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Job loss fears at Air France/KLM

Wednesday, October 29, 2014 - 01:55

Air France-KLM plans to limit investments and accelerate cost controls next year to mop up the remaining impact of a recent pilots' strike. As Hayley Platt reports that hasn't gone down well with staff who fear big job losses.

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A costly pilots' strike and renewed competition from rival Ryanair clipped the wings of Air France/KLM. The airline's profits in the third quarter more than halved to 247 million euros. Revenue also fell 6.7 percent. The news pushed shares down almost 4 percent, adding to a 40 percent loss over the past six months. The group says it will limit investments and speed up cost controls next year to make up for the losses. It denies big job cuts at KLM are on the way. But Dutch unions believe there are plans to axe 7,500 staff - a quarter of the workforce. (SOUNDBITE) (English) CHAIRMAN OF 'DE UNIE' TRADE UNION FOR AIRLINE PERSONNEL, REINIER CASTELEIN, SAYING: "We are going to stop this programme and we are going to fire KLM staff and outsource them to different companies where KLM can buy these services back on cheaper basis. That's new, and it's not a rumour, it's one of the cases they are investigating." The 2-week long strike last month over plans to expand low-cost subsidiary Transavia, cost more than 400 million euros in lost revenue. That knocked back the group's debt reduction programme. Air France/KLM still plans to expand into the budget arena, like rival Lufthansa. But it needs to reduce its costs if its to compete with other budget carriers and those operating in the Gulf. The Dutch unions are now calling for talks with KLM. (SOUNDBITE) (English) CHAIRMAN OF 'DE UNIE' TRADE UNION FOR AIRLINE PERSONNEL, REINIER CASTELEIN, SAYING: "It's going to be announced in December and that's what we are talking about, I think that's rather late. I think that keeping people insecure until December and making announcement just before Christmas, I think that's giving a lot of people heartache during Christmas." Air France/KLM isn't the only airline facing headwinds. Europe's weak economy and concerns over Ebola are piling the pressure on many others too.

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Job loss fears at Air France/KLM

Wednesday, October 29, 2014 - 01:55