Flight to nowhere: Finnair incurs phenomenal losses
On Tuesday, June 17, another strike by representatives of the airline industry took place in Finland — one of many in recent times. Finnair, Finland's national airline, has found itself in such a difficult situation that there has already been talk that it needs to be sold. However, it is unclear who would want to buy a company that, due to anti-Russian sanctions, has lost a huge market share and is sitting on loans. The details are in the Izvestia article.
A storm is coming
The strikes began in December last year, when pilots began refusing to work overtime and stopped working as replacements. This meant that in cases where the pilot became ill, the flight had to be canceled. The strikes were organized by two trade unions — the Finnish Pilots Association (Suomen Liikennelentäjäliitto ry, SLL) and the Aviation Union (Ilmailualan Unioni, IAU), which unites all other aviation workers, including specialists from ground air transport services. They demand an improvement in the working conditions of their employees, as well as timely and full-fledged wage indexation corresponding to the current level of inflation.
However, Finnair is not ready to accept the conditions put forward and refers to the difficult financial situation of the company. Despite the fact that negotiations have been underway since the end of January, the IAU and the Palta employers' organization have still not been able to agree on a new collective agreement. Finnair is indeed limited in funds, as it is going through far from the best of times — for reasons that will be outlined below. True, the majority of aviation industry workers still agreed to the proposed salary increase, but the unions are demanding higher allowances. Last winter and spring, the IAU and SLL had already announced strikes several times, which caused Finnair to cancel hundreds of flights. This only deepens the financial "hole" in which the company sits: at the end of April, Finnair announced that in the first quarter of 2025, pilot strikes had "eaten up" its operating profit by €22 million.
At the same time, the airline announced that it would send 36 pilots of long—haul flights on long-term unpaid leave due to a reduction in the volume of activities. The pilots will lose their jobs at the end of September and are expected to remain without work until at least May 2026. Pilots who flew for Finnair's partner on two routes in Australia were injured. "Unfortunately, the pilots' strike has affected our ability to operate our partners' flights with the reliability they have a right to expect, and this has led to job cuts and layoffs," said Jaakko Schildt, Finnair's chief operating Officer.
But the prospect of firing colleagues did not bring the unions to reason, and on May 19 Finnair canceled about a hundred flights again due to a strike at Helsinki airport. The strike lasted four hours and paralyzed the work of various airport services, as well as the delivery of food for Finnair passengers. At that time, flight cancellations affected about 15,000 passengers, who will be offered alternative flight options. The last spring flight cancellations occurred on May 30, and on June 2, the national airline canceled about fifty flights again, affecting about 3,600 passengers. The next strike took place on June 4, and it was not the last either.
On June 15, Finnair announced the cancellation of 143 flights for Tuesday, June 17. The schedule changes affected the plans of approximately 6,500 of the carrier's customers. The cancellation of flights was caused by another strike by IAU members, which took place at Helsinki-Vantaa Airport. Due to the protest, there were problems with baggage handling. Therefore, those passengers who did manage to take off on Tuesday were advised to check in in advance and take only basic necessities with them in their carry-on luggage. At the same time, Finnair warned its passengers about problems with on—board meals on the airline's domestic and European flights from June 17 to June 20. Due to strikes, it is impossible to sell food on board. "We recommend taking snacks with you on board," the airline advised. Passengers who pre-paid for meals were advised to request a refund.
No soft landing is expected
As of June 19, Finnair was forced to announce the cancellation of 128 more flights. In total, by the beginning of June, joint and alternate strikes by SLL and IAU affected a total of about 260 thousand Finnair customers. However, the Finnish Pilots Association was still able to reach an agreement with the employer. But the Aviation Union still believes that it will be able to "shake out" Finnair on more favorable terms for its members, and therefore continues to "nightmare" the airline. It's no secret that because of all these troubles, the national airline found itself in a difficult financial situation.
However, it's not just the strikes that are killing him. Rather, the strikes were the result of the company's inability to meet the demand for higher wages put forward by the trade unions. Finnair is simply running out of money right now. After all, since the Russian airspace was closed to airlines from EU countries, the number of flights through Finland has sharply decreased. It should be recalled that Western airlines currently require special permission from the Federal Air Transport Agency or the Russian Foreign Ministry to fly over Russia. Moscow imposed these restrictions in response to the closure of the airspace of the European Union, the United Kingdom and the United States for Russian aircraft after the start of a special operation in Ukraine.
Sven Kukemelk, an expert on civil aviation, emphasizes that Finnair's business model, which provided it with long-term success, was based on offering fast connections between Europe and Asia. Before the closure of the Russian skies, Finnair was one of the few airlines that flew from the EU to Asia in a day (round trip), but now the route from Helsinki to Tokyo had to be routed through the North Pole. According to Finnair's chief operating officer, Jari Paayanen, three crew members used to be enough for flights over Russia, but now four pilots are involved on most flights to Asia. Fuel consumption has increased significantly, and Finnair has completely abandoned most of the previous Asian routes. Since the company lost the opportunity to fly to Asia via Russia, competitors have taken over this market — in particular, many Asian airlines have benefited from the situation. Currently, more than 55 international airlines fly directly through Russia from Asia to Europe and the United States — Finnair, of course, is not among them.
Another fatal problem was the aging of the fleet, which Finnair does not have enough funds to upgrade. Currently, the company has several long—range aircraft idle, and the rest of the fleet has long been in need of replacement - the aircraft are over 20 years old. Experts note that since the opening of Russian airspace to EU carriers is not expected in the foreseeable future, Finnair will have to significantly reduce its fleet. And the country's largest newspaper, Helsingin Sanomat, warns that Finns will most likely have to say goodbye to the national airline in the coming years. True, journalist Juha-Pekka Raeste admits that there is no direct talk of selling Finnair right now, "because it is tantamount to political suicide," but covering up the problem does nothing to save the airline.
Over the past five years, the company has accumulated loans worth €2 billion, the total amount of which is four times its value. It is the financial problems of the airline, which is unable to raise salaries in a way that satisfies the union, that lead to endless strikes by airport workers. In the last month alone, Finnair lost more than €40 million due to these strikes, which accelerated its fall into the financial abyss. The company's operating profit this year is estimated at €86-172 million, but this is before taxes and loan payments.
A desperate situation
The state currently owns 55.8% of Finnair shares, and the rest is listed on the stock exchange. Due to the fact that most of the company's shares are owned by the government, Finnair is protected from bankruptcy, but the authorities are frankly not happy that the company is losing profitability. According to Kukemelka, the state could decide to buy back Finnair shares, thereby increasing the authorized capital "by several hundred million or a billion euros" — but this option is quite unlikely. "At the moment, I don't think Finland, in a situation where it is increasing its defense budget, will have a billion available to first withdraw Finnair from the stock exchange and then invest in the company," says Sven Kukemelk.
It is unlikely that potential buyers will line up to purchase the main Finnish airline. "The question is who will buy such a specific airline: Finland is geographically at a dead end and cannot rely on transit traffic with Russia's airspace closed," said the editor—in-chief of the aviation portal. Frequentflyers.ru Ilya Shatilin. He noted that Finland itself is "too small in population, economy and uninteresting as a tourist destination," so direct passenger traffic is not large enough to support an entire airline. Overall, there are no good exits for Finnair. "There are still domestic flights that directly depend on government subsidies. At the same time, the EU is not allowed to subsidize air transportation on routes that take less than three hours by train, and Finland is too small and there are few such routes within it," Shatilin notes.
In addition, the situation with Finnair is by no means unique — now Finland is teetering on the brink of bankruptcy and hundreds of other enterprises are closing. In May 2025, 366 bankruptcy procedures began in the country, 39 more than in May last year. 1,231 workplaces were hit. According to the country's statistical office, the service sectors, including hotels and restaurants, have been particularly hard hit — they are the ones that most often close amid high inflation, rising costs and falling consumer activity. Over the past 12 months, the number of bankruptcies has increased by 8%. Experts point out that such dynamics may be just the beginning of a wave, especially if stagnation in construction and logistics continues.
Against the background of the crisis abyss into which the Finnish economy is sinking deeper, the problems of one company, even a very well-known one, no longer concern the population so much. In addition, the possible liquidation of Finnair will not be something exceptional. On the contrary, this is quite a common situation for the Baltic region countries. Last year, the history of the Estonian national airline Nordica ended in bankruptcy. The national airline airBaltic is on the verge of closure in Latvia. Both Nordica and airBaltic were victims of two circumstances: first, they were led to the edge of the abyss by poor management, and secondly, the exclusion from Russian airspace and from Russian passengers had a negative impact. In this regard, the situation with Finnair is by no means unique.
Natalia Eremina, Doctor of Political Sciences, Professor at St. Petersburg State University, in an interview with Izvestia, noted that at one time, for airlines from EU countries, communication with Asian countries was one of the most important areas of activity, they earned a lot of money from it. "Now that they have to fly around Russia, these destinations have become very expensive both for airlines, which have to spend much more on fuel and maintenance, and, accordingly, for passengers. Many airlines have been affected, but Finnair has been particularly affected. The previous plans of Finnair, which had previously intended to increase the number of flights between the EU and Asian countries, went to waste. And then there are the strikes, which disrupt flights or even simply refuse to feed people on board, which completely destroy Finnair's reputation in the eyes of customers. However, the troubles of this airline are only a special case of the problems that have befallen the Finnish economy," sums up Eremina.
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