KLM to cut 500 jobs and reduce capacity
KLM, the Dutch flag carrier, said on Monday it would cut up to 500 jobs as it reduces capacity later this year in response to the slowdown in global air travel.
The airline said it would reduce the number of seats in this year’s winter schedule by 3 per cent, compared to the same period last year. The job losses among its 28,000-strong workforce would all be achieved by natural wastage, the airline said.
The cutbacks, which come into effect at the end of October, were announced at the same time as KLM revealed passenger traffic was flat in July, despite a 2 per cent rise in capacity. July and August are traditionally the two strongest months of the year for northern hemisphere airlines.
Cargo suffered even more from the economic slowdown with traffic down 7 per cent last month against a 2 per cent rise in capacity.
Network carriers around the globe are feeling the effect of the economic slowdown, as corporate travel budgets are slashed and the more profitable business traffic dries up.
KLM flagged up the cutbacks in capacity in late July when it reported that first quarter net profits more than halved to E19m ($17m) and warned that full-year earnings would come in “well below” those last year.
The airline will mainly reduce capacity by cutting frequencies from Amsterdam on a number of routes, including Dubai, New York, Tel Aviv and Vienna. It also plans to ground a second B747 jumbo jet.
KLM is also increasing frequencies on some of its more profitable routes, including Hamburg and Milan.