Air France-KLM said to be considering replacing Dutch chief
There are concerns Elbers may not fully support plans to strengthen ties between the carriers
Air France and KLM merged in 2004, and have operated semi-independently since then, with the French government owning a 14 per cent stake. Photograph: Michaela Handrek-Rehle/Bloomberg
Mr Smith, who took the helm of the holding company in September, is keen for the heads of the Air France and KLM units to work closer together and back his drive to centralise more operations, according to sources. For example, the chief executive wants to end the current practice of the airlines separately negotiating plane purchases and alliances, they said.
Elbers’s current contract expires at the time of KLM’s April agm and the deliberations are focused on whether or not to extend his four-year tenure, sources said. The Dutch national is concerned that KLM will be dragged down by its worse-performing partner, one person said.
The two national carriers merged in 2004, and have operated semi-independently since then, with the French government owning a 14 per cent stake. Air France-KLM declined to comment. A spokeswoman for KLM said Elbers’s future was a matter of concern at the airline, and almost 13,000 people have so far signed an online petition calling for him to stay on.
While Smith, a 47-year-old Canadian, took over Air France-KLM at a time of labour turmoil and costly strikes that claimed the job of his predecessor, a truce with most unions and progress with pilots have allowed him to turn his attention to other parts of the business. Challenges include tension surrounding higher profit margins at KLM, which Smith has made clear he wants to resolve.
To that end, Smith is seeking to join KLM’s supervisory board, according to one person familiar with that matter. That’s likely to be opposed by executives at the Dutch carrier, who have sought to maintain independence from its French partner in the past.
Air France-KLM shares have gained 10 per cent this year, following a 30 per cent plunge in 2018. They traded down 2.3 per cent to €10.46 in Paris.