Airline KLM has denied reports in Tuesday’s AD that it plans to lay off 7,500 workers in a far-reaching reorganisation.

The merged Air France-KLM group is due to publish its third quarter figures on Wednesday and has already issued a profit warning due to the pilots strike this summer.

But union chiefs told the AD they expect KLM’s new president director Pieter Elbers to announce major cuts in an effort to stem the group’s losses and reduce its debts.

KLM on Tuesday denied the claims and said the story had ‘come out of thin air’.

One of the reasons former KLM president Camiel Eurlings is said to have stepped down earlier this month is his opposition to demands KLM pay towards the impact of the Air France pilots strike.

Broadcaster Nos published an analysis on Tuesday showing that KLM’s personnel costs put it at a serious disadvantage compared with low cost carriers.

KLM spends an average of €76,000 on each member of staff, compared with Ryanair’s €49,000, Nos said. At the same time, Air France-KLM have to compete with Middle Eastern intercontinental carriers which benefit from low taxes and cheap fuel