Roissy, 23 March 2005 Press release no. 4868 FLYING BLUE, THE NEW JOINT FREQUENT FLYER PROGRAM FOR THE 66,3 MILLION CUSTOMERS OF THE AIR FRANCE KLM GROUP (logos can be downloaded from www.airfrance.com/cpate) In June 2005, f the first time, the frequent flyer programs of two maj European airlines will merge into one. Consequently, Air France s «Fréquence Plus» and KLM s «Flying Dutchman» programs will join fces to give birth to Flying Blue. With ten million members, Flying Blue is the basic tool f both airlines Customer Relations Management programmes to recognize their loyal customers, and to provide them with consistently high quality service, regardless the airline they travel on. Flying Blue will be a strong symbol of the successful combination of Air France and KLM. This joint program is an integral part of the Group s Customer Relations Management global strategy. Based on the principle of «one group, two airlines», this strategy puts the Group s 66,3 million customers first. The program is both innovative and easy to use. It contains four membership levels Ivy, Silver, Gold and Platinum. «Flying Blue» will enable its members to benefit from many advantages of the combined netwks of Air France and KLM. 1
The main purpose of «Flying Blue», built on the best of the fmer Air France and KLM frequent flyer programs, is to satisfy its members needs. Fréquence Plus and Flying Dutchman cardholders will, of course, automatically become members of the new program, and will retain all the Miles they have accrued up to now, without any drop in value (1 Fréquence Plus Mile = 1 Flying Blue Mile; 1 Flying Dutchman Mile = 1 Flying Blue Mile). Together with mote than 30 partner airlines, «Flying Blue» will enable customers to earn Miles and use them very advantageously on the 18,000 daily flights to 900 destinations. Furtherme, some 100 non-airline partners have joined the program, thereby increasing the opptunities to earn and burn Miles. Members of the «Fréquence Plus» and «Flying Dutchman» programs have begun to receive practical infmation concerning «Flying Blue» and these documents will continue to be sent to customers until the end of May. The merger between Air France and KLM has already led to unprecedented combined offers by both airlines. The alignment of netwks, the combinable fares and the harmonization of operations at the two hubs at Paris-Charles de Gaulle and Amsterdam Airpt Schiphol, are just some of the measures aimed at facilitating access to the global netwk f all customers. Jean-Cyril Spinetta, Chairman and CEO of Air France declared: «Flying Blue» is an excellent example of the ability of both airlines to innovate, thanks to the Air France-KLM merger. It is a great asset f our customers». With «Flying Blue», Air France and KLM are flying higher than their competits, and this is just the beginning», declared Leo van Wijk, President and CEO of KLM. * This documentation (including the Flying Blue card) is sent to members who have earned Miles with Fréquence Plus Flying Dutchman in the last 24 months; the others will receive their documentation when they next use their FFP cards. The merger agreement signed in September 2003 by Air France and KLM gave birth to Europe s leading airline group in May 2004. The Group consists of a holding company and two airlines which retain their brands, identities and three ce businesses. The new Group now represents 106,000 employees, 66.3 million passengers, 225 destinations and a fleet of 556 aircraft, thus ranking first wldwide by turnover and number one in Europe.
FLYING BLUE NEW JOINT FREQUENT FLYER PROGRAM CONTENTS I. AUTOMATIC MEMBERSHIP FOR FREQUENCE PLUS AND FLYING DUTCHMAN MEMBERS.P 5 II. A PROGRAM OPEN TO ALL... P 6 III. NEW TYPES OF MILES : AWARD MILES AND LEVEL MILES... P 7 IV. MILES DEPENDING ON THE CLASS OF TRAVEL... P 10 V. MILES DEPENDING ON THE LEVEL OF MEMBERSHIP... P 11 VI. AWARD TICKETS OBTAINED WITH AWARD MILES... P 12 VII. VIII. THE BENEFITS OF THE FOUR FLYING BLUE LEVELS... P 15 MANAGING ACCOUNTS AND ORGANIZING TRIPS ON WW.AIRFRANCE.COM AND WWW.KLM.COM... P 22 IX. FLYING BLUE COMMUNICATION... P 23 Appendices: - The name Flying Blue, - The benefits of the Flying Blue levels, - SkyTeam, Elite and Elite Pus, - AF/KL Group. 3
Roissy, Amstelveen, 20 April 2005 FLYING BLUE, THE NEW JOINT FREQUENT FLYER PROGRAM On 6 June 2005, Air France and KLM will offer their 66.3 million passengers their new joint frequent flyer program, Flying Blue. With 10 million members, the purpose of Flying Blue is to become the leading frequent flyer program in Europe and satisfy its members needs. Flying Blue will enable its members to earn and spend Miles on the combined netwks of Air France and KLM and also on flights operated by SkyTeam member airlines and some other 30 airline partners. This global netwk of 18,000 flights and 900 destinations will enable customers to benefit from all the advantages that Europe s leading loyalty program has to offer. Furtherme, some 100 non-airline partners will have joined the Flying Blue program, thereby increasing the opptunities to earn and burn Miles. Structured in four levels (Ivy, Silver, Gold, Platinum), Flying Blue makes it possible to track the flight behaviour of each of its customers and rewards them with Miles accdingly. Frequent travellers on any of the nine SkyTeam member airlines and Kenya Airways accrue Miles enabling them to move up to the next highest tier. Furtherme, Air France and KLM offer Platinum members the possibility of becoming lifetime Flying Blue Platinum members, with all the privileges that come with it. The Flying Blue program is a tool f both airlines to recognize their loyal customers, regardless of which of the two airlines they travel on. Members of the new joint frequent flyer program will be able to benefit from consistently high quality service on the combined netwks of Air France and KLM. Innovative, fward-looking and easy to use, Flying Blue offers members the freedom to manage their account how and when they want on the www.airfrance.com www.klm.com websites and to benefit from exclusive advantages reserved f surfers. 4
I. AUTOMATIC MEMBERSHIP FOR FRÉQUENCE PLUS AND FLYING DUTCHMAN MEMBERS. All members of Fréquence Plus and/ Flying Dutchman automatically become members of the new Flying Blue program, with no need f any fmalities. Welcome kits containing the new cards, along with a user's guide full of practical infmation, will be sent to all members of Fréquence Plus Flying Dutchman that activity recded in their account in the preceding 24 months. All Miles earned with Fréquence Plus and/ Flying Dutchman are automatically transferred to the Flying Blue account, and can be redeemed with Air France, KLM and all partners of the new joint program. Miles are transferred at their full value: 1 Fréquence Plus Mile = 1 Flying Dutchman Mile = 1 Flying Blue Mile The account number remains the same f Fréquence Plus members and is slightly modified f members of Flying Dutchman. The accounts of those who are members of both programs will be merged, on customer s request. 5
II. A PROGRAM OPEN TO ALL The Flying Blue program is of course open to all, regardless of their country of residence (it is possible to join from the age of 2!). While membership is automatic f present members of Fréquence Plus and/ Flying Dutchman, other passengers can, as from mid May 2005, join directly on line at: - www.airfrance.com, - www.klm.com. Membership fms are also available from Air France and KLM ticket offices and sales desks, in airpts and on board Air France and KLM flights (in the in-flight magazines). Once the fm is filled in, it must simply be signed and returned to Flying Blue. Flying Blue 94852 Ivry-Sur-Seine cedex France 6
III. NEW TYPES OF MILES: AWARD MILES AND LEVEL MILES All members earn Award Miles. Among the Award Miles accrued by members, some are Level Miles. These determine one s membership tier in the program and enable members to move up to the next highest tier, once the required number of Level Miles has been reached. Fréquence Plus Mile = Flying Blue Award Mile Fréquence Plus Qualifying Mile = Flying Blue Level Mile Flying Dutchman Award Mile = Flying Blue Award Mile Flying Dutchman Level Mile = Flying Blue Level Mile Award Miles accrual with 130 airline and non-airline partners: Members can earn Award Miles: - On all flights with AF KL flight numbers, - On all flights with SkyTeam flight numbers operated by a SkyTeam airline, - On all flights operated by a Flying Blue partner airline, - With non-airline partners. The number of Miles that can be earned is calculated in accdance with the distance flown on long-haul routes. EXAMPLE: Minimum number of Miles accrued between Paris / Amsterdam and: - New Yk: 3,640 / 3,639 - Sao Paulo: 5,839 / 6,078 - Tokyo: 6,029 / 6,007 F sht- and medium-haul flights*, members receive a set number equal to: 7
500 Miles* on sht-haul flights (domestic flights) 750 Miles* on medium-haul flights (international flights). Above 750 Miles, the distance flown principle applies. *excluding non-eligible flights. It is also possible to obtain Miles with the Service Class Bonus (see part IV.) and the Elite Bonus (see part V.). Members can also earn Award Miles when they book services with one of the nonairline partners of Flying Blue, i.e., car rental, hotel accommodation, etc. EXAMPLES: F e.g., Gold members earn between 150 and 500 Award Miles per stay in an Acc hotel between 100 and 500 Award Miles per stay in a Hilton hotel. Award Miles remain valid f 36 months, but their validity can be extended if the member makes at least one trip every three years with a SkyTeam member airline. F members residing in metropolitan France, the Award Miles earned with purchases made with the Air France/KLM American Express Gold also enable the validity of their Award Miles to be extended. Accrual of Level Miles: Members can earn Level Miles on all flights operated by SkyTeam members and those of Kenya Airways. EXAMPLE: An Ivy member accrues 3,639 Award Miles, travelling in Economy class on an Amsterdam New Yk flight operated by SkyTeam member Continental Airlines. All these Award Miles are qualifying miles which the member can use to qualify f the next level. 8
In addition, members residing in metropolitan France the French Overseas Departments can earn Level Miles by paying f purchases with the Air France/KLM American Express Gold card. Level Miles consist of the miles based on distance flown ( minimum mileage) and the Service class Bonus. Level Miles can be accumulated from 1 January to 31 December of the year in which they are earned. The total of Level Miles in the member's account at the end of this period determines his her status f the following year. Of course it is possible, at any time during the year, to move up to the next highest tier, as soon as the required number of Level Miles has been reached. 9
IV. MILES DEPENDING ON THE CLASS OF TRAVEL Flying Blue program members can benefit from a Service Class Bonus accding to their booking class. First Class.. Business Class, medium-haul. Tempo Challenge, Air France. Europe Select, KLM. Alizé, Air France... Business Class, Long-haul.. + 200 % + 100 % + 100 % + 100 % + 50 % + 50 % EXAMPLE: On an Air France Paris New Yk flight, a Flying Blue Ivy member travelling in l Espace Première obtains: 3,640 Miles (f the distance flown) + 7,280 (200%, Service class Bonus) = 10,920 Miles in total On a KLM Amsterdam Rome flight, a Flying Blue Ivy member travelling in Europe Select obtains: 809 Miles (f the distance flown) + 809 (100%, Service Class Bonus) =1,618 Miles in total 10
V. MILES DEPENDING ON THE LEVEL OF MEMBERSHIP Flying Blue program members can benefit from an additional Elite Bonus accding to their Level : F each flight made : - Flying Blue Silver : 50% additional Miles will be credited to the member's account, - Flying Blue Gold : 75% additional Miles will be credited to the member's account, - Flying Blue Platinum : 100% additional Miles will be credited to the member's account. 11
VI. AWARD TICKETS OBTAINED WITH AWARD MILES Award tickets are those that can be acquired in exchange f a certain number of Award Miles. EXAMPLE: A Tempo Economy ticket f a Paris Amsterdam New Yk flight can be exchanged f 50,000 Award Miles, A Tempo ticket between Paris and Rio de Janeiro can be exchanged f 80,000 Award Miles A Tempo Economy ticket between Paris Amsterdam and Tokyo can be exchanged f 80,000 Award Miles. A one-way Award Ticket can be acquired in exchange f a number of Award Miles. F example, new members making a round trip between France and the French Caribbean in Tempo may book a one-way ticket f Paris-Nice by redeeming the Miles earned from this trip and their Welcome Miles. Example: - New members making a round trip between Paris and Ft de France in Tempo may earn: 4,268 x 2 = 8,536 Miles - All new members receive a welcome bonus of 3,000 Miles, representing a total of: 8,536 + 3,000 = 11,536 Miles - Members can exchange these 11,536 Miles f a one-way ticket f Paris-Nice, wth 10,000 Miles. 12
It is very easy to book an Award ticket: F flights with a SkyTeam member airline*, passengers can go to the www.airfrance.com www.klm.com websites and book on line, up to the day of departure. It is also possible to book an award ticket f a specific destination by calling a Customer Service Center, up to the day of departure. F airline partners who are not members of the SkyTeam Alliance, reservations must be made two weeks in advance. * Service available f the following SkyTeam member airlines: Air France, KLM, Continental, Delta Air Lines, Nthwest, Alitalia and CSA. Members can exchange their Award Miles f a class upgrade on a flight f nonairline partners services. The Flying Blue program extra : book award tickets on an Air France, KLM, Nthwest Kenya Airways flight with the Open Miles option: If no seats are available f award tickets on a given flight, the member can book one with the Open Miles option, which doubles the number of Miles otherwise required. This option also permits members to modify a ticket free of charge, even after issuance. On eligible flights, award tickets are nmally issued as e-tickets. The member s Flying Blue card simply needs to be presented at check-in at a self-service kiosk. 13
Examples of ways of obtaining Award tickets (round trip flights) with Award Miles in Economy/Tempo class: Award Ticket PARIS-RIO AMSTERDAM - ROME PARIS NICE Number of Miles required Number of round trips required 80,000 Miles 25,000 Miles 20,000 Miles F a PLATINUM member - 1.8 round trips in First Class, - 2.8 round trips in Business class, - 3.5 in Economy/Tempo. - 5,2 round trips in Business Class, - 7,7 round trips in Economy/Tempo. - 6.7 round trips full fare travel saver fare, - 0.9 round trips between Paris and Rio in Economy/Tempo. F a GOLD member - 1.9 round trips in First Class, - 3.1 round trips in Business class, - 4 round trips in Economy/Tempo. - 5,6 round trips in Business Class, - 8,8 round trips in Economy/Tempo. - 7.3 round trips full fare travel saver fare, - 1 round trip between Paris and Rio in Economy/Tempo. F a SILVER member - 2 round trips in First Class, - 3.5 round trips in Business class, - 4.7 round trips in Economy/Tempo. - 6,2 round trips in Business Class, - 10,5 round trips in Economy/Tempo. - 8 round trips full fare travel saver fare, - 1.2 round trips between Paris and Rio Economy/Tempo. F a IVORY member - 2.3 round trips in First Class, - 4.7 round trips in Business class, - 7 round trips in Economy/Tempo. - 7,7 round trips in Business Class, - 15,5 round trips in Economy/Tempo. - 10 round trips full fare travel saver fare, - 1.8 round trips between Paris and Rio Economy/Tempo. 14
VII. THE BENEFITS OF THE FOUR FLYING BLUE LEVELS Flying Blue Ivy: The Flying Blue Ivy card enables members to earn and spend Miles throughout the wld with all program partners. Every trip is a new opptunity to earn spend Miles. Thanks to Level Miles accrual, members can move up to the next-highest level. On making their first trip with Air France, KLM, a SkyTeam member airline one of the Flying Blue program partner airlines, new members receive a Welcome Bonus of 3,000 Miles, one of the most generous in the market. Flying Blue members earn Level Miles on every flight they make with one of the nine SkyTeam member airlines and Kenya Airways, enabling them to move up to the next highest tier. EXAMPLE: On an KLM Amsterdam New Yk one-way flight, a new Flying Blue Silver member travelling in Tempo obtains: 3,639 Miles (f the distance flown) + 3,000 (Welcome Bonus) = 6,639 Miles in total. 15
Flying Blue Silver 1) How to reach Silver level? Members residing outside metropolitan France move up to Silver once: - they have reached the threshold of 25,000 Level Miles accrued between 1 January and 31 December of the current calendar year, - they have made 15 international one-way flights with SkyTeam member airlines. F members residing inside France, the threshold is set at 30,000 Level Miles 15 international one-way flights with SkyTeam member airlines. 2) The benefits of Silver level: F each flight made, 50% additional Miles will be credited to the member's account. EXAMPLE: On an Air France Paris New Yk one-way flight, a new Flying Blue Silver member travelling in l Espace Première obtains: 3,640 Miles (f the distance flown) + 7,280 (+200%, Service Class Bonus) + 1,820 (+50%, Elite Bonus) = 12,740 Miles in total. On a KLM Amsterdam Rome flight, a Flying Blue Silver member in Select Europe obtains: 809 Miles (f the distance flown) + 809 (+100%, Service Class Bonus) + 405 (+50%, Elite Bonus) = 2,023 Miles in total. 16
The benefits to which Silver members are entitled make f smoother, easier travelling, on the ground and in the air: - Dedicated reservations service, 24/7 - The possibility of having a guaranteed seat f bookings made at least 7 days befe departure - Priity on waitlists - Priity at transfer desks at Paris-CDG and Amsterdam-Schiphol, regardless of the class of travel - 5 kg excess baggage allowance - Priity check-in and boarding - Seat selection When dealing with specific non-airline partners, Flying Blue Silver members enjoy better rates and special benefits such as the possibility, in some hotels, of a late check-out. 17
Flying Blue Gold 1) How to reach Gold level? Members residing outside metropolitan France move up to Gold once: - they have reached the threshold of 40,000 Level Miles accrued between 1 January and 31 December of the current calendar year, - they have made 30 international one-way flights with SkyTeam member airlines. F members residing inside France, the threshold is set at 60,000 Level Miles 30 international one-way flights with the SkyTeam member airlines. 2) The benefits of Gold status: F each flight made, 75% additional Miles will be credited to the member's account. EXAMPLE: On an Air France Paris New Yk one-way flight, a Flying Blue Gold member travelling in l Espace Première obtains: 3,640 Miles (f the distance flown) + 7,280 (+200%, Service Class Bonus) + 2,730 (+75%, Elite Bonus = 13,650 Miles in total 18
In addition to the Silver benefits, Gold privileges enable members to travel in optimum comft. Among the many benefits linked to Gold status: - Dedicated reservations service, 24/7 - The possibility of having a guaranteed seat on Air France and KLM flights if the reservation is made at least 24 hours befe departure - Priity on waitlists - Access to all SkyTeam lounges* wldwide, - Priity at the transfer desks at Paris-CDG and Amsterdam-Schiphol Airpts - 10 kg excess baggage allowance - Priity check-in and boarding - Seat selection - Priity baggage delivery on arrival of all international flights, - Baggage protection at Paris-CDG (f long haul flights), - Free transfers between Paris-Charles de Gaulle and Paris-Orly on Air France coaches. * F Flying Blue Gold members residing in United States and Mexico, access to AF/KL lounges only. And of course, all benefits to which Flying Blue Silver members are entitled with our nonairline partners apply to members of Flying Blue Gold. 19
Flying Blue Platinum 1) How to reach Platinum status? Members residing outside metropolitan France move up to Platinum once: - they have reached the threshold of 70,000 Level Miles accrued between 1 January and 31 December of the current calendar year, - they have made 60 international one-way flights with SkyTeam member airlines. Option of carrying over Miles from one year to the next Flying Blue Platinum members with over 115,000 Level Miles (150,000 f residents in France) have their Miles automatically carried over from one year to the next. F members residing inside France, the threshold is set at 90,000 Level Miles 60 international one-way flights with SkyTeam member airlines. 2) Benefits of the Platinum card: F each flight made, 100% additional Miles will be credited to the Flying Blue Platinum member's account. EXEMPLE: On an KLM Amsterdam Hong Kong one-way flight, a Flying Blue Gold member travelling in Wld Business Class obtains: 5,763 Miles (f the distance flown) + 5,763 (+100%, Service Class Bonus) + 5,763 (+100% Elite Bonus) = 17,289 Miles in total. 20
Benefits of the Platinum card: - Dedicated reservations service, 24/7 - The possibility of having a guaranteed seat on Air France and KLM flights if the reservation is made at least 24 hours befe departure - Priity on waitlists - Access to all SkyTeam lounges wldwide - Priity at the transfer desks at Paris-CDG and Amsterdam-Schiphol Airpts - 20 kg excess baggage allowance - Priity check-in and boarding - Seat selection - Priity baggage delivery on arrival of all international flights - Baggage protection at Paris-CDG (f long haul flights) - Free transfers between Paris-Charles de Gaulle and Paris-Orly on Air France coaches. Furtherme, under certain conditions, cardholders become lifetime Platinum members: Platinum f Life After ten consecutive years as a Platinum member, cardholders become lifetime Platinum members. Their years at the status of Fréquence Plus Red Flying Dutchman Platinum Elite will be accounted f. They will enjoy the full range of benefits to which they are entitled. 21
VIII. MANAGING ACCOUNTS AND ORGANIZING TRIPS ON WWW.AIRFRANCE.COM OR WWW.KLM.COM Flying Blue members can log on to the www.airfrance.com and www.klm.com websites 24/7 using the same pin code and manage their account and ganize their trips. Members who manage their account exclusively on www.airfrance.com and www.klm.com websites receive a 1,000 Miles bonus. They can also obtain e-awards exclusively bookable on line. Members can access the internet 24/7 to: - Consult their account, - Consult their most recent transactions, - Consult promotions reserved f members, - Consult the newsletter, - Consult a list of all potential Q&A, - Update their personal data, - Change their pin code, - Request an update of non-credited Miles earned on Air France KLM flights. Members can also ganise their award trip 24/7: - Order their Award ticket on one of the SkyTeam member airlines (a reservation confirmation is immediately sent by mail), - Search f flight schedules updated in real-time, - Download flight schedules, - Search f current offers, - Rent a car and book a hotel night anywhere in the wld, - Consult all opptunities f spending Miles on non-airline partners services, 22
IX. FLYING BLUE COMMUNICATION A Mileage Summary every 2 months: All members receive a Mileage summary every 2 months by e-mail mail. The Summary contains all infmation relating to their Miles balance, the most recent transactions, in addition to any infmation, offers and promotions related to the member s place of residence. Members can choose to receive their Mileage Summary in one of six languages: French, Dutch, German, English, Spanish Italian. At any time, around-the-clock, the account can be consulted online on www.airfrance.com www.klm.com. Six annual newsletters: Flying Blue* members receive a newsletter with their Mileage Summary. Four of these newsletters, issued in February, June, August and September, cover infmation related to Air France, KLM and SkyTeam member airlines, in addition to infmation about program airline partners and sales staff. The April and October issues contain infmation about the summer / winter schedules and frequent flyer program news. * Flying Blue Ivy members receive the Mileage Summary and the newsletter when they have recded activity in their account in the two preceding months. 23
APPENDICES 24
THE NAME FLYING BLUE The name Flying Blue was chosen last September as part of a process which lasted almost one year. To begin with, Air France and KLM agreed on the joint values they wished to convey:. closeness to their customers. openness to different cultures. modernity In addition, the name had to be easy to pronounce, understandable all over the wld, attributable to Air France and KLM and of course available f use, which was certainly not the least of our constraints. Tests were then conducted on French, British, German, Dutch, Spanish, Italian and Ptuguese members of the Fréquence Plus and Flying Dutchman programs in der to reinfce the values and wking tracks. Additional inquiries were made in Asia to experts with a sensitivity to local issues. A choice of 500 names were presented and then screened by the teams in charge of the project from both airlines. They were then tested throughout the wld from a linguistic and legal viewpoint. The brand had to be filed in close to 120 countries. The Air France-KLM (SMC) Group s Strategic Management Committee met on several occasions throughout the process, and finally chose Flying Blue f the following reasons: Flying Blue was unanimously appreciated in all the countries it was presented in. It embodies air transpt values and the positioning of the product, such as freedom, openness and energy. Finally, the English name illustrates the international dimension of Air France and KLM Customers will be notified of the new program in 6 languages including French f the French-speaking members. 25
ATTENTION INSERTION DE LA PAGE EN FORMAT PAYSAGE FICHE RECAPITULATIVE STATUTS FLYING BLUE TOUS LES AVANTAGES 26
AIR FRANCE-KLM FACTS AND FIGURES 1st wldwide in terms of revenue: 17.79billion euros (2003-04 data) 3rd wldwide in terms of revenue passenger-km 1st wldwide non-consolidated cargo airline in terms of revenue tonne-km 225 destinations served 106 long-haul and 119 medium-haul me than 101,000 employees 2003-04 data Air France KLM Air France-KLM Passengers (million) Aircraft in operation 43.7 19.0 62.7 357 112 469 27