Q&A with Finnair’s Chief Commercial Officer, Ole Orvér.

posted on 20th November 2019
Q&A with Finnair’s Chief Commercial Officer, Ole Orvér.

How has your geographical position influenced route developments over the past few years?

Helsinki occupies a unique position on the flight path between Europe, the Far East and Asia. On average, flight times via Helsinki can be more than two hours shorter than flights from other European hubs with our competitor carriers. In some cases, flights are four hours quicker compared to flights from hub airports in the Middle East. This has powered our strategy to focus on the Far East and Asia.

Helsinki Airport also supports the growth of traffic between Asia and Europe thanks to its three runways, quick connection times from as little as 40 minutes, and relatively uncongested airspace. These conditions make Helsinki Airport ideal for customers connecting between flights. This advantage features prominently in our marketing and PR approach.

Have recent route developments been successful?

Our route network strategy, focusing on Asia and, to a lesser extent North America, has paid off. Finnair now operates to 19 destinations in Asia, eight destinations in the Americas and more than 100 across Europe. Offering more routes to Japan than any other European carrier, Finnair is getting set to launch its fifth Japanese destination, to Sapporo, in December 2019. Finnair’s short-haul fleet has continued to grow to meet the demand for transfer traffic onto our expanding long-haul route network.

How have strategic partnerships helped Finnair?

Our membership of the Oneworld alliance has enhanced our ability to offer a wide choice of routes and pricing options. It has helped to increase our global network to more than 1,000 destinations in more than 160 countries. Finnair’s membership of Oneworld, along with our strategic joint businesses, has also made a significant contribution to revenue. Finnair is a member of the Atlantic Joint Business in partnership with American Airlines, British Airways and Iberia on flights across the Atlantic and the Siberian Joint Business with Iberia, British Airways and Japan Airlines on flights to Asia.

Has Finnair performed well this year?

Finnair has continued to expand its operations despite strong headwinds in what has been a volatile year for many in the aviation sector. Our Q3 results were broadly in line with our expectations. Growth continued and our market share increased, with strong performance in European traffic, new North American routes and a record summer, carrying four million customers, compared to 3.7 million by Q3 2018. Revenue increased by 7.9 per cent to 870.3 million Euros and capacity increased by 9.5 per cent. We have also seen an increase in market share in both Asian and European traffic. Ancillary sales grew by 8.8 per cent, slightly faster than passenger revenue which rose by 8.7 per cent. Profitability has been affected by higher fuel costs, adverse exchange rates, a 10.9 per cent rise in operating costs and a 3.9 per cent weakening in the global cargo market. As expected, demand on some of our Asian routes has fallen, most notably Hong Kong. While concerns over Chinese-US trade relations have also impacted demand we are steering Finnair forward with judicious growth and are looking forward to launching new routes to Japan in December and Busan in South Korea next March.

Is Finnair pushing a greener aviation agenda? 

We want Finnair to contribute to a more sustainable aviation industry and future. The launch of our Push for Change carbon offsetting and biofuel initiative is our latest move in this direction. Finnair customers can now offset the CO2 emissions of their flights by supporting CO2 emission reduction projects or help to buy biofuel for a future flight. We flew our first two biofuel flights supported by the Push for Change initiative this summer. As an airline championing sustainable and responsible aviation, we remain committed to the common goals of the aviation sector to halve CO2 emissions by 2050 and achieve carbon neutral growth by 2020.

Are you investing in greener aircraft?

Finnair has made a significant investment in new more eco-efficient aircraft. Our Airbus A350 fleet is key to Finnair’s strategy and ambitious expansion plans. We were the first airline in Europe to take delivery of the A350, which offers our customers enhanced comfort and capacity in cabins featuring our Nordic design elements. The A350 also contributes to our drive for greater efficiency and sustainability. The A350 is about 25 per cent more fuel efficient than older similar generation aircraft. Customer feedback on the fourteen A350s currently in the fleet – with another five to be delivered by 2023 – has been extremely positive and helps drive passenger numbers. Focusing on fuel efficiency, in tandem with optimising flight speeds and altitudes and reducing aircraft weight, is also helping us combat CO2 emissions. We are now saving 450 tons of fuel a year by removing 150kg of weight from the A350 following a recent cabin reconfiguration. Smaller actions, such as using recycled plastics in our amenity kits is similarly helping reduce plastic waste by almost 4,500 kg per year. Our sustainability strategy is making a significant contribution to our bottom line.

How is Finnair’s success linked to wider developments in the local economy and growth at Helsinki Airport?

Helsinki-Vantaa Airport’s continued growth is essential for Finnair’s ambitious expansion plans. The airport is preparing to serve up to 30 million passengers in the future. With three runways, Helsinki Airport reduces the need for aircraft to be held in holding patterns, thereby reducing fuel burn and emissions. Enhancing the airport, with investments in new digital services, ensures Finnair customers can transfer easily and quickly between aircraft and continue choosing the airline.

What are Finnair’s future ambitions?

Our route network includes more than 100 European destinations, 19 in Asia and eight in America. From November onwards, we will increase frequencies to Beijing, launching flights to the new Beijing Daxing International Airport. Alongside existing flights to Tokyo, Osaka, Nagoya and Fukuoka, we are launching flights to our fifth destination in Japan, Sapporo. And from March 2020, flights to Tokyo will be boosted with the launch of services to the city’s Haneda Airport, in addition to Narita. We also recently announced that we are opening a second route to South Korea next summer – making Finnair the only European airline flying non-stop to Busan, the second largest city in South Korea.