KLM’s 5,000-Position Plan Targets €1 Billion More Annual Earnings

By Nathan Brooks

KLM said it will eliminate, outsource or transfer about 5,000 positions—nearly 15% of its workforce, or almost one in seven jobs—in a restructuring announced Thursday alongside parent Air France-KLM's third-quarter earnings.

KLM says the overhaul is designed to deliver an additional €1 billion ($1.1 billion) each year in earnings improvements. The company said the program is part of a broader effort to control costs and restore long-term competitiveness. It would lift KLM's total targeted improvement to €1.4 billion.

KLM reported third-quarter operating profit of €458 million, up €106 million. Air France-KLM reported group operating profit of €1.35 billion, and its shares rose about 12% after the results, according to Skift.

Marjan Rintel, KLM's CEO, said: "KLM's future is not guaranteed… That's why, at this pivotal moment for KLM, we're taking far-reaching, sometimes painful measures. Every department and every division will be asked to contribute."

What does this restructuring change for employees and travelers?

KLM said roughly 5,000 positions have already been or will be affected by eliminations, outsourcing or transfers within the wider airline group. It detailed the plan this way:

• Around 1,250 catering jobs have already moved to Gategroup.
• About 800 ground-services positions are expected to go to third-party providers at Schiphol and for KLM Cityhopper.
• Around 2,000 positions, including 1,500 at contact center Cygnific, will transfer to parent Air France-KLM.
• Another 1,000 reductions are planned through productivity gains.

Rintel said KLM's cost base remains too high despite the stronger quarter. She warned that further changes to staffing and employment conditions may still be necessary, while KLM is seeking union agreements covering at least an 8% productivity improvement by 2028 and restrained wage growth.

For employees, the restructuring reaches beyond layoffs. Gategroup assumes catering work, third-party providers are expected to take over ground services at Schiphol and for Cityhopper, and 2,000 positions move into Air France-KLM. KLM's union agreements add another lever: at least 8% more productivity by 2028, alongside restrained wage growth.

The operational changes for travelers are a revised aircraft mix and more digital touchpoints at check-in, boarding and rebooking. Rintel's comments make the cost base, rather than any single product decision, the central constraint.

Fleet and technology shift

KLM is resizing its European fleet around A321neos and Embraer E195-E2s. A321neos remain in the plan, while the E195-E2s replace previously planned A320s. Older 737s and E190s will phase out, and Cityhopper's role across Europe will expand.

At Schiphol, KLM plans to automate cargo handling. The airline also plans to digitize check-in, boarding and rebooking. That places airport labor, vendor contracts and digital systems inside the same cost program rather than treating them as isolated initiatives.

Better profit does not end the pressure

The quarter's improvement gives KLM a stronger starting point for the overhaul. KLM's €458 million operating profit, Air France-KLM's €1.35 billion group operating profit and the roughly 12% share-price rise sit alongside Rintel's warning that KLM's future is not guaranteed.

But Rintel's warning matters more for practitioners: stronger earnings have not fixed the cost base she says remains too high. The practical stakes are who carries the productivity burden, how quickly outsourcing and transfers take effect, and whether the revised fleet and digital systems can deliver the earnings improvement.

For employees, suppliers and European travelers, the measurable test is whether KLM turns labor, fleet and technology changes into the full €1 billion in added annual earnings. Until then, the restructuring remains a promise supported by a profitable quarter, not a completed cost reset.