KLM warns of further job losses if business deteriorates
KLM believes the 15% cut in capacity and the related cost-savings it has made this winter will be enough to counter the current decline in air traffic, but warns that forced redundancies will be unavoidable should conditions deteriorate further.
The carrier has already cut the equivalent of 2,500 full-time positions, half through ending temporary contracts and the remainder through the initiation of short-time working for around half its staff.
But speaking at a press conference in Amsterdam today, at which the airline revealed it will make a significant operating loss for the financial year, KLM managing director and chief financial officer Rob Ruijter admitted that the carrier has all but used up the flexibility inherent in its costs
“We’ve taken the appropriate measures for the current trading environment,” he says. “We’ve done everything we need to in the current environment.”
But he adds: “If we see demand drop any further, and we don’t see it [in our forward bookings] yet, it would mean cutting capacity further.”
This would then lead to further cost cuts and Ruijter warns that the airline has done the “easy bit” in cutting staff costs without forcing redundancies.
“We have made use of all the flexibility we have,” he stresses.
One further measure from which KLM still hopes to benefit is the part-deferral and part-reduction of planned staff salary rises. KLM has put a proposal to the unions and Ruijter says discussions are continuing but should be finalised before the end of November.
He would not comment on what effect such a step might have on helping to reduce any possible compulsory job cuts, saying: “It’s cash-management driven. That remains on the table and from a cash point of view would help tremendously.”