Finnair Oyj - Company Announcement

FINNAIR SEEKS FURTHER COST CUTS OF 100 MILLION EUROS

FINNAIR PLC		STOCK EXCHANGE RELEASE	5.6.2009 12:45


FINNAIR SEEKS FURTHER COST CUTS OF 100 MILLION EUROS

Finnair is seeking cost cuts of over 100 million euros in addition to previous
cost-cut measures of 100 million euros. Of the additional target, 70 million
euros are to be aimed at staff costs being emphasized on next year. 

Finnair's turnover has fallen since the beginning of the year by almost 15 per
cent because of a reduction in scheduled traffic and a fall in the average
ticket price. The aim is for a 15 per cent improvement in productivity. 

“Previously completed savings measures are not sufficient,” says Deputy CEO,
Finnair, Lasse Heinonen. “We have to adjust our costs in line with the fall in
turnover. Unit costs must adapt in line with the decrease in unit revenues. Our
biggest cost item is staff costs, which represent about a quarter of all our
expenditures and that is why savings targets must concentrate in that
direction. Together with our labour unions, we have aimed at models with which
to adapt workforce expenditure in these difficult times.” 

Discussions with labour unions about ways of increasing productivity will be
continued. No decisions about new YT talks (official terms of employment
negotiations) have been made. 

At present Finnair is continuing to implement the cost efficiency program
launched last year, about half of which was directed towards staff costs. Based
on this plan, over 6,000 employees will be placed on varying periods of unpaid
leave this year. The average layoff period is two weeks. In addition, Finnair
has reduced nearly 600 employees. 

Finnair Plc
Communications
5.6.2009