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KLM Confident in Winning Appeal to Block Schiphol Flight Cuts

Edward Russell

June 5th, 2023 at 5:27 AM EDT

KLM aircraft at Amsterdam's Schiphol airport

KLM and other airlines will head back to court later in June to face off again with the government of the Netherlands over its proposed flight cuts at Amsterdam’s Schiphol airport.

A Dutch court is scheduled to hear an appeal by the government on June 21. If the government wins, it plans to reduce total aircraft movements at Schiphol to 460,000 annually from 500,000 beginning in March 2024, and to 440,000 annually at a later date to reduce noise. At stake is the future of KLM’s hub at Schiphol, one of the “golden geese” powering the Dutch economy.

“We’re confident in the appeal,” KLM CEO Marjan Rintel said on the sidelines of the IATA Annual General Meeting in Istanbul Sunday. Any forced flight reductions at Schiphol should only be a “last resort” to reduce noise after aircraft modernization and other operational improvements, she added.

But the case is about more than just noise. It is also represents a blunt force attempt by the Dutch government to force reductions in aviation carbon emissions to meet its goals. The government has signed on to the European Union’s goal of reducing overall emissions 55 percent by 2030, and to net zero by the middle of the century. KLM, for its part, has committed to a 30 percent reduction in emissions per revenue kilometers flown by the end of the decade, and net zero by 2050.

KLM, IATA, and other airlines won their initial challenge to the Dutch government’s proposal in April. In its ruling, the court found that the government did not follow the “correct procedure” under European law. That procedure involves consulting with the industry over other measures to achieve noise reductions, and then only implementing flight reductions “if it is clear that other measures to limit noise nuisance are insufficiently effective.”

The ruling echoed what Rintel has described as a “balanced approach” to reducing noise, and more broadly aviation emissions.

If the Dutch government wins, the future of KLM’s hub would come into sharp focus. The airline would be unable to expand with new flights and instead be limited to growth by flying larger aircraft with more seats. That could translate to fewer new routes for the airline, and Schiphol ceding its position as a leading European aviation hub to others where airlines can grow. For KLM specifically, an inability to grow could boost unit revenues but also result in higher costs as capacity additions slow.

Rafael Schvartzman, IATA’s regional vice president for Europe, said flight reductions could also limit new competition at Schiphol with budget airlines unable to secure slots to expand. For example, JetBlue Airways sought U.S. government intervention in February after failing in multiple attempts to secure slots at the Amsterdam airport for new nonstops to Boston and New York. Two months later, JetBlue finally secured Schiphol slots for new New York flights to begin in August.

Schiphol airport has separately proposed new limits on flights. It wants to ban takeoffs from midnight to 6 a.m., and landings from midnight to 5 a.m. as part of its own effort to reduce emissions.

KLM and the larger airline industry oppose such limits at Schiphol and instead prefer their own approach to achieving net-zero emissions by 2050. That includes significantly boosting the use of low-emission sustainable aviation fuels, or SAFs, as well as developing new electric- and hydrogen-powered aircraft, and new carbon-capture technologies.

KLM has committed to sourcing SAF for 10 percent of its fuel needs by 2030. This is higher than the proposed EU mandate of 6 percent SAF for all flights within, to, and from the bloc by the same year.

However, Rintel emphasized that much still needs to be done to boost SAF production, which remains well below the demand. The fuels also cost four to five times more than traditional hydrocarbon-based jet fuels. Despite this, KLM has signed commitments to meet 4.5 percent of its global fuel needs with SAF.

“The supply is the issue,” Rintel said. “The EU should do what the United States is doing to [financially] incentivize SAF because we need supply and we need a lower price.”

Edward Russell

June 5th, 2023 at 5:27 AM EDT

Tags: Europe

Photo credit: KLM aircraft at Amsterdam's Schiphol airport Flickr / Steve Knight

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