Latvian national carrier airBaltic faces critical structural decisions to survive in the changing European aviation market, though flights remain stable in the near term, according to Ēro Pergmē, a board member of Tallinn Airport operator Tallinna Lennujaam. Speaking in an interview with Estonian public television, Pergmē outlined the carrier’s two potential futures amid a broader industry landscape shaped by high jet fuel prices and dominant major airlines.
Two Paths for the Baltic Carrier
The airline must successfully complete its ongoing restructuring to operate a smaller fleet and achieve profitability, or risk closure if its business model ultimately fails against larger European competitors, according to Pergmē. Tallinna Lennujaam’s commercial board member noted that reducing the active fleet represents a logical step for the carrier. Operating a fleet exceeding 35 aircraft lacks viable deployment options within the Baltic region, though questions remain regarding the timing of these adjustments, Pergmē stated.
Fleet Reduction and Schedule Stability in Tallinn
As the largest carrier operating out of Tallinn Airport with a 29% market share, airBaltic continues to maintain its scheduled flights and ticket sales, according to Pergmē. However, customer booking windows have shortened significantly, with travelers now purchasing tickets only one to two months in advance. Pergmē stated that the airline must provide additional explanations regarding January schedules to bolster market confidence, though he confirmed he would personally purchase tickets for late September travel, noting that 12 routes from Tallinn currently have tickets on sale. Surviving the winter season will require both additional financial backing and positive market signals, likely resulting in slightly reduced flight frequencies from Tallinn, according to the airport official.
Did you know? airBaltic holds a 29% market share at Tallinn Airport, making it the single largest carrier operating out of the Estonian capital.
Market Impacts and the Jet Fuel Cost Burden
While reduced flight frequencies by airBaltic could temporarily impact the regional market, strong overall travel demand will likely enable the introduction of new routes and carriers, according to Pergmē. Tallinna Lennujaam maintains a diverse portfolio of regular carriers, with 50% of its passengers connecting through major European hubs such as Frankfurt, Helsinki, Copenhagen, Warsaw, and Riga, ensuring Estonia will retain robust air connectivity. Meanwhile, soaring jet fuel prices—driven by regional tensions near the Strait of Hormuz and contrasting with significantly lower costs during the previous year—are forcing airlines across the industry to trim longer and less profitable winter routes.
Financial Restructuring and Shareholder Structure
To improve its liquidity, the airBaltic council has approved a business plan to secure 225 million euros in temporary financing backed by existing 2029 notes, according to company disclosures. The long-term strategy involves recapitalizing the enterprise with up to 225 million euros in new loans and 100 million euros in new equity, while converting a portion of existing 2029 notes into equity and replacing the remainder with a reduced debt package of up to 125 million euros. Under this business plan, the airline aims to operate 36 Airbus A220-300 aircraft by the end of 2026, down from 54 aircraft currently, before gradually expanding the fleet to approximately 40 aircraft by 2031.
The airline transported 5,2 million passengers in 2025, marking an increase year-over-year. Following these market conditions and financial results, airBaltic has suspended potential initial public offering plans for 2026, as detailed in the company’s annual report.
Frequently Asked Questions
Are airBaltic flights operating normally?
Yes, airBaltic flights continue to operate according to schedule and tickets remain available for purchase, though booking windows have shortened to one or two months in advance, according to Tallinna Lennujaam board member Ēro Pergmē.
What is airBaltic’s current fleet strategy?
The airline plans to operate 36 Airbus A220-300 aircraft by the end of 2026 as part of its restructuring plan, down from 54 current aircraft, with the fleet expected to expand to approximately 40 aircraft by 2031.
Who owns shares in airBaltic?
The Latvian state owns shares of airBaltic, German carrier Lufthansa holds 10%, Lars Thuesen’s Aircraft Leasing 1 holds a stake, and other investors hold stakes.
Why are airlines reducing winter routes?
High jet fuel prices, exacerbated by market conditions near the Strait of Hormuz compared to the previous year, are prompting carriers to cut longer and less profitable routes for the winter schedule, according to airport officials.
What are your thoughts on airBaltic’s restructuring and the future of Baltic aviation? Join the discussion in the comments below or subscribe to our newsletter for ongoing updates.
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