Air France's main pilots' union Sunday ended the longest strike in the carrier's history to allow "calmer" talks to go ahead over the contentious issue of the airline's low-cost subsidiary Transavia.

A spokesman for the SNPL union, Guillaume Schmid, told AFP the pilots were ending the protest - which has cost Air France more than 200 million euros ($250 million) over the past two weeks - so that the negotiations over Transavia can proceed.

Air France sees Transavia's development as vital in the struggle to retain market share in the cutthroat medium-haul sector, which is steadily being overrun by no-frills airlines such as easyJet and Ryanair.

But Air France pilots, who earn up to 250,000 euros a year, fear some of their flights will be replaced with services operated by Transavia, or their contracts will be squeezed by the expansion of the subsidiary.

Immediately after the pilots' union announced the end of the strike, French Prime Minister Manuel Valls called on all sides to "regain the confidence of everyone and resume the development of Air France and its subsidiary Transavia, which is an asset".

Valls said the 14-day strike was "misunderstood and penalised passengers, the company and the country's economy".

The protest saw half of Air France's fleet grounded, and cost the airline between 15 million and 20 million euros a day. Thousands of passengers had travel plans disrupted.

On Friday, Valls ruled out a proposal by the pilots to lift the strike if an independent mediator was named to run the thorny negotiations.

Talks over the issue have been deadlocked. The latest round, which ended early Sunday, "did not suit us," Schmid said.

But he said the decision had been taken to lift the protest to allow discussions "in a calmer climate".

The pilots are fighting for a "single contract" across Air France-KLM and its subsidiaries to avoid being forced to accept less attractive working conditions at Transavia, which serves holiday destinations across Europe and the Mediterranean.

A Transavia captain earns up to 160,000 euros a year but clocks up significantly more flights than one flying for Air France. Co-pilots on both airlines earn roughly the same amount at the beginning of their careers, according to sources.

The French state holds a 16 percent stake in Air France-KLM, the second-largest European carrier after Germany's Lufthansa.

Air France's share price plunged nearly 15 percent since the stoppage began and the protest fuelled wide concern in France.

The strike was "catastrophic for the French aviation sector," a joint statement from key industry unions, including those representing travel operators, had warned.

"In a more-than-morose economic context, it is compromising a future that is already seriously under threat," read the statement.

Air France welcomed the end of the strike but deplored the fact that it "has been costly and harmful".

"The company deplores that despite long negotiations since the start... a fair and equitable proposal to end the conflict proposed by the management was not signed," by the unions, a statement said.

Air France has already implemented an ambitious restructuring plan to reduce costs and improve efficiency.

While Air France management agreed to scrap the development of Transavia abroad, it has vowed to maintain at least some part of its plans to enter the low-cost market.