“We’re perfectly aware of the necessity to develop a low-cost brand for the group’s future. But we must first consolidate the two bases in France and Holland before opening new ones in Europe.” /photo DR
TourMag.com: The press talks a lot about the increase of an anti-French sentiment within KLM. What is happening really?
Steven Verhagen: I think this information is a pure product of journalists’ imagination.
People always ask us how Air France benefits KLM.
But we are married for better and for worse and have to show solidarity in the face of difficulties.
However, it is true that we had a hard time understanding how Air France’s management let this social conflict last for this long when it was just about a small part of the group’s global strategy, meaning Transavia’s development.
Steven Verhagen: I think this information is a pure product of journalists’ imagination.
People always ask us how Air France benefits KLM.
But we are married for better and for worse and have to show solidarity in the face of difficulties.
However, it is true that we had a hard time understanding how Air France’s management let this social conflict last for this long when it was just about a small part of the group’s global strategy, meaning Transavia’s development.
The necessity to develop a low-cost brand
TourMag.com: Exactly, what do you think of the development of Transavia France and dropping Transavia Europe?
Steven Verhagen: We are perfectly aware of the necessity of developing a low-cost brand for the group’s future.
But we first need to consolidate to the two bases in France and Holland before opening new ones elsewhere in Europe.
On the other hand, it is crucial to keep investing in the fleet to improve our product.
Unfortunately, this is not the strategy that the company seems to be taking. Because to compensate the losses incurred during the strikes, management now wants to slow down investments. I’m not convinced this is the right route to take.
TourMag.com: Do you think that the Perform 2020 plan is adapted to the challenges Air France - KLM faces today?
Steven Verhagen: We wish for management to specify more clearly the strategy it wishes to undertake. Because today, the implementing measures of Perform 2020 are still quite vague in my view.
I think that it would be too easy to ask pilots or employees to accept more compromises on their pay or working conditions.
We will soon meet with the new CEO, Pieter Elbers, in order to talk about the company’s future. But we are entirely convinced that a social constructive dialogue is possible within KLM.
We have to fight the enemy from outside instead of quarreling between ourselves.
Steven Verhagen: We are perfectly aware of the necessity of developing a low-cost brand for the group’s future.
But we first need to consolidate to the two bases in France and Holland before opening new ones elsewhere in Europe.
On the other hand, it is crucial to keep investing in the fleet to improve our product.
Unfortunately, this is not the strategy that the company seems to be taking. Because to compensate the losses incurred during the strikes, management now wants to slow down investments. I’m not convinced this is the right route to take.
TourMag.com: Do you think that the Perform 2020 plan is adapted to the challenges Air France - KLM faces today?
Steven Verhagen: We wish for management to specify more clearly the strategy it wishes to undertake. Because today, the implementing measures of Perform 2020 are still quite vague in my view.
I think that it would be too easy to ask pilots or employees to accept more compromises on their pay or working conditions.
We will soon meet with the new CEO, Pieter Elbers, in order to talk about the company’s future. But we are entirely convinced that a social constructive dialogue is possible within KLM.
We have to fight the enemy from outside instead of quarreling between ourselves.
Air France - KLM: the pilot strike has cost €416 M in revenues
As expected, the financial results in the third trimester of Air France - KLM are not looking good.
Due to the pilot strike, the company incurred a loss of €416 M in revenues, which includes the loss of sales and the need to protect passengers. However, it also saved €86 M in fuels and personnel wages.
In total, this social movement, the longest in its history, will negatively impact its turnover by 330 million euros.
But the pilot strike isn’t the only cause of that. “The demand in the Europe zone remains subdued, exchange rates are adverse to us and over-capacities continue, especially in Asia” explains Pierre-François Riolacci, Financial Director.
He is, however, very happy about the continuation of the drop of unit costs by 1.2%, for the 10th consecutive trimester.
“But we have to maintain our efforts in order to reduce further costs thanks to the Perform 2020 plans.” He specifies, however, that Perform 2020 will be less traumatizing than Transform 2015.
He also believes that the company will have to stall its investments, in the time to find more cash to invest. Money that could come from the transfer of shares that the company still holds in Amadeus (4.4%).
Due to the pilot strike, the company incurred a loss of €416 M in revenues, which includes the loss of sales and the need to protect passengers. However, it also saved €86 M in fuels and personnel wages.
In total, this social movement, the longest in its history, will negatively impact its turnover by 330 million euros.
But the pilot strike isn’t the only cause of that. “The demand in the Europe zone remains subdued, exchange rates are adverse to us and over-capacities continue, especially in Asia” explains Pierre-François Riolacci, Financial Director.
He is, however, very happy about the continuation of the drop of unit costs by 1.2%, for the 10th consecutive trimester.
“But we have to maintain our efforts in order to reduce further costs thanks to the Perform 2020 plans.” He specifies, however, that Perform 2020 will be less traumatizing than Transform 2015.
He also believes that the company will have to stall its investments, in the time to find more cash to invest. Money that could come from the transfer of shares that the company still holds in Amadeus (4.4%).
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