Finnair is on the verge of firing hundreds of cabin crew workers. This will be part of an uptick with employment terminations following the closure of Russian airspace, which has affected many long-haul flights and operations to Asia.
Subcontracting cabin crew roles
In essence, Finnair is looking to form collaborations with any strategic partners that can offer support services in key markets for a mutually beneficial relationship. The recent geopolitical events, such as the closure of Russian airspace, have affected their bottom line and are one example of some of the strategies it has on how to reduce unit costs and strengthen revenue.
Last week, discussions with the carrier centered around long-haul crew utilization efficiency and airline policies. There were also discussions about layover hotels and additional pay that goes to long-haul flights. After this date, Russian airspace was closed and flights to Asia were snarled. In a statement released by the carrier, it was confirmed that the company did find a solution with some of their employees but not with Finnish cabin crew members.
As many as 450 jobs are in danger of being cut due to legal issues.
Finnair is negotiating with partners to provide the service on a larger variety of destinations. Following these negotiations, Finnair could hand over the task to subcontractors by early 2023.
At the time, Finnair is expecting the move to reduce around 450 in-flight jobs. The company is discussing a social support program to help those who could lose their work in re-employment with negotiations starting on November 23rd and last at least six weeks. Peter Lagerstedt, CEO of Finnair, said “‘The redundancy process will start on December 26th and be completed before the beginning of 2019.”
Our target continues to be finding a way to keep our inflight service affordable and save money with our passengers. We’re continuing discussions and working with the decision makers in this process to find solutions that would allow us to continue inflight service.
On September 1, the airline made an announcement stating that it would be negotiating new organizational changes. This could result in around 200 jobs lost. At the time, it was clarified that the great majority of jobs to be cut were among executive and management team members as well as international employees.
Having a long and difficult journey ahead of us
Finnair’s revenue increased by 260.6% between July and September this year compared to last year, which contributes to a net result of -$38 million (-€37 million) for the quarter.
Finnair’s CEO, Ms. Jari Manner, revealed that not only is fuel prices on the rise and both the US dollar and euro stronger than anticipated, but also that turnaround efforts have been more demanding than expected. Despite these challenges, however, Finnair’s earnings did turn positive for the first time since the last quarter of 2019.