Finnair prepares for fleet renewal – new €60m savings program launched

Finnair is launching a new cost savings program that targets sustainable annual cost savings of €60m by the end of 2014. With this program, Finnair aims to ensure its competitiveness and ability to make future investments. Finnair estimates it will reach a profitable operational result in 2012 after several loss-making years, and its existing structural change and cost reduction program, targeting €140m savings, has progressed well. However, Finnair faces significant fleet investments in the coming years, which will require a sustainable improvement in the company’s profitability. The new €60m cost savings program complements Finnair’s existing structural change and cost reduction program launched in August 2011. The new program focuses especially on streamlining operations and processes in different business and support functions, so that they meet the future needs of Finnair as it undergoes a major structural transformation. Renewing Finnair’s fleet is vital for the implementation of the airline’s Asian growth strategy. Investments related to fleet renewal are significant in the coming years: Four Boeing 757 aircraft, used in Finnair’s leisure traffic, will be replaced with five Airbus 321 ER aircraft in 2013 and 2014, and the first of 11 Airbus 350 XWB aircraft will join Finnair’s fleet in 2015. The value of these investments totals €1.2bn.