How airBaltic is dealing with the effects of the COVID-19 crisis

airBaltic is Latvia's flag carrier, with its Headquarters at Riga International Airport. The city serves as its hub, in addition to bases in Tallinn, Estonia and Vilnius, Lithuania. The airline had witnessed substantial growth in recent years with a record number of passengers transported in 2019, over €500 million in revenue, and over 80 destinations served. However, like most carriers, it has been hard hit by the COVID-19 pandemic.

Photo by Jero Vida | AeroNewsX

The most substantial effect has been the temporary suspension of the airline's operations on 17th March 2020, a decision that stemmed directly from the Government of the Republic of Latvia (which holds an 80% stake in the airline). The suspension is set to run from 17th March through to 14th April 2020, after which airBaltic says it would be forced to decrease its overall capacity between 15th April and 31st October 2020. This reduction will be approximately 50% of its flights.

airBaltic has a fleet containing three types of aircraft; the Airbus A220-300, Boeing 737-300 and Bombardier Dash 8 Q400. However the pandemic has led to the announcement of early retirement of the Boeing and Bombardier aircraft. Once restrictions are lifted the airline hopes to restart operations with five Airbus A220 aircraft, with the airline being a launch customer of the aircraft type in July 2018.

An open letter from the President and CEO of airBaltic, Martin Gauss, details a slow start to resuming operations, but with an optimistic view to the future.

According to Martin Gauss, "Over time, the demand for travel is expected to return. Therefore, we have adjusted our network so that we can continue providing air connectivity to the Baltics and eventually grow back to our previous levels."

The adjustment includes simplifying the operation with the use of only one aircraft type, with airBaltic having received its 22nd A220 late last year which was part of a deal signed in May 2018 to purchase 30 aircraft, and with the option to purchase an additional 30 of the same type. Once the operation restarts with five Airbus A220s, the plan is to gradually add one aircraft per week as demand resumes.

In his letter, the CEO also mentions the difficult decision to reduce the workforce by seven hundred, while retaining one thousand employees. He also promised to re-employ these workers as soon as possible. Many airlines are having to take these tough downsizing measures to ensure continuity once demand resumes. Thanks to the airline's strong cash position however, they will be able to pay employees until mid-May. The airline is also maintaining its fleet to ensure perfect technical condition to fly again, when possible.

It is still unclear as to what extent the COVID-19 pandemic effect will be. However, airBaltic, alongside all other airlines, is having to take these tough measures now in order to tackle the crisis.

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