However, our group’s strong financial position, our strategic assets, resolute policy concerning cost savings and investments, and the flexibility of our staff and our organisation will all help us withstand this turbulent period.
The sector as a whole concluded December 2008 with a 22.6% drop in air cargo year-on-year. Cargo load factor for all of 2008 dropped by 4.0%. Passenger traffic showed a slight drop at 1.6%. According to International Air Transport Association (IATA) chairman Bisignani, 22.6% less air cargo is tantamount to free fall. “Even in September 2001, when much of the global fleet was grounded, the decline was only 13.9%,” he said. Airlines registered a USD 5 billion loss in 2008, in total. This coming year is shaping up to be one of the toughest years ever for international aviation.

Fierce Competition, Tight Margins, Careful Choices

Global market deregulation, the advent of low-cost carriers, and industry-wide consolidation have resulted in fierce competition. Compared to other industries, the profit margins in our sector are very tight. Under these market circumstances, responsible business practices demand careful strategic choices. Efficiency is a core value as it leads to greater profitability and less environmental impact. This is in line with strategy KLM has devised – growth through social and financial excellence and leadership in environmental policy.

Fewer Flights Not Realistic

Air transport carries over 2 billion passengers annually. Tons of cargo shipped by air each year represent 35% of the total value of export trade in manufactured goods. In an increasingly global society, the demand for mobility stays high. Long-distance travel has become an immutable part of our global economy, and flying is often the only option. Air transport is a driving force behind human and economic progress, not only in industrialized and developing nations, but also – perhaps even more importantly – in the world’s poorest nations. Moreover, air transport facilitates the personal freedom to travel.

Investment in Sustainable Growth

In spite of the uncertainties KLM aims to achieve profitable growth, in a sustainable manner. 
We are working towards this by investing in new aircraft that offer travelers greater comfort while reducing fuel consumption, noise impact, and emissions of greenhouse gases. And we can achieve even more by improving infrastructure and air traffic management. According to Eurocontrol, the optimization of European air traffic control could reduce fuel consumption by 6-12%.