October 31, 2020

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European Commission gives green light to KLM aid package

European Commission gives green light to KLM aid package

The European Commission has given the go-ahead for the €3.4 billion aid package for KLM. This is a EUR 1 billion loan from the Dutch State to the company and EUR 2.4 billion in guarantees for loans from 11 banks.

EU Competition Commissioner Vestager said in a statement that KLM plays a “decisive role” in the Dutch economy because of its jobs and its klm network.

“The crisis has hit the aviation sector particularly hard,” says Vestager. “With this state guarantee and a €3.4 billion state loan, KLM will have the liquidity it desperately needs to deal with the consequences of the coronavirus outbreak.”

According to the European Commission, the aid package meets the conditions set in the context of the Corona crisis. Brussels says the measure is “necessary, proportionate and proportionate to eliminate a serious disruption to a Member State’s economy.”

Job losses and wage casualties

The support package for KLM was presented almost three weeks ago. The Corona crisis has put the airline in trouble.

As a condition, the government wants KLM to cut costs by 15%, operate fewer night flights, and do more for sustainability. Minister Hoekstra (Finance) described the loss of jobs as inevitable.

The government also wants workers earning more than a tonne to be asked to pay at least 20% of their salary. Workers with lower salaries also have to enter, but less. In addition, no dividend may be paid.

Hoekstra explained at a press conference why KLM receives a support package: