Air France KLM adds flights to North Africa amid Middle East conflict

(Reuters) - Air France KLM said on Tuesday that weak demand for leisure travel to Egypt and Jordan since the Oct. 7 Hamas attack on Israel had forced the group to redeploy a big portion of that capacity to North Africa.

Chief Executive Officer Ben Smith said during a call with analysts that the airline was "cautiously optimistic" that demand for Tel Aviv and Beirut flights will recover, but those in southern Egypt and Jordan are still not close to pre-October levels.

WHY IT'S IMPORTANT

Global travel demand has weakened since the conflict broke out between Israel and Hamas in October.

Airlines have suspended hundreds of flights to and from Tel Aviv, as well as some to Lebanon and Jordan since the outset of the war and the conflict has also hurt bookings in the region.

Earlier this month, global airlines were also forced to change flight routes over Iran, cancel some flights, divert others to alternate airports or return planes to the points of departure, as Israel's reported attack on Iran led to airspace and airport closures and security concerns.

THE NUMBERS

A significant capacity increase and the geopolitical disruptions across Asia and the Middle East knocked yields - average revenues per passenger - by 6.9% in the first quarter, the group said in a statement.

KEY QUOTES

"We are cautiously optimistic that Tel Aviv and Beirut will come back to the levels that they were at prior to October. It's a bit different in the leisure markets of Southern Egypt and in Jordan, which are still not back, not close to where we were before October," Smith said.

"We redeployed a big portion of that capacity to other markets. And luckily, for (low-cost unit) Transavia, we have a lot of opportunity in the Northern African countries of Morocco, Algeria, and Tunisia. So, that's at least been able to maintain our forecast for Transavia," he added.

(Reporting by Diana Mandiá; Editing by Josephine Mason and David Evans)