AirBaltic Plans Up to 700 Job Cuts in Restructuring

Latvian airline AirBaltic is preparing to cut between 500 and 700 jobs across its bases in Riga, Vilnius and Tallinn as the carrier carries out a major restructuring aimed at reducing debt and adjusting its operations.

The planned workforce reductions come after airBaltic filed for Chapter 11 bankruptcy protection in New York in September. The airline is seeking to complete a broad restructuring that includes reducing capacity and its fleet as it works to address its mounting debt.

AirBaltic Could Cut Up to 700 Positions

AirBaltic said on Monday that it was in discussions with labour unions over potential changes to working arrangements for pilots and cabin crew. The broader workforce changes could affect around 500 to 700 positions across the airline’s operations in the Baltic region.

The company operates bases in Riga, Latvia, as well as Vilnius in Lithuania and Tallinn in Estonia. The final number of jobs affected has not yet been determined and could change as the restructuring process develops.

AirBaltic said new organisational structures for other parts of the company are expected to be defined by the middle of October. That process will provide greater clarity on how the airline’s workforce will be organised following the restructuring.

Airline Filed for Chapter 11 in September

The planned job reductions are part of a wider restructuring following airBaltic’s Chapter 11 bankruptcy filing in New York in September.

Chapter 11 protection allows companies to reorganise their finances while continuing operations. For airBaltic, the restructuring is focused on reducing its debt burden and adjusting the scale of its business through changes to capacity and its fleet.

The airline’s restructuring comes at a time when carriers across the Aviation industry continue to balance aircraft costs, staffing expenses, fuel prices and demand for air travel.

Debt Reduction Is at the Centre of the Restructuring

AirBaltic’s restructuring is primarily aimed at addressing its growing debt. Reducing the size of the workforce is one element of a broader effort to align the airline’s costs with its planned operational capacity.

The company is also planning fleet and capacity reductions. These measures are designed to reduce expenses and create a business structure that can operate with a lower financial burden.

However, workforce changes can take time to implement because airlines must coordinate staffing levels with flight schedules, aircraft utilisation and labour agreements.

Talks With Unions Underway

AirBaltic is discussing possible workforce arrangements with labour unions as part of the restructuring process. The talks include potential reduced-workload arrangements for pilots and cabin crew.

These discussions could influence how much of the workforce reduction is achieved through direct Job Cuts and how much comes through changes in working arrangements.

AirBaltic CEO Erno Hilden had previously told Reuters in September that the airline was in discussions with labour unions about an adjustment to its workforce.

The latest announcement indicates that those discussions are now an important part of the airline’s restructuring process.

AirBaltic Secures Access to €140 Million

AirBaltic received approval last month to access €140 million from a broader €350 million financing package. The additional financing is intended to support the airline as it works through the restructuring process.

Access to financing is particularly important for an airline operating under Chapter 11 protection because the company must continue funding day-to-day operations while implementing changes designed to improve its financial position.

The financing package provides airBaltic with additional resources as it works through its restructuring and seeks to establish a more sustainable operating model.

What the Job Cuts Mean for AirBaltic

A workforce reduction of 500 to 700 positions would represent a significant organisational change for airBaltic. The impact will depend on the final number of positions eliminated, the distribution of reductions among locations and departments, and the extent to which reduced-workload arrangements are used.

The airline has not yet announced a final breakdown of the potential job cuts by base or employee category.

The company is expected to define new organisational structures for the rest of its workforce by mid-October, which should provide more information about the scale and structure of the changes.

Riga, Vilnius and Tallinn Bases Affected

The potential workforce reductions could affect employees across airBaltic’s three main bases in Riga, Vilnius and Tallinn.

Riga is the airline’s home base and its principal operating centre. The presence of bases in Vilnius and Tallinn reflects airBaltic’s role in connecting the Baltic region with destinations across Europe.

Any changes to staffing levels will therefore be closely watched in all three markets, particularly if reductions are accompanied by changes to flight capacity or aircraft deployment.

Capacity and Fleet Reductions Planned

AirBaltic’s restructuring plan extends beyond employment. The airline is also seeking to reduce capacity and its fleet as part of its efforts to control costs and reduce debt.

For an airline, capacity decisions can involve changes to flight frequencies, routes and aircraft utilisation. Fleet adjustments can also affect maintenance, crew requirements and other operating expenses.

Aligning the size of the fleet and workforce with expected demand is therefore a key part of the restructuring strategy.

Final Number of Layoffs Could Change

AirBaltic stressed that the final number of layoffs could change during the restructuring process. The current estimate of 500 to 700 positions should therefore be viewed as a potential range rather than a final figure.

The outcome will depend partly on discussions with labour unions and the organisational structures eventually adopted by the airline.

The company is expected to provide greater clarity as those discussions progress and new organisational arrangements are finalised.

AirBaltic’s Next Steps

The immediate focus for airBaltic will be on progressing its Chapter 11 restructuring while maintaining normal airline operations.

The company needs to balance cost reductions with the need to retain enough employees and operational capacity to serve its customers and maintain its network.

In the coming weeks, investors, employees and other stakeholders will be watching for details about the final workforce plan, fleet changes, capacity adjustments and the airline’s financial restructuring.

What to Watch in AirBaltic’s Restructuring

• The final number of positions affected by the workforce restructuring.
• Outcomes of negotiations with labour unions representing pilots and cabin crew.
• New organisational structures expected to be defined by mid-October.
• Changes to airBaltic’s fleet and flight capacity.
• Use of the €140 million financing approved from the broader €350 million package.
• Progress of the Chapter 11 restructuring and debt-reduction process.

FAQs

How many jobs does airBaltic plan to cut?

AirBaltic is preparing workforce reductions that could affect around 500 to 700 positions across its bases in Riga, Vilnius and Tallinn. The final number could change during the restructuring process.

Why is airBaltic cutting jobs?

The planned workforce reductions are part of a broader restructuring aimed at reducing the airline’s mounting debt and aligning its workforce with planned reductions in capacity and fleet size.

Where will the airBaltic job cuts take place?

The potential reductions could affect positions across airBaltic’s bases in Riga, Latvia, Vilnius, Lithuania, and Tallinn, Estonia.

Has airBaltic filed for bankruptcy?

Yes. AirBaltic filed for Chapter 11 bankruptcy protection in New York in September as it began a major financial restructuring.

Is airBaltic negotiating with labour unions?

Yes. The airline said it is in talks with unions over potential reduced-workload arrangements for pilots and cabin crew as part of its workforce restructuring.

How much financing has airBaltic received?

AirBaltic gained approval to access €140 million from a broader €350 million financing package as it works through its restructuring.

When will airBaltic define its new organisational structure?

The airline said new organisational structures for the rest of the company are expected to be defined by the middle of October.

Will the final number of layoffs definitely be 500 to 700?

No. AirBaltic said the final number of layoffs could change during the restructuring process as discussions with unions and organisational planning continue.