Air France-KLM to cut 3,000 jobs

The airline industry has seen slowing demand

Air France-KLM is expecting to shed 3,000 jobs in its current financial year, in a bid to further cut costs.

The cuts come in addition to 2,700 posts eliminated in the fiscal year to 31 March 2009, as the airline industry suffers a fall in demand.

Chief executive Pierre Henri Gourgeon made the announcement after the airline released better-than-expected results.

The firm's quarterly loss narrowed, beating expectations, helping push its shares 11.4% higher on Wednesday.

The firm separately announced a tie-up with Delta Airlines on selected routes to share revenues and costs.

Delta is the world's largest airline, while Air France is the largest carrier in Europe.

The deal, which is initially for a 10-year period, covers all flights between North America and Europe, Amsterdam and India, and between North America and Tahiti.

No dividend

Airlines worldwide have been hit by lower demand following the global slowdown.

The firm saw a net loss of 505m euros (£444m) in the three months to 31 March, compared with a 534m euro loss in the same period a year earlier.

For the year to the end of March, the company saw a better-than-expected operating loss of 129m euros, from a profit of 1.4bn euros a year earlier.

Looking ahead, the firm declined to give an outlook for the year, except to say that it was "challenging".

It has scrapped its dividend and raised its cost savings target to 600m euros for 2009-2010.