Air France-KLM Group chief executive Pierre-Henri Gourgeon is meeting with unions today to discuss further cost-cutting measures.

An Air France-KLM spokesperson said that "we may have to do [structural] cost cuts as the economic context is not so good".

The Franco-Dutch airline increased the aim of its "Challenge 12" cost-savings programme from €470 million ($663 million) to €500 million for the current financial year after registering a net loss of €197 million during the first quarter.

In the corresponding period in 2010, the carrier had made a €736 million net profit.

A 16% increase in fuel costs, the political changes across the Middle East and nuclear crisis in Japan in spring were the main factors for the deteriorated results, the company said at the end of July.

Source: Air Transport Intelligence news