PARIS, March 20 (Reuters) - Air France-KLM said it had reached an agreement with French unions to renegotiate working conditions as it seeks to cut costs and stabilize its 6.5 billion euro ($8.6 billion) debt.
The so-called methodology and framework agreement was signed with most of the unions representing ground staff, cabin crew and pilots, Europe’s biggest airline by revenue said in a statement on Tuesday.
The deal is “a first step in Air France’s transformation process” and paves the way for a new set of labour agreements to be concluded by June, the company said.
Air France-KLM swung to a 353 million euro operating loss last year, squeezed between soaring fuel costs and weaker pricing as Europe’s economic slowdown hurt demand.
The company is seeking 2 billion euros in annual savings aimed at reducing net debt to 4.5 billion euros by the end of 2014. ($1 = 0.7552 euros) (Reporting by Laurence Frost; Editing by Helen Massy-Beresford)