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Air France-KLM to cut cost, cites "uncertain" outlook

Air France-KLM planning major cost cuts

Sep 07, 2011

According to the report in French daily Les EchosAir, airline Air France-KLM projecting annual cost savings of 700-800 million euros ($988.8 million-$1.13 billion) to help it cope with economic uncertainty.

The cuts would go beyond this year's planned savings of 470 million euros, the newspaper said, citing unnamed sources.

Chief Executive Pierre-Henri Gourgeon addressed union representatives earlier on Monday and warned the group would have to cut its growth targets, citing an "uncertain" outlook, the report said.

In addition to a salary freeze and a cut in capacity growth for next summer, divisional heads have been asked to come up with additional cost savings by the end of the year, it said.

An Air France spokesman declined to comment.

A decision over the purchase of around 100 long-haul planes is expected "in the coming days," the newspaper said. Its Monday edition said the order could be reached during a board meeting in New York on Sept. 15.

Air France-KLM planning major cost cuts
Source: Les EchosAir/Reuters

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