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Finnair Projects Substantial Loss After Cutting 90% of Capacity

Finnair Projects Substantial Loss After Cutting 90% of Capacity

(Bloomberg) --

Finland’s national carrier Finnair Oyj will slash 90% of its flight capacity in response to a decline in demand caused by the global new coronavirus pandemic, resulting in a substantial operating loss this year.

The airline also withdrew its dividend proposal and plans to cut costs, according to a statement on Monday. In addition, it is implementing a funding plan that includes credit lines and the sale and leaseback of aircraft.

“It’s now clear that the coronavirus is by far the biggest crisis in the history of aviation,” Chief Executive Officer Topi Manner said. In a separate statement, Manner said the capacity cuts are “unavoidable” as “we cannot fly customers in a situation where we may not be able to fly them back home.”

Finnair is canceling as many as 2,000 flights through March and will temporarily operate only about 20 routes starting from April 1, ensuring certain critical air and cargo supply connections for Finland until the situation improves. The routes include key European cities and Tokyo, with all North American and other Asian traffic halted.

To contact the reporter on this story: Kati Pohjanpalo in Helsinki at kpohjanpalo@bloomberg.net

To contact the editors responsible for this story: Tasneem Hanfi Brögger at tbrogger@bloomberg.net, Stephen Treloar

©2020 Bloomberg L.P.