Pilot Strike Last Year Hits The Bottom Line Hard

A 14-day pilot strike last year has cut into profits at Air France-KLM, which is now stepping up its cost-cutting measures in an effort to offset some of the losses.

Buying Business Travel reports that the strike, which was in protest of the carrier's plan to expand its low-cost subsidiary Transavia, slashed the equivalent of $483 million in profits, and offset savings from lower fuel costs.

As a result, the airline said it was eliminating 800 jobs and cutting investments by $683 million. Airline executives said they would also accelerate other cost-cutting measures.

Air France-KLM CEO Alexandre de Juniac said he is looking for a "deep transformation" in the company. "With the way we see the market developing, except for the North Atlantic, we are being very, very cautious," he said.

Buying Business Travel reports that the company will stick with its "Perform 2020" plan to invest more than a billion dollars into Transavia, which is expected to lead to the hiring of 250 new pilots by 2019 and grow the low-cost carrier's fleet to more than 100 airplanes.

FMI: www.klm.com/corporate/en/about-klm/air-france-klm