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News Analysis: Finnair flight operations to be "less Finnish"

English.news.cn   2014-06-30 08:04:09

by Juhani Niinisto

HELSINKI, June 29 (Xinhua) -- While Finnish flight attendants may not become an endangered spieces yet, the plans by the Finnish national carrier Finnair to go ahead with outsourcing its cabin crews are likely to reduce the Finnish element in its customer experience.

Finnair announced recently that its talks with the union representing cabin staff had failed to produce required savings.

Finnair pilots meanwhile reached an agreement in principle with the airline to create a less costly salary system.

Talking to Xinhua, Finnair spokesperson Anna-Kaisa Varamaki admitted that the airline takes a calculated risk with its image when flight operations will be "less Finnish".

But that is necessary with a view to the survival of Finnair, she said.

Varamaki dismissed the view that the airline could not cope with Finnish labor laws, but underlined that the current agreements Finnair had signed were only too expensive.

"We pay more than our competitors, including also European traditional carriers," she complained.

While Finnish industries have overall problems in being able to compete against counterparts in countries with lower salary levels, Finnair has faced specific problems with personnel policies dating back to the era of higher fares and little, if any, competition.

Cabin attendants recruited from flight destinations, mainly in Asia, have been flying on Finnair for decades.

Options include establishing a Finnair-owned subsidiary that could produce cabin services more economically.

Service on some 20 routes would be outsourced during the next two years, starting with some routes this year. Out of the present 1,500 person flight crew at least 500 jobs would be lost.

Finnair is seeking annual savings of some 18 million euros (about 25 million U.S. dollars).

Benefiting from the geographical position of Helsinki, Finnair has become one of the leading carriers between many Asian destinations and Europe.

However, the airline is facing increasing competition from low fare short haul carriers in Europe. Major expansion of Asian connections via the Middle East is also an adverse development.

The annual turnover for Finnair in 2013 was 2.4 billion euros and the year ended with a deficit of 4.8 million.

Established in 1923, Finnair is one of the oldest carriers still in operation. The airline is publically listed, but the state of Finland is a majority shareholder. There have been conflicting statements in recent years about the willingness of the government to become a minority shareholder.

Fears have been expressed that without Finnish ownership of Finnair there would be a decline in non-stop connections. (1 euro = 1.36 U.S. dollars)

Editor: Mengjie
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