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Executive Development Partner
In cooperation with:

Pieter Elbers, President and Chief Executive Officer, KLM
» Interview
01/08/2017

London City Airport - proud sponsor of the Air Transport News interview programme

London City Airport is celebrating its 30th anniversary year in 2017.  Officially opened by Her Majesty The Queen on 5 November 1987, the airport has welcomed more than 50m passengers and 1.5m flights over the last three decades.
LCY is a first choice for business travellers to and from the UK, and is loved for its location just minutes from Canary Wharf and the City of London, the speed it offers to passengers with a quick check-in (20 minutes door to lounge) and quick arrival (15 minutes tarmac to train), and excellent customer experience, with unlimited free wifi for all passengers, free drop-off, and a business-class feel throughout.

The only airport actually in London, a major expansion programme is underway to increase runway and terminal capacity at LCY, enabling it to welcome 6.5m passengers and 111,000 flights per year by 2025.

In the meantime, a £20m upgrade to departure gates is now open and new routes continue to launch, with Berlin, Cardiff, Rennes and Bergerac amongst the latest to join the LCY network.

Find out more at www.londoncityairport.com

HAPPY BIRTHDAY LONDON CITY AIRPORT!

 

Interview of the KLM President and Chief Executive Officer, Pieter Elbers

 

ATN: What is the impact of the uncertain current environment: Brexit, the new US government, the terrorist attacks and demographic changes for KLM?

PE:  Well it's very difficult to predict  what exactly it would be but if we look to our actual traffic figures in the first five months of this year and most recent is June, over the last half year: The KLM Group grew in the first half of 2017 by 11% and almost 20 million passengers. This puts KLM well on track to meet its 2017 target of more than 40 million passengers for KLM and Transavia.  And again,  if we look to the rituals of May we have seen a significant growth -I believe it was 10 or 11 percent more passengers in KLM than the year before- so we have rather a healthy development of our traffic.  Going forward again it's going to be difficult to predict but  the  first five months were good.

 

ATN:  Which are the main  challenges for KLM?

PE:  The main challenges of course are certainly to circle around this uncertainty in the world, to make sure that we find a good way of dealing with these uncertainties. I think this is going to be every airline's concern and it is the same for us. Specifically for KLM  at Schiphol we do have some sort of capacity  constrains,  where one of the challenges  is to make sure that we have adequate airport infrastructure in place in line with our capacity  growth. • In order to ensure that KLM is the most customer-oriented, innovative and efficient network carrier in Europe, despite the heavy competitive market and the temporary low fuel price, we must continue to invest and can not rest on our laurels

 

‍‍ATN: ‍Are you happy with your traffic  figures in the past year? What is the  percentage of KLM passengers?

PE: The first months of the year were very strong; Junewas extremely strong; and as such we are very satisfied and we see it also  as a good proof that  our strategy we have embarked  is working out quite well. : Two thirds (2/3)  of all KLM passengers are connecting at Schiphol airport.

 

ATN: Which are your (network) goals for the next year?

‍‍PE:  Our goal  basically is to continue with the same strategy as we have, which is a more dynamic way of  network planning and opening and closing of routes; you're aware that we  opened up a record  new destinations in 2016 and we basically continue on the very same track in 2017 so,  the more dynamic allocation of fleet and more higher-level  fleet  utilisation, and such fleet utilisation  it enables to do more with the same number of aircraft. We will continue with cost reductions, so we can go on with our investments. We also, have the ambition to invest around EUR 800 million a year in the renewal and upgrade of our fleet, new products and services for our customers and improvements to our working methods (Ipads on board). We will Continue to further enhance our customer focus and appreciation. Digitalizing is a crucial element of this and really connected to the brand of KLM.

 

ATN: Do you have a specific region in mind that you wish to focus for any new routes?

PE:, the strength of KLM  is that we do have a worldwide network:  with KLM & Partners from SPL we have over 70 destinations in Europe, we have some 65 direct destinations in long-haul and our philosophy really is to make sure that we continue to have a worldwide and global presence and one of the strengths of our network is to have this  global presence  and even regions that were a bit under pressure last year like Japan and Brazil , are doing quite good this year in 2017. So,  the sort of  results strengthens  our philosophy that is good to have such a worldwide operation.

 

ATN: Are you planning to replace or expand your narrow body fleet?

PE:  We do have a fleet of almost 50 737's, 700's  and 800's there are no  short-term plans to replace this fleet; On the medium term we are still considering various options. On the regionalfleet that we were also having 50 we're in the process of phasing  out our FOKKER AIRCRAFTby the end of this year or our focus will be phased out and we will be the largest operator of Embraer aircraft in Europe.

 

ATN: Recently IAG launched a low cost airline focusing on long haul operations. Air France also announced the Boost project. Are you planning to be part of the Boost project or launching a similar project?

PE: No, we embarked actually three years  ago on the program for KLM  whereby  we increased productivity and have launched a whole range of  activities to reduce our cost of the long haul and also medium haul  operations. These initiatives have been quite successful because we saw a good Improvement of the results  last year  and we a see good development too  this year so, for KLM,  we would put all  efforts and energy  into  improving our present operation  and for KLM we no plans to start a  separate operation like Boost next to it. 

 

ATN: What is your strategy for Transavia for the following years? 

PE: Transavia has made a very  impressive  shift from a carrier which was predominantly or mostly operating charter flights and a few scheduled  flights to an almost all scheduled  flights  airline and that has been very significant shift where  clearly the charter business changed a lot and  therefore Transavia  had to change too.  So, now that  that has been done  and some more steps have to be made for Transavia  and we're clearly now checking with Transavia  how we can further optimize the cooperation and the level of coordination in Transavia   and Netherlands and KLM  and we do that by having some  code shares of KLM  on Transavia' flights, we work on some cooperative contracts, we make some different forms of  cooperation.

 

ATN: Last November after a long break you started again cooperating with London City Airport. Have you reached your goals in terms of traffic? Are you planning to expand your cooperation?

‍‍PE:  Clearly,  it is quite a part of our strategy again, a  decision which was laid down at the end of  2014 was that in order to be  strong in Europe we need to have a strong network and basically do some of the routes  with partners but the vast majority of the routes should be operated by ourselves.  So on some routes where we used to have partners like Dublin and London City we're now start our own operations with blue aircraft, with our own service with our own philosophy and basically London City Airport is  helping that we're still working on getting the schedules more optimized and even better for specifically the business  and traffic.  Clearly the whole brexit situation is also putting some uncertainty on London city but  overall we're quite successful and quite pleased with the  initial success of London City Airport.

 

ATN: KLM takes a next strategic social media step with flight info on Twitter and WeChat. Do you believe that this will improve the customer experience? 

PE: It is a very important part for us, the  digital strategy and the digital experience of the customers are increasingly relevant for the overall  customer experience. So,  KLM  has been a pioneer  when it comes  to the use of social media and digital technology for quite a number of years  and you may remember that after the 2010 incident with the aerospace closing because of the ash cloud from the eruption of the Eyjafjnallajokull volcano in Iceland ..

KLM was really one of the first one  to extensively use social media.  After that we have continued  to  develop on that and after the initiatives that we had with for example the  Facebook Messenger was done last year, we have now started with Facebook and Twitter and WeChat to make sure  that our customers can  stay on the same platform. So, our strategy is one to work on digital and two to make sure that we are where are customers are.  

 

ATN: In 2019 KLM will celebrate its 100 years anniversary, what are the  key points of your success?

PE: Innovation and pioneering. There are not  many companies who achieve 100 years of continual operation, I think we are still the only airline in the world  still operating under its original name, we were not the first Airline but as far as operating under its original name we are still the only one in the world.  So, obviously it is a big  milestone for KLM  and, I should say,  a testament to all these people working for KLM  all these years and made sure that we could do what we are good at pioneering, developing new things, exploring new  roads and basically continuing, if I may say so, in the dream and in the passion of our founder Albert  Plesman who said that "The Ocean of the Air Unites All People".

 

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