Dutch airline KLM announced on Thursday a comprehensive package of “aggressive” cost-cutting measures that it hopes will lead to an increase in operating profits of about 450 million euros ($496 million) “in the short term.”
There was no specific mention of job cuts, but the company pledged to “explore options for outsourcing, divesting or discontinuing activities that do not directly contribute to aviation operations.”
KLM said it would reconsider and postpone all new investments, including its new headquarters and engineering buildings.
According to the company, labor productivity should be boosted by at least five percent by next year, through automation, mechanization and reduction of absenteeism.
“We will do everything we can to maintain our network and services to our customers and protect jobs across our company,” the airline’s CEO, Marjan Rintel, said in a statement.
“This is painful for every KLM colleague, but it is necessary, and it must be done now,” Rintel added.
According to the latest set of results, together with partner airline Air France, the group’s second-quarter profits amounted to €165 million – well below expectations.
A decline in passenger traffic due to the Paris Olympics has led to a decline in ticket sales, as tourists avoid the French capital during the games.