Path 27

French, Dutch ministers pledge to strengthen Air France-KLM

Path 27

PARIS (AP) — The Dutch and French governments kicked off a four-month project Friday aimed at making Air France-KLM more competitive — and at easing tensions between the two countries after the Dutch government’s surprise purchase of a new stake in the airline alliance without informing Paris.

The Netherlands’ finance minister, Wopke Hoekstra, and his French counterpart, Bruno Le Maire, held hurriedly arranged talks Friday in Paris and afterward both ministers pledged to cooperate to strengthen the uneasy alliance.

Le Maire, who described the discussions as “frank and clear,” said the two countries would work together “to improve the competitiveness of the group Air France-KLM and to make Air France-KLM a big success.”

KLM has cut jobs and costs and is more profitable than Air France, where an extended pilots’ strike last year shaved 335 million euros ($382 million) off revenue last year. The alliance as a whole is facing competitive pressure from low-cost airlines and growing Asian and Gulf carriers.

The two governments announced four months of consultations led by French and Dutch finance ministry officials to study the company’s ownership structure and management and how to protect the hubs at Amsterdam’s Schiphol Airport and Paris’ Charles de Gaulle Airport. In a statement Friday, they said the outcome of the discussions “must be a fair and balanced one for all sides.”

Trending:
Maskless GOP Rep Tells Pelosi to 'Come and Get Me' as Capitol Police Are Ordered to Arrest Those Who Don't Comply with Mandate

KLM’s success is closely intertwined with that of Schiphol Airport on the edge of Amsterdam; together, they generate tens of thousands of jobs and billions of euros in revenue.

Air France-KLM shares rebounded after the announcement Friday, having sunk earlier this week amid concerns about the stability of the alliance.

The Dutch government raised its share in the alliance this week to 14 percent without telling the French, angering France’s leadership.

The Dutch state had already owned a 5.9-percent stake in KLM, the national airline of the Netherlands. The decision to raise its share was intended to give the Dutch side more influence over the partnership’s future.

The French government also owns a 14-percent stake in the alliance, but Le Maire called the secretive Dutch move “incomprehensible” and French President Emmanuel Macron demanded clarification.

Hoekstra didn’t explain why the Dutch government didn’t discuss the purchase with French partners, saying only that the move had been discussed between KLM and the Dutch government. He said that the purchase showed his government’s commitment to the business and its partnership with France.

“We’ll look at the future,” he said. “We want to build a better company and we want to make sure the interests of both countries are taken into account.”

Showing his commitment to both airlines, Hoekstra tweeted later Friday that he flew to Paris on Air France and back home on KLM.

The two governments pledged support for Air France-KLM CEO Ben Smith, who has worked to settle labor disputes with Air France pilots since taking over last year.

Related:
San Francisco Tenants Being Paid to Leave Apartment Expose Problems with California's Rent Control Policies

The tensions reflect cultural differences in the two countries’ economic approach. The Netherlands has a long tradition of businesses working with labor unions and, where necessary, government to improve efficiency. France has extensive protections for workers and sees frequent conflict between unions seeking to save those protections and company management.

___

Corder reported from The Hague, Netherlands. Nicolas Garriga in Paris contributed.

The Western Journal has not reviewed this Associated Press story prior to publication. Therefore, it may contain editorial bias or may in some other way not meet our normal editorial standards. It is provided to our readers as a service from The Western Journal.

Truth and Accuracy

Submit a Correction →



loading

We are committed to truth and accuracy in all of our journalism. Read our editorial standards.

Tags:
Path 27
The Associated Press is an independent, not-for-profit news cooperative headquartered in New York City. Their teams in over 100 countries tell the world’s stories, from breaking news to investigative reporting. They provide content and services to help engage audiences worldwide, working with companies of all types, from broadcasters to brands.
The Associated Press was the first private sector organization in the U.S. to operate on a national scale. Over the past 170 years, they have been first to inform the world of many of history's most important moments, from the assassination of Abraham Lincoln and the bombing of Pearl Harbor to the fall of the Shah of Iran and the death of Pope John Paul.

Today, they operate in 263 locations in more than 100 countries relaying breaking news, covering war and conflict and producing enterprise reports that tell the world's stories.
Location
New York City




loading

Conversation