Thursday 24 September 2020

KLM to cut workforce by up to 5,000 as passenger numbers plunge 95%

Photo: DutchNews.nl

KLM is to cut its workforce by between 4,500 and 5,000 full time jobs in the coming years as income plummets due to the coronavirus crisis, the Dutch flag carrier said on Friday.

Some 1,500 temporary contracts will not be renewed and some 2,000 jobs will go through a voluntary redundancy scheme. But some 1,500 people will lose their jobs, including ground, cabin, cockpit crew and administrative workers.

The airline has been hit by a 95% drop in passenger numbers and booked an operating loss of €493m in the second quarter of the year. This takes the first half loss to around €800m, and, according to chief executive Pieter Elbers, the worst result in the company’s history.

The airline also expects to have to repay €1.6bn to consumers whose flights have been canceled.

Elbers said in a statement that the redundancies are both difficult and sad. ‘A great deal has already been done in recent months with respect to adjusting the size of our company in the face of a new reality,’ he said. ‘Unfortunately, more measures are needed in the short term to guarantee KLM’s continued existence in the future.’ 

The government agreed to bail out KLM to the tune of €3.4bn through loans and guarantees, after passenger numbers plummeted to virtually zero as countries around the world went into lockdown or closed their borders.

The package is not without conditions and KLM has been told to bring down its costs by some 15% – equivalent to savings of around €1.3bn.

Trade union FNV said in a reaction that the airline should not be sacking anyone. ‘We are going to look very carefully to establish if this number of jobs matches the expected shrink in company operations,’ cabin crew union spokeswoman Birte Nelen told broadcaster NOS.

KLM currently has a workforce of around 33,000.

KLM’s parent company Air France-KLM booked a loss of €4.4bn in the first six months of the year.

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