FILE PHOTO: A KLM Boeing 737-800 plane lands at Tegel airport in Berlin, Germany, November 2, 2017. REUTERS/Axel Schmidt
October 31, 2020
THE HAGUE (Reuters) – The pilots’ union of KLM, the Dutch arm of Air France <AIRF.PA>, on Saturday declined to accept a wage freeze through to 2025, potentially endangering efforts to secure the company’s future amid the coronavirus pandemic.
It said it had already agreed to a freeze lasting until March 2022, and changing the agreement at short notice was not feasible.
Other unions representing ground and cabin crews have agreed to the prolonged wage freeze, which is set to last as long as the airline receives government support.
On Friday the government said it would withhold payments from the 3.4 billon euro bailout package KLM is due to receive unless the company adjusted its restructuring plan to include the freezes.
Air France-KLM on Friday reported 67% drop in third-quarter revenue to 2.52 billion euros, underlining the airline’s dire financial condition as a new COVID-19 surge poses further threats to an industry already crippled by the epidemic and a collapse in long-haul travel.
Air France-KLM has 12.4 billion euros in liquidity, thanks largely to a French and Dutch government-backed bailout, a cash cushion comparable to that of European peers Lufthansa <LHAG.DE> and IAG <ICAG.L>.
(Reporting by Stephanie van den Berg; editing by John Stonestreet)
