The strategy of Finnair has long been based on connecting Europe and Asia via the Northern route
Finnair’s new strategy to return to profitability
The strategy of the Finnish flag carrier Finnair has long been based on connecting Europe and Asia via the Northern route. The closure of Russian air space has extended the flight times and hence weakened the profitability of the airline. With a new strategy the company aims at returning to profitability reaching an EBIT level of at least 5% from mid-2024.
Some of the key actions to achieve this goal are a fleet optimization and further leveraging of partnerships such as the oneworld alliance and joint businesses. Finnair also aims at building a geographically more balanced network including a strategic partnership with Qatar Airways and a continued strong domestic presence, among others.
Company wins tender for five regional routes
Finnair recently won a public tender issued by the Finnish Transport and Communications Agency (Traficom) on state-subsidized scheduled air services between Helsinki and five regional airports. The flights are planned to begin on 31st October 2022 and will be operated by Nordic Regional Airlines (Norra), a subsidiary of Finnair, with 68-seat ATR 72-500 turboprop aircraft.
The tendered routes include flights between Helsinki and Joensuu, Helsinki and Jyväskylä, Helsinki and Kajaani airports, as well as triangular routes between Helsinki and Kokkola-Pietarsaari and Kemi-Tornio airports. The tenders cover the period 31st October 2022 and 30th July 2023 and include an option period lasting from 31st July 2023 until 28th April 2024.
The value of the contract for all routes without the extension is estimated at 13.7 million € and including the extension 17 million €. Besides Finnair three other airlines submitted bids for the tender, namely Amapola Flyg AB, DAT A/S and NyxAir OÜ.
There will be a maximum of two return flights per weekday on the direct routes and three triangular flights between Kemi-Kokkola-Helsinki. The flights to Jyväskylä will end already on 23rd June 2023.
Contract negotiations between Traficom and Finnair have started with the aim to commence the flights as planned on 31st October 2022.