PARIS (dpa-AFX) - KLM Royal Dutch Airlines, the flag carrier of the Netherlands, Thursday announced its plans for Structural Changes to improve operational and financial performance. The measures would include increasing productivity, simplifying the organisation, cutting costs, and deferring or postponing investments. The company said KLM is suffering from high costs and shortages of staff and equipment.
Through the changes, KLM aims to improve operating results by 450 million euros.
In line with Air France-KLM's group ambition, this should lead to a structural profit margin above 8 percent by 2026-2028.
The list of measures include, the use of automation and mechanization to improve labor productivity by at least 5 percent by 2025, measures to resolve the impact of the pilot shortage, introduction of new products on board, and others.
The company added that trials are underway with an expanded catering offer and optimization of aircraft layout, aimed at increasing revenues by at least 100 million euros a year.
The measures also aim to curtail the rising cost of equipment, staff, and airport fees.
Furthermore, KLM is engaged in an extensive fleet renewal - a billion-dollar investment aimed at cleaner, quieter, and more fuel-efficient flying.
Marjan Rintel, CEO of KLM, said: 'Our aircraft are full, but our capacity is still not back to pre-corona levels. We want to remain at the forefront of customer and employee satisfaction as well as sustainability. To continue doing this effectively, we must make clear and decisive choices now. This is painful for every KLM colleague, but it is necessary, and it has to be done now.'
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