Air France suffers €50-million loss after terror attacks on Paris

Recent terror attacks on Paris have been impacting air traffic in the global center for art, fashion, food and culture.

With many trips being canceled, Air France is suffering from revenue loss. The air traffic to and from Paris has dropped significantly.

Air France-KLM is optimistic that by the end of December, the negative effect will be worn off. Other airlines are also suffering from the drop in air traffic. Bank of France has lowered its forecast for economy growth for the fourth quarter.

The attacks on Paris killed 130 people and are impacting the aviation sector. It's estimated that the total revenues loss in November at €50 million.

The air traffic was building up in Paris aviation sector before the terrorist attacks. In a report by BBC, Air France-KLM said, "The negative impact of the Paris attacks on total November revenues is estimated to be around €50 million ($54million /£36millionn). Current booking trends are in line with a progressive recovery including a very limited impact on volumes after the end of December 2015."

Air France's load factor eased by 0.9 percentage points after the attacks on Paris. The load factor gauges the occupancy of flight. The French-Dutch group is expecting the events will weigh on passenger volumes going in next year. The impact of terrorist attacks on Paris should be very limited. 

France is just returning to economic recovery after a prolonged stagnation. The terrorist attacks are also impacting France's economy. The attacks came at a time when France is witnessing fragile economic recovery, as reported by CNN Money.

The Bank of France lowered its growth forecast for fourth quarter to 0.3 percent from 0.4 percent.  

Air France-KLM's CFO Pierre-Francois Riolacci believes that the impact of November attacks wouldn't be enough to weaken the company in reaching the target for 2015 year.

Riolacci says the airline is already back on recovery. Considering the previous impacts of terrorist attacks on Madrid in 2004 and London in 2005, Riolacci said it would take 3-6 months to recover the lost bookings. 

"The current booking trends are in line with a progressive recovery including a very limited impact on volumes after the end of December 2015," Air France-KLM said in a statement as published by RT.

Other airlines are also feeling the heat of drop in air traffic. Europe's largest low-cost airline Ryanair has slashed fares to attract more passengers. Ryanair said it didn't expect the lower fares to have a material impact on its financial performance.  

Scandinavian carrier SAS sees a drop in air travel volumes to Paris and Brussels. However, the airline is hoping that traffic is returning to normal level. Hotels, restaurants, and other leisure segments' businesses were hit by terrorist attacks.