines and Chief Operating Officer. Smith’s decades of experience are vital in the future of the Air France-KLM Group. Since joining the company in September 2018, Smith has begun numerous changes in the company one of which has been announcing the dismissal of Joon.

In conclusion, the airline just wasn’t going to be profitable. The cost of marketing and rebranding aircraft, was too expensive. The product being sold was the same old product just more expensive and the market didn’t exist. Competition was very tough for the routes being operated and Joon was not able to compete. Shutting down Joon will allow Air France to pay pilots and crew more and also begin to profit again. Under new leadership, Air France -KLM hopes to move forward and remain one of Europe’s leading airline groups.

Featured Image by Budapest Airport.

Categories: Industry Talk