The Dutch airline KLM, which merged with Air France in May 2004 to form Air France-KLM, is currently facing difficult times. That’s why it prepared an internal report outlining what KLM’s situation might look like in 2030.
And with options ranging from downsizing and transferring control to Air France-KLM to remaining independent through a single new collective bargaining agreement with lower salaries for the entire workforce, the outlook doesn’t look very promising.
Costs are rising faster than revenue
To say that changes are on the horizon is an understatement: they are coming, and they will be drastic.
KLM was long the most profitable division within Air France-KLM, but these days its costs are rising faster than its revenue. While Air France-KLM as a group posted record results in 2025 with an operating profit of 2,004 billion euros – a 430% increase compared to 2023 – KLM itself lagged far behind with just 416 million euros, barely higher than the previous year. Air France-KLM therefore did not achieve the 8% profit margin it needs to invest in fleet renewal.
KLM has been grappling with a major structural problem for years: KLM’s operating costs – especially wages – are higher than those of other airlines.
In recent years, a series of cost-cutting measures at KLM, including eliminating office jobs and selling the catering division, has already yielded savings of more than 450 million euros, but that does not seem enough.
To address this situation, a group of 37 KLM employees, in collaboration with a consulting firm and at the request of KLM’s top management, outlined 4 “futures” for the company through 2030.
Fewer destinations and less autonomy?
These 4 options are based on the following scenarios: downsizing and transferring power to Air France-KLM, with the parent company taking control; remaining independent through a single new collective bargaining agreement, while reducing costs by lowering salaries for the entire workforce; improving collaboration, both internally and externally – for example, with Schiphol, air traffic control, and the government; and fourth, taking no action at all, with risk of bankruptcy or drastic restructuring
Under the first option, for example, the technical department would be divested and ground handling outsourced, and KLM – which has always maintained a high degree of autonomy since the merger – would also fly to significantly fewer destinations.
That option – even though none of the 4 scenarios are predictions or action plans – is a real possibility: Air France-KLM is set to acquire the Swedish airline SAS and is in the midst of a bidding war to acquire the Portuguese airline TAP, so KLM’s role and importance could diminish in any case.
“Sense of urgency”
“In my view, the strongest message these scenarios convey is a sense of urgency,” says leading executive Marjan Rintel. “Waiting is not an option. Delay has consequences.” She also emphasizes that the future will likely include elements from all four of these scenarios.
In other words, the airline views the report primarily as the start of a discussion about the strategic decisions KLM will need to make.
“KLM faces important decisions,” says Rintel. “Our cost base is under pressure. The social and political debate about aviation has intensified. In some other countries, heavy investment and innovation in aviation are changing the competitive landscape. We must take these signals seriously and respond to them together.”
As a result, unions, employees, and managers at KLM face some tense months ahead, as tough measures are clearly on the way. It’s also clear things will be more than difficult, because the report explicitly states that “internal relations are too poor” and that “KLM isn’t stalling due to lack of solutions, but because it has become increasingly difficult to implement solutions collectively.”
