Dutch Airline KLM Downsizing Workforce as Virus Brings Losses

THE HAGUE, KOMPAS.com – Dutch airline KLM recently announced layoff plans following a “crisis of unprecedented magnitude” stemming from the coronavirus pandemic.

On Friday, KLM stated around 5,000 jobs will be cut.

KLM is part of the Air France KLM group and detailed that the layoffs will last until the end of 2021.

The Dutch airline found the trimming down of its workforce was necessary after it made massive losses.

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To counter the economic impact of the coronavirus pandemic on KLM, the Dutch government provided €3.4 billion or $4 billion worth of bailout funds.

Of the company’s current workforce of 33,000, around 1,500 compulsory layoffs will be conducted.

There would also be 2,000 voluntary redundancies announced earlier this year, while further cuts would be made through non-renewal of 1,500 temporary contracts.

"KLM is in the throes of a crisis of unprecedented magnitude... Expectations are that the road to recovery will be long and fraught with uncertainty," KLM said in a statement.

"This means that KLM’s structure and size must be rigorously adjusted even further in the years ahead. Consequently, a total of 4,500 to 5,000 positions in the entire KLM Group will cease to exist."

The jobs lost would involve up to 300 flight crew, 300 cabin crew, 500 ground staff, and around 400 jobs at KLM subsidiaries and in the Air France-KLM group positions.

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KLM said it would "keep open the possibility of further reductions" due to the "high level of uncertainty" in the airline business due to the pandemic, with demand not expected to recover until 2023 or 2024.

"It is incredibly difficult and sad for KLM to now have to bid farewell to valuable, committed colleagues," KLM CEO Pieter Elbers said in the statement.

KLM on Thursday reported an unprecedented €768 million loss for the first half of 2020, with passenger numbers falling 95 percent in the second quarter from nine million to less than half a million.

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Air France-KLM on Thursday announced a total second-quarter loss of €2.6 billion, adding that the twin airlines must "significantly reduce" the workforce.

KLM and Air France are among a host of European airlines given state support to get through the pandemic. 

(Writer: Agence France-Presse) 

Source: http://u.afp.com/386L