Finnair To Shrink & Cost Cut Its Way To Profitability

Not sure if they are upgrading their award system due to cooperation with Quatar, but Finnair's J award availability to/from Asia (Singapore/Tokyo/Bangkok and HK from next year) recently completely disappeared whereas a couple of weeks ago one could always find some availability. If this continues will be very disappointing for those who bought points from them during their promotion.

I would not be surprised. I mean they have just eliminated the Dubai Sweetspot, which would have worked with Doha as well.

It's not only people who where buying points but also those who took advantage of the 3x points promo in June. I have two returns booked earning me 2x 90k points and Finnair Platinum (= OneWorld Emerald).

Honestly, this was so generous, that a devaluation got likelier.

Considering the geopolitics, it appears to be a realistic practical strategy. Perhaps a bellwether. Best to plan for the worst & hope for the best?

The State of Finland still owns a majority stake in Finnair. The State, and the company, together need to decide what they want Finnair to be. It's a high cost airline, headquartered in a high cost, out-of-the-way country. Their ability to shrink themselves to profitability is limited. The way I see it, their primary job is to "fly the flag" in the same manner as Qatar, Royal Jordanian, etc. Unless they plan on operating multiple daily flights from the Nordic countries to Doha (and where is the market for that?) their fleet utilization rate will tank and that too will increase costs. Their cost cutting has already led to lower service standards which are becoming increasingly noticeable. I wish them luck but I don't see their efforts being successful.

No more gummies in the galley, I guess!
Finnair's service already feels streamlined - I wonder what else they can cut in terms of their soft product without losing their cultural flair. There's something about the Marimekko amenity kits that, while not as nice as some other airlines' kits, feel very on-brand for AY; the blueberry juice, menus, and iittala glassware (though Italian), also bring a culinary and visual branding to the airline that would be sad to lose. Here's hoping the new J seats save them a lot on fuel...

Agreed on your first thoughts.
That said, QS, I would argue, hardly exists to "fly the flag" - like Emirates and Eithad, their bread and butter is providing profitable long haul-to-medium and long haul connecting services, not serving as an ambassador to a tiny country whose domestic demand is small. Sure, the soft product has touches of Qatari flavor, but I would hardly consider QR's operational modus operandi to "fly the flag" - it's to make money, first and foremost.

I couldn’t help laughing at their ”excellent product” and ”strong brand”. No matter how much I like Finnair, there’s no denying that their soft product is far from excellent – it’s not even mediocre anymore, after all the recent cuts.

And they’ve done everything possible in the past nine months or so to destroy their brand – bad contract staff being one of the main brand anti-ambassadors. Everchanging schedules, lots of cancellations and not honoring EC261 reroute obligations don’t exactly contribute to a strong brand in my books.

This explains why Finnair cancelled my outbound and inbound flights between Chicago and Helsinki. They have not yet cancelled my long haul flight to And from Singapore. So I am guessing they prefer their A350s. Now I have to find a different airline for my long planned trip. Doubt this will help their bottom line.

Ben writes: "While Helsinki isn’t a huge market, it’s a lovely airport to connect at, and if flying oneworld I’d much rather connect in Helsinki than London"

You do realize how much further out of the way HEL is a connecting point for most of Europe from the US as compared to LHR, right?

Some examples:
* ORD/VIE: going via HEL adds 600 miles compared to LHR
* DFW/CDG: going via HEL adds almost 1500 miles compared to LHR
* ORD/MXP: going via HEL adds more than 1100 miles compared to LHR
* ORD/PRG: going via HEL adds around 600 miles compared to LHR
* DFW/DUS: going via HEL adds 1100 miles compared to LHR
* DFW/LIS: going via HEL adds around 1600 miles compared to LHR
*etc...

How much extra travel time is worth a slightly better connection experience?

Ben probably wasn't referring to connections with final destination in Europe. For going eastbound such as Asia not much difference vs LHR

And for Europe I'll still take the extra distance if it makes huge difference in charged taxes/fees on award redemption versus the one world thief BA (and the wasted time with security check, etc probably offsets the extra flying time)

Iittala is not Italian. It is a Finnish brand and company, with products designed and made in Finland.

By fly the flag I mean their first responsibility is to represent and connect Finland with the rest of the world. The State of Qatar would be nothing if it weren’t for Qatar Airways. Qatar Airways put the country on the map, and frankly that is the primary role of Finnair too. I’m not comparing the service levels of the two companies, just their reason for existing in the first place. Finnair still is 45% owned by non government shareholders so they are between a rock and a hard place. They need to satisfy all of their shareholders and that is not going to be an easy task.

I wonder if DL will pick up some more second-hand A350s and have a third sub-type.

As a Oneworld flyer based in the Northeast being able to bypass LHR would be huge, but timing for them is unfortunate as I don't see North Americans going to Nordic countries during winter and because of Russia it's less than ideal for connections to Asia. That being said come Spring I think a flight to Boston could do well at least seasonally.

I have flown them on several Central Europe to USA trips this year and really like the airline. I realize that they are going through a tough time but love the ease of transiting Helsinki and the Platinum Wing of the FinnAir lounge is a great place to spend a couple hours between flights. Their onboard soft product is already below BA, so I hope they don't cut that. If they try to turn into a LCC then corporate flyers will just end up switching to larger full service carriers

The good times are over without Russian airspace. Finnair should ramp up U.S. flights. Shedding aircraft, personnel reduces them to an Air Baltic with long haul routes. With only 5 million population, will the socialist Finnish government continue, like the old Alitalia and current SAS, to inject endless cash to keep it aloft? Might a mega merger of Braathens, Air Baltic, Wideroe, Atlantic Airways, Norwegian, Norse Atlantic, SAS, Finnair and Icelandair be the answer for northern Europe?

Correct. I snagged about 8 of the Iittala votives (in 8 different colors) when I was there this past summer and as noted on the boxes, "Made In Finland".

Plenty of folks connect from America to Europe, going backwards via Istanbul.

I don't know if Russia actually closed its airspace. Rather, airlines from Europe, the US, Canada, etc. don't want to pay overflight fees to the Russian government.

The EU banned Russian airlines from EU airspace. Russia replied by doing the same to EU airlines flying over Russia.

Having travelled many times UK to Singapore on various carriers - Finnair is my favourite. Excellent business class product, great airport in Helsinki. It will be a shame if they let this route go. Sadly they are not promoted enough as an option for Australians flying to Europe.

With population of 630k in Helsinki and 5.5m in the entire country, there is no customer base to support a sizable airline. It is also not a top tourist destination and the wages are generally high. I simply do not see how Finnair would survive. Covid-19 and the closure of Russian airspace (and also connecting air traffic to/from Russia) caused a closure of many Finnair routes and those will not be coming back. They simply have airplanes and the main airport in a wrong place.

“Significantly strengthening unit revenues through enhanced digital offering, competitive products and customer choice”

Why does every airline seem to use this phrase? It usually precedes nickel and diming every product and service subsequently providing a bland product where you longer can tell what airline you are flying.

Except the profitability of transatlantic service tanks outside the summer months. If you are traveling from JFK/BOS/IAD/PHL you are going to have to take a pretty big detour through Helsinki to eventually to LHR, CDG, Frankfurt, or Rome. I think customers would expect a very discounted ticket for that inconvenience.

ask Pan Am, Eastern, Frontier, USAir, Braniff, TWA how shrinking to profitability went???

I have to agree. Even in good times (Sep 2021), I was surprised that my paid-business fare on HEL-LAX required at 150 euro seat fee to pick seats. They brought the worst of economy up a cabin, which really strikes me as a LCC move.

I should mention: I didn't pay the fare and decided I wouldn't likely be taking Finnair again for paid J. They didn't make money *and* made a bad impression. I have to question their strategy, given that...