You’ve likely heard that Air France has decided to mercifully put an end to its ridiculous Joon experiment. I hated pretty much everything about Joon from the moment it was announced, so this is yet another very encouraging sign that current group CEO Ben Smith is putting the airline on the right track for the first time in ages. But for those who followed Ben from his previous role at Air Canada, this might seem like a strange move. After all, he was behind Rouge, a similar idea, right? The ideas may have been similar but the execution was not. It’s entirely consistent for Ben to back one and not the other.
I thought about doing a parody obituary for Joon as I did for Ted a decade ago — that remains one of my favorite posts I’ve ever written — but it’s just too easy. Instead, I’ll just leave you with this final ad to complement the series I did when the airline launched.
Instead of just ripping into Joon, I thought it would be more interesting to compare Joon to Rouge. Despite looking similar on the surface, they are actually quite different in the one area that matters… labor.
Air Canada was concerned about all the low-cost, leisure-focused capacity in Canada from airlines like Air Transat and Sunwing. It said it needed to get a lower cost base in order to be able to compete in leisure-oriented markets, so it went down a predictable path. It promised growth for labor if it was willing to work for less. Back in 2015, I interviewed Ben, then the President of Passenger Airlines for Air Canada, and asked about the need for Rouge. Air Canada was already adding density on its existing fleet, so why couldn’t it just do that and lower the cost base? Here’s what Ben said.
I think because in Canada we’ve got so much capacity and competition from Air Transat and Sunwing, just doing density was not going to be enough. We needed a b-scale from flight attendants and pilots, and we needed more flexibility. That was only doable with a separate [operating certificate]. On top of that, if we were going to have a product that was comparable to the others, we needed different branding as well.
I have trouble believing the last sentence. The onboard experience isn’t different enough where branding is going to really matter. To me, the only rationale for Rouge was the ability to get lower labor costs. And Air Canada did just that. It offered to cap the fleet at Rouge in exchange for lower wages. Air Canada will tell you that it has been a wild success, but that’s not because the crew was wearing, as Rob Lowe called them, “jaunty hats” and just generally acting like cool kids. It’s because Air Canada could get its costs down.
If that’s the case, then why not just do as Iberia did and launch Iberia Express? That had absolutely nothing different than Iberia except for the “Express” tag and a lower pay scale. But Air Canada couldn’t get labor to go along with that. It had to create something significantly more differentiated, so Rouge was born. This, it should be noted, was the opposite of Ted where labor rates were the same as mainline and only the product was different. That was a truly, truly stupid idea.
I still don’t love Rouge, but if you view it purely as the bare minimum needed to be done to get labor to agree to lower costs, then it’s a fair argument to be made. Both Rouge and mainline have expanded, and they help each other grow since they’re connected in the same network, so it’s more palatable to everyone. You can understand why Ben liked this.
That brings us to Joon. Joon was originally planned as a way to get lower costs. The flight attendants did indeed agree to some concessions, but the pilots rejected them. So Joon was able to achieve far less in cost savings than it needed. Air France’s bigger problem is that it has a labor cost issue across the board. This small carve-out was never going to solve Air France’s issues.
It was set up in a similar way as Rouge. Its flights were sold as Air France flights operated by Joon, and they connected into the rest of the network. Joon had silly millennial-focused branding (which millennials hated), but the branding seemed to lead the airline’s strategy, not follow it as a necessary concession as with Air Canada. The biggest difference was in the cost structure, and that’s where Joon failed.
But there was one other macro issue that impacted Joon, and that’s the state of the relationship with labor. Air France managers have repeatedly tried and failed to get meaningful labor concessions. Things got so tense that one exec even had his shirt ripped off by protesters.
Ben Smith enjoyed relatively easy labor relations (with an emphasis on “relatively”) in Canada for the last few years with a long-term contract in place with the pilots since 2014. Once he got to Air France, he knew that improving relations would be key. Sure enough, it didn’t take him long before he was able to achieve an agreement with three quarters of the workforce. He has to keep working to establish trust, and what’s an easy way to do that? Kill the airline that didn’t provide meaningful cost savings but was reviled by all. Easy decision. And sure enough, Joon’s death was announced along with the signing of an agreement between Air France and its three flight attendant unions.
While Joon and Rouge look similar on the surface, they were anything but. When it comes down to labor, Joon was better off dead. After years of bad decision after bad decision, it is incredibly refreshing to see some smart moves being made. Kudos to Ben for making headway at an airline where true leadership has been sorely needed.