CEO insists KLM, Air France staff want to work together

by Andreas Spaeth
1021
June 07, 2019
Klm elbers power
KLM CEO Pieter Elbers.

February saw something unusual for the airline industry happen in Amsterdam: hundreds of KLM staff gathered at the airline’s headquarters in  Amstelveen, near Schiphol airport, to deliver a strong message in favor of the Dutch airline’s CEO Pieter Elbers.

They delivered a petition with no less than 25,000 signatures in support of Elbers remaining in his job and hoisted placards saying “Keep Pieter Elbers”.

Elbers’ four-year term was expiring in April and there were clear signs that the new Air France-KLM group CEO, Canadian Ben Smith, formerly with Air Canada, wanted to oust the popular and hands-on chief executive.

READ: United eco-fight showcases airline responses to climate change

Several Dutch government ministers also joined staff and the public in support of Elbers.

The Dutch part of the Air France-KLM joint venture, which started in 2004, is generally far ahead of its French partners in profitability and efficiency.

Bogged down by multiple strikes and soured labor relations, the French remain stuck in the era of state-owned carriers while KLM has become an advanced, cutting-edge airline.

Dutch finance minister Wopke Hoekstra summed up the feelings when he praised Elbers after his next term at the helm of KLM was secured by public and political pressure.

“He has done an excellent job at KLM in recent years,’’ Hoekstra said. “The government remains fully committed to protecting Dutch interests in Air France-KLM.”

Sources tell  AirlineRatings that the power struggle between Elbers and Smith is by no means over.

While Elbers is very approachable and much liked, Smith remains elusive, consulting an inner circle. He does not talk to the media or even his own staff.

Many key people in important Air France departments have never met their boss in person, though he took over in September 2018.

Elbers spoke to AirlineRatings on the sidelines of the IATA AGM in Seoul about the recent experiences.

“The public support felt like a combination of embarrassment and honor, I became a bit shy of it almost, but it felt very good in the end that KLM people showed their ‘blue heart’,” he said.

“It was a reflection of the changes we made together in the last couple of years.”

Elbers said management and staff had gone through some “bumpy rides’ together in a transformation that asked for more profitability and froze wages for a couple of years but had started to pay off in yield results.

He described the support in the company and from the public as “heartwarming”.

He stressed that KLM was in better shape now than a year ago, both financially and in terms of customer response.

Elbers is not part of Smith’s inner circle but embraces his new colleague on the Air France side even more emphatically.

“I am very glad Anne Rigail became CEO of Air France, we have a nice chemistry and she makes a lot of changes inside the airline which is good,”  he said.

Similar to Elbers, Rigail is a “hands-on CEO” coming from the product side of the airline.

“The people in Air France and KLM want to work together and all this governance discussion is sort of far away from them,’’ Elbers insisted.

“Both companies have a great history and fantastic brands with people being very proud of their jobs, it’s up to us as leadership to make it work.”

While in Europe the discussion about “flight shaming” is starting to become more widespread, Elbers doesn’t see flying as having an image problem overall.

“There is no resentment against flying but the wish to be flying in a responsible manner,’’ he said.

“Flying all over the world for just a couple of Euros people don’t find responsible and rightly so.

“The changing mood in the society is clear and we should embrace it.

“Yes there could be less growth going forward in terms of people reconsidering their flying, but that in itself is not bad.

KLM has a long history of putting sustainability high on its agenda.

At the IATA AGM, KLM unveiled a research study for a future aircraft called “Flying V”, the airline supports the technical university of Delft in its research.

The airline also recently announced it will be investing in biofuel producer SkyNRG, starting production in 2022.

“With what we see going on in society and with the responsibility we want to take we should try to revive biofuels and that’s precisely what we are doing,” Elbers said.

“We have committed to buy 70 percent of the biofuel production at SkyNRG for the next 10 years which will make us the immediate leader in biofuel consumption.”