KLM takes action to strengthen its position and keep the Netherlands connected to the world

Marjan Rintel, President and CEO of KLM: "Every day, we all work with incredible dedication, commitment, and pride. But KLM’s future is not guaranteed. The environment we operate in is becoming increasingly complex, with global instability, high fuel prices, and growing pressure on the aviation industry. That’s why, at this pivotal moment for KLM, we’re taking far-reaching, sometimes painful measures. Every department and every division will be asked to contribute.

We're doing this with a clear vision for the future: one where KLM remains a great airline that connects customers to the world, a company people want to work for, and one the Netherlands can be proud of."

Building a Stronger Foundation
KLM has made significant progress in improving its financial performance in recent years, achieving structural improvements of more than €750 million. Alongside numerous initiatives across all divisions, the company has largely resolved its shortage of pilots and maintenance staff. Activities such as catering and maintenance are being outsourced, and the number of office buildings used by KLM is being significantly reduced. The office organization has also become considerably smaller through job reductions and leaving vacant positions unfilled.

However, these efforts are still not enough to secure KLM's future. This was reinforced by the future scenarios developed by employees and external stakeholders over the past few months. The scenarios showed that delaying necessary decisions would further limit KLM's strategic options.

Bas Brouns, CFO of KLM: "We need to strengthen our financial foundation to make KLM more resilient in the face of uncertainty and better prepared for the future. We need a KLM that can invest in a new generation of aircraft, better customer service, and our people.

These measures will help us increase revenue and further reduce our structural costs. We need to make a major leap forward. Improving our annual earnings by €1 billion is essential to delivering our strategy and focusing on what sets KLM apart."

Marjan Rintel added: "We'll closely monitor the progress of these decisions and measures. Further changes to the organization, employment conditions, productivity, and staffing may still be necessary."

Focus on Core Business: Network, Customer Relationships, and Operations
KLM will continue investing in its network and operating flights with a significantly simplified and modernized fleet of 185 Airbus, Boeing, and Embraer aircraft. KLM is making its operations more sustainable not only through a cleaner, quieter, and more fuel-efficient fleet, but also through numerous initiatives on the ground to reduce fuel consumption and emissions while improving working conditions.

KLM will also continue investing in passenger service and comfort. This includes new, more comfortable aircraft, improvements to onboard service, free high-speed Wi-Fi on intercontinental flights, and an expanded meal selection on European routes. Digitalization and AI will also help improve the flight booking experience and make work simpler and more efficient.

Making the European Network More Competitive
KLM is changing the balance between larger and smaller aircraft in its European fleet. The A321neo will remain part of the fleet, while smaller Embraer E195-E2 aircraft will replace the planned A320s. By operating more smaller aircraft, KLM can better match capacity to the demand across its European network. This will give KLM Cityhopper a greater role. The Boeing 737 and Embraer E190 will be phased out over the coming years. Simplifying the fleet will also streamline the organization and help KLM better manage costs and operations.

Available capacity will be allocated to routes that contribute most to passenger connectivity and the nonstop network from Schiphol. These and other measures are intended to restore profitability across the European network and support reliable operations.

A Smaller, Simpler, and More Agile Organization
KLM is sharpening its focus on core activities that directly benefit customers and strengthen its competitiveness. The company will take a different approach to activities that other parties can perform better, faster, or more efficiently. This means certain activities will be carried out with external partners, reorganized, or further consolidated within Air France-KLM. The proposed expansion of the Group to include SAS, which is currently under review by the European Commission, is expected to create additional opportunities for collaboration, synergies, and economies of scale across a strong European airline group.

Major initiatives include:

Work within Ground Services will be organized differently over the coming years.

• At Passenger Services, digitalization and new technology will give travelers greater control over check-in, boarding, and rebooking. Terminal employees will focus more on hospitality and direct customer service.
• Apron Services (for European flights) and Baggage Services will work with external partners. These partners will take over below-the-wing activities at KLM Cityhopper and baggage handling in the East Hall. As specialists in ground handling, these external providers can invest more and at a faster pace, while delivering services more efficiently and at a lower cost.
• The Hub Control Center at Schiphol will be improved through new ways of working, technology, and closer collaboration with external partners. This will help make better use of Schiphol's limited space and equipment, improving the coordination of passenger and baggage flows.

KLM Cargo will consolidate all cargo handling in its own warehouse at Schiphol, covering freight carried on both passenger and cargo aircraft. This will help prepare KLM Cargo for the new cargo terminal, scheduled for completion in 2035, and enable it to attract more transfer cargo passing through Schiphol. The company will also expand its services for customers requiring additional support. The increased cargo volumes will ultimately be handled without hiring additional employees. This will be achieved by simplifying processes, working smarter, increasing automation, and deploying employees across different activities

To provide KLM with the best possible support, Engineering & Maintenance will increasingly focus its expertise, people, and resources on the fleet of the future. This includes accelerating the phaseout of maintenance work on aircraft types being retired from the fleet. Wherever possible, maintenance will also be scheduled during existing ground time to maximize fleet availability. Smarter, more efficient ways of working in the engine and component shops will drive sustained productivity improvements and create opportunities for growth. In addition, KLM intends to align the management of Engine Services and Component Services more closely with Air France-KLM.

Greater Flexibility, Higher Productivity, and Lower Costs
Employment terms and conditions need to become simpler and more competitive. Continuing on the current path is not sustainable. At this critical point for KLM, decisions that were previously postponed can no longer be avoided. KLM wants to work with the unions to establish new collective labor agreements that are sustainable for the future. The company aims to achieve a structural productivity increase of at least 8% by 2028, combined with very moderate wage growth.

Impact on Employees
The number of positions at KLM, which has already declined in recent years, will decrease by almost another 15%. Approximately 5,000 positions have been or will be reorganized, with the work carried out differently. Since this spring, the work associated with 1,250 positions at KLM Catering Services has been carried out in partnership with gategroup. An estimated 800 positions in Ground Services will involve work that will be transferred to external providers in the future. In addition, 2,000 positions, including 1,500 at customer contact center Cygnific, will be transferred to Air France-KLM. Finally, the planned structural productivity improvements will result in approximately 1,000 fewer positions at KLM.

KLM expects to limit the impact on employees through natural attrition, voluntary arrangements, and transfers to other positions. Marjan Rintel said: " It’s painful to transfer activities that have traditionally been part of our company. This affects colleagues who have devoted their entire working lives to KLM and put their hearts and souls into their work. But doing nothing would ultimately have even more painful consequences, both for jobs and for our country's connections to the rest of the world. That's why we're taking action to make KLM stronger and more competitive. We'll do so with great care and respect, and through open dialogue with employee representatives, unions, partners, and other stakeholders."