Finnair embarks on EUR20m cost-cutting programme

Photo by Ufulum
Photo by Ufulum

Finnair is planning to embark on a new cost reduction programme through which it expects to save EUR20 million (US$22.5m) per year.

While the airline’s financial performance has generally improved over the last two years, in line with falling fuel costs, Finnair said that it is now targeting “permanent savings through various efficiency-improvement measures”.

“In order to be able to invest in growth and continue on our chosen path, we must ensure that our unit costs continue to decline. With that in mind, we are now… taking steps to deliberate together with our personnel about the measures we could utilise to improve our result,” said Finnair’s CEO Pekka Vauramo.

This comes despite Finnair returning to the black in the second quarter of 2016. Releasing its results on Wednesday, the airline revealed that its three-month operating profit reached EUR200,000, compared to a loss of EUR5.7m in the same period last year. Revenues increased 4.7% to EUR569.6m and unit costs decreased by 6.5%.

Details of the latest cost-cutting plan are expected to be finalised in the next few months.

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