Finnair Cancels More Than 200 Flights on Wednesday

Finnair issued a profit warning Tuesday, saying it now expected an anticipated full-year operating profit to turn into a loss owing to a cabin crew strike, threatening it might move jobs out of Finland due to high labour costs.

“During the strike, the direct net loss to Finnair will be 2.0 (million) to 2.5 million euros (2.6-3.3 million dollars) per day,” the company said in a statement.

In Finnair’s third-quarter results, when it posted its first profit for two years, the company said it expected both the fourth quarter and the full year to be profitable.
Finnair said Tuesday however that “full-year operational result is expected to decline into a loss” due to arrangements that have to be made during the strike as well as a loss of bookings.

“We are now forced to consider significant structural changes… We have to look at what is cost-effective for us to do ourselves and what is better left to other partners,” Finnair chief executive Mika Vehvilaenen told reporters, adding he was deeply frustrated with the demands of unions in Finland.

Vehvilaenen said the company would begin looking at options including outsourcing operations, hiring labour from countries with more favourable labour contracts, and letting go of some of the routes it flies in Europe.

“Finnish jobs are now at stake,” head of communications Christer Haglund told AFP.

Even if a deal is reached with the Finnish Cabin Crew Union, Finnair will still investigate cost-cutting through these measures, said Vehvilaenen.

“These days they do very high-quality work much more cost-effectively in other places in Europe and outside of Europe too, in Asia, for example,” Vehvilaenen said, although he stressed that the company had not yet made any decisions to shift Finnish jobs abroad.

The Finnish Cabin Crew Union strike began at 1:00 pm (1100 GMT) Tuesday, after last-ditch efforts to resolve how night shifts and days off are organised failed.

Finnair said it had around 2,000 stewards, and most of them were participating in the strike.

State labour mediator Esa Lonka has not yet said when the two sides would return to the negotiating table.

More than 100 domestic and international flights were cancelled on Tuesday, affecting around 6,000 passengers.

Finnair has also cancelled more than 200 flights on Wednesday.


 

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