Air France-KLM's Dutch arm goes to battle over Elbers's fate

Long simmering tension within Air France-KLM erupted into the open after managers at Dutch arm KLM warned of possible strikes and employee unrest should Pieter Elbers be removed as head of the unit. “The possibility of an unexplainable, involuntary departure of our CEO brings a lot of tension in the workforce,” a group of managers wrote in a Feb. 8 letter seen by Bloomberg to the Air France-KLM board. The move “will certainly lead to social unrest and possible industrial actions.” The KLM managers asked the carrier’s directors to renew Elbers’s mandate at their next meeting on February 19. The Dutch offensive is the latest challenge facing Air France-KLM CEO Ben Smith, who took the helm of the troubled airline in September following a series of crippling strikes at the French arm. The parent company is considering replacing Elbers over concern he may not fully support plans to strengthen ties between the two carriers, which came together in a 2004 merger yet have long operated semi-independently and suffer a cultural divide. The letter takes direct aim at the leadership of Smith, who has reached agreements with unions in France, and has made clear the need to bring Air France’s profit margins to a similar level as at KLM. He is seeking to join the supervisory board of KLM. The unfolding spat has also taken on a political tone. Dutch Finance Minister Wopke Hoekstra will seek to discuss Elbers’s position at KLM during a meeting Monday in Brussels with his French counterpart, Bruno Le Maire, according to a spokesperson for the Dutch government. <br/>