China Market Remains ‘Vital’ For Finnair
CHIANG MAI, Thailand—Finnair is seeking to re-establish itself in the Chinese market as it gradually rebuilds an Asian network that has been severely constrained by travel restrictions and the closure of Russian air space.
The oneworld alliance member operated passenger flights from Helsinki (HEL) to six destinations in mainland China during the northern summer 2019 season, offering 28 flights per week and some 17,000 two-way seats. However, the airline’s network has been reduced to just one route at the present time, with two round trips per week to Shanghai Pudong (PVG).
“The Chinese part of our network has been very complicated due to the regulations they’ve had in place, and we’ve had to long stop aircraft because of crew constraints,” said Aaron McGarvey, Finnair's head of network strategy and development, speaking Feb. 15 at Routes Asia 2023.
“It was very, very difficult during COVID and following that with the airspace closure. But now we’re more freely able to add capacity to China we will look at increasing that as we can. It remains a vital market and we hope to get it going again by mid to late this year.”
Prior to the pandemic, Finnair’s business model focused on connecting Europe and Asia using the shorter northern route over Russia. The carrier temporarily altered the strategy in response to COVID travel restrictions—focusing on North America—but Russia’s invasion of Ukraine and the subsequent closure of Russian airspace then rendered many Asian routes financially unviable.
McGarvey said that the closure has added 3-4 hr. on to each leg, which “completely violates” Finnair’s hub structure in Helsinki.
Although McGarvey asserted that China will continue to be part of the carrier’s network, he said that Chinese carriers will have a competitive advantage over their European counterparts because they continue to overfly Russia.
“Largely speaking, a lot of the European airlines won't be able to offer prices that Chinese carriers can purely because of cost of operation. As a reference point, it is anything from 30% to 50% more per rotation,” he said.