After two months of negotiations, the Dutch government has agreed on a €3.4 billion support package for KLM.
The support package is divided into two parts: a €1 billion loan from the government, and a €2.4 billion government guarantee for a commercial loan, which KLM has acquired itself. Back in April, the government announced that they were looking into a support package of between €2 and €4 billion for the airline.
In this morning’s press conference, Minister for Finance Wopke Hoekstra said that the support package is intended to help the airline survive the coronavirus crisis. He also said that further support has not been ruled out, given that the aviation industry has been harmed more by the crisis than was originally thought.
The government is attaching some conditions to the loan. KLM needs to reduce its costs by 15%, reduce the number of night flights it does, and make an “active contribution” to sustainability. A “state agent” has also been appointed, to supervise the use of the money.
The support package took this long partly because it also needed to be talked over with the French government. KLM is part of the Air France KLM group, and the Dutch government did not want Dutch taxpayers’ money ending up in the French wing of the airline.
What are your thoughts on the support package? Should the government have put more conditions on the loan? Let us know in the comments below.
Feature Image: corgaasbeek/Pixabay
I’m glad to hear that no money is going to Air France. KLM should break off from Air France. It’s been an albatross around KLM’s profitability. Air France has lost money while KLM has made money for the group.