SK931
25-08-2006, 15:01
Finnair’s Swedish subsidiary FlyNordic improves its profitability
Low-fare airline FlyNordic, Finnair’s Swedish subsidiary, has been cutting unprofitable routes during the summer and changing its focus to charter flights.
FlyNordic’s passenger numbers rose to a new record in July. The airline flew 116 390 passengers in scheduled and charter traffic, which is 20 per cent more than the previous year.
“We have also reached record levels in our passenger load factor, 80.6 per cent. Our profitability has improved during the spring and summer. In July our result was in the black,” explains FlyNordic Managing Director Maunu von Lüders.
Last year FlyNordic made a loss of slightly 17 million euros.
“The expected loss was deepened by tough competition in the Swedish market and the huge increase in the price of fuel,” says Finnair Deputy CEO Henrik Arle. “This year we have begun hedging our fuel purchases in the same manner as Finnair. The parent company Finnair has retired its Boeing MD-80 fleet which allows FlyNordic to adjust or increase its capacity flexibly. This year the result will improve from the previous year but it will still be in the red.”
Finnair has been in the Swedish low-fare flight market since 2003 after acquiring FlyNordic.
“Our market share has increased strongly in these three years. Naturally, the airline’s profitability has not been satisfactory, but we have been able to steer the market situation as a whole to our benefit. We want to be involved in developing new operating models in the Nordic airline industry,” Arle states.
FlyNordic carried 1.2 million passengers last year. In co-operation with its partners Norwegian Air Shuttle and Sterling, it has operated to 18 scheduled destinations out of Stockholm this summer. In the winter season, the number of routes will decrease.
“There has been a great deal of oversupply on the Swedish air travel market.. More important now than growth in passenger numbers are improvement of our load factor and the profitability of our operations. For this reason we are carefully choosing the routes we will operate and will reallocate remaining capacity to leisure traffic,” explains von Lüders.
Low-fare airline FlyNordic, Finnair’s Swedish subsidiary, has been cutting unprofitable routes during the summer and changing its focus to charter flights.
FlyNordic’s passenger numbers rose to a new record in July. The airline flew 116 390 passengers in scheduled and charter traffic, which is 20 per cent more than the previous year.
“We have also reached record levels in our passenger load factor, 80.6 per cent. Our profitability has improved during the spring and summer. In July our result was in the black,” explains FlyNordic Managing Director Maunu von Lüders.
Last year FlyNordic made a loss of slightly 17 million euros.
“The expected loss was deepened by tough competition in the Swedish market and the huge increase in the price of fuel,” says Finnair Deputy CEO Henrik Arle. “This year we have begun hedging our fuel purchases in the same manner as Finnair. The parent company Finnair has retired its Boeing MD-80 fleet which allows FlyNordic to adjust or increase its capacity flexibly. This year the result will improve from the previous year but it will still be in the red.”
Finnair has been in the Swedish low-fare flight market since 2003 after acquiring FlyNordic.
“Our market share has increased strongly in these three years. Naturally, the airline’s profitability has not been satisfactory, but we have been able to steer the market situation as a whole to our benefit. We want to be involved in developing new operating models in the Nordic airline industry,” Arle states.
FlyNordic carried 1.2 million passengers last year. In co-operation with its partners Norwegian Air Shuttle and Sterling, it has operated to 18 scheduled destinations out of Stockholm this summer. In the winter season, the number of routes will decrease.
“There has been a great deal of oversupply on the Swedish air travel market.. More important now than growth in passenger numbers are improvement of our load factor and the profitability of our operations. For this reason we are carefully choosing the routes we will operate and will reallocate remaining capacity to leisure traffic,” explains von Lüders.