The French and Dutch governments agree to shell out over €10bn in financial aid to bail out their respective national airlines. But while the money may be enough to save the two airlines, it may doom the close business ties between the two. KLM, which is better managed and in better financial shape, expects it will need just €2bn and 4bn, whereas Air France would be unable to survive with less than the €7bn that’s now on the table. KLM believes Air France needs to cut expenses drastically and has warned it might be necessary to downgrade their relationships to mere coordination.
The finances of both airlines have been brought into sharp focus the coronavirus crisis, which has grounded almost the entire fleet without reducing much of their costs.
