Air Baltic is quickly getting back in the air | Business | Economy and finance news from a German perspective | DW | 17.07.2020

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Air Baltic is quickly getting back in the air

Tiny Air Baltic is leading the charge in the European airline industry demonstrating that civilized flying is still possible in times of the coronavirus pandemic. Soon they plan to fly at full throttle.

"Many people are currently still afraid to fly, but that will change soon," says Martin Gauss. Since 2011 the German, who used to be a pilot and then manager at Deutsche BA, has worked in Riga at Air Baltic, a major airline in the Baltics seen by many in the industry as a role model.

As the coronavirus spread, the company found a radical cure. "As the first carrier in Europe we completely stopped flying on March 17, we immediately slashed the company's size by 40%, both in staff and fleet," recalls Gauss.

Almost 700 employees had to go, all getting a guarantee of reinstatement once business picks up. During lockdown, a team of 11 top managers went into seclusion together inside the otherwise emptied headquarters next to the equally eerie Riga airport.

For two months they spent almost every day there together, including taking COVID-19 tests every two weeks and only going home to sleep. "During this time we had to come up with a new strategy and a product that would be acceptable to customers post-crisis," explains Gauss.

Back in the air

It seemed like things would never be the same, but since May 18 the airline has been taking off again, but is still serving only a part of their former route network. Initially they operated just four of their 38 aircraft, but today they are flying about half the fleet. Some things have changed, but Gauss says "the biggest change in our product is that we actually deliver it to customers almost the same way that it was before."

An Air Baltic flight attendant

An Air Baltic flight attendant wearing a protective mask

This way, flying remains a civilized experience. The cabin crew do not wear full-body protection suits or face shields as mandated by Qatar Airways, which even calls on passengers to wear face shields and even hands them out to those not carrying one. Flight attendants at Air Baltic wear masks and gloves. Passengers wear masks while on board.

"We are the first European airline to hand every customer on every flight an envelope containing a fresh mask and two disinfection wipes," Gauss points out.

During the height of the crisis, Air Baltic itself repeatedly sent jets all the way to China to pick up millions of masks. "How much sense an obligation makes to wear masks is open to discussion, however," he says. "At the moment, people seem to be happier wearing a mask. But there is no medical reason why one has to be worn on an aircraft, but not in a restaurant."

More coronavirus protection for airplanes

A young fleet

Since the crisis, Air Baltic has relied solely on its newest Airbus A220 jets — the planes it has focused its entire strategy on.

This means that the company is now operating the world's youngest fleet with an average age below two years, thus being particularly efficient. During every stop in Riga the aircraft get a deep cleaning and passengers can add to that around their own seats by utilizing the disinfection wipes handed out.

Now passengers can even rebook the cheapest tickets for a fee, which wasn't the case before. "Due to the uncertainty this has been a necessity," reports Martin Gauss. The middle seats currently remain mostly empty. Fortunately the A220 only has middle seats on the right side of the aisle. "But they remain free only if less than 89 passengers are booked," stresses the CEO, "there is no medical need to do it."

In Riga, Chief Operations Officer Pauls Calaitis, himself a captain, gives a tour through the airline's Operations Control Centre, where one can see Air Baltic's entire flight activity on huge screens in real time. Usually manned 24/7, during the grounding, this centerpiece of the airline was completely shut down. "That was traumatic to see," recalls Calaitis. So far only a fraction of the frantic activity that usually dominates this place during peak travel season can be seen.

Every passenger on Air Baltic now gets an envelope with a fresh mask and two disinfection wipes

Every passenger on Air Baltic now gets an envelope with a fresh mask and two disinfection wipes

Despite this slowdown, Calaitis is content: "We haven't cancelled a single flight in the first seven weeks of restarted operations, that's a strong signal to our guests. Whatever they book, it's flying." He dons a wide grin pointing to the 100% punctuality rate of his flights. "These are world-class figures that we normally never see in summer, but the reason is simple — there is just so much less traffic in the skies." Every Wednesday, business gets serious when Air Baltic decides which destination can be added.

Taking off in uncertain times

So far, Russia, Ukraine and Sweden have remained closed — all of them top markets before the coronavirus lockdowns. Still, booking numbers are back to about half the amount at this time last year. And this despite the fact that not even half the usual capacity is currently offered. "Given what we can offer in capacity, bookings are very strong," enthuses Gauss.

The June load factor was 39%, usually a catastrophically low number, but now it is seen as a glimmer of hope. During the first week of July, Air Baltic operated 369 scheduled flights, versus 1,346 in the same week a year earlier.

In September, all 22 Air Baltic A220s are scheduled to take to the skies again. The number is due to increase to 32 in 2021.

"We will survive, even if a second wave of the pandemic hits," assures Martin Gauss, "but naturally we did have doubts in the beginning if we would get through this."

Currently, the airline still manages to live off its cash. In early July, the EU gave the green light to an equity increase of €250 million (€285 million) by the majority shareholder, the Latvian government. The money is due to be repaid after its IPO now planned for late 2022 or early 2023.

"I am happy," says Gauss. These are words not many airline bosses would use these days.

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