Latvian carrier airBaltic has announced a net loss of €118 million for 2024, despite achieving record-breaking revenue and passenger numbers. The airline attributed the financial setback to external factors, including accelerated depreciation on Pratt & Whitney engines, currency fluctuations, and rising operational costs.
Strong Revenue Growth Overshadowed by Rising Costs
AirBaltic recorded a 12% increase in revenue, reaching nearly €748 million, and transported over eight million passengers for the first time in its history. However, these achievements were outweighed by mounting expenses, particularly the €73 million depreciation costs linked to engine maintenance issues. The airline faced significant operational disruptions due to ongoing global challenges with Pratt & Whitney engines, a problem affecting multiple carriers worldwide.
CEO Acknowledges Challenges but Maintains Optimism
Martin Gauss, President and CEO of airBaltic, acknowledged the mixed results of 2024, stating:
“2024 was a year of both growth and external challenges. We set new records in passenger numbers and revenue, with scheduled flights busier than ever. Demand reached new heights, setting fresh benchmarks in our history. However, industry-wide engine maintenance issues and currency fluctuations impacted the financial performance. Nonetheless, these are temporary setbacks that do not change our long-term trajectory.”
Fleet Expansion and Strategic Growth
AirBaltic’s reliance on the Airbus A220-300 fleet, powered by Pratt & Whitney engines, has exposed the airline to maintenance-related setbacks. These issues necessitated accelerated depreciation costs, significantly impacting financial results. Additionally, the depreciation of the euro against the US dollar further strained the airline’s financial standing.
Despite these challenges, airBaltic continued to expand its fleet, introducing three new Airbus A220-300 aircraft in 2024 and securing orders for 10 more. The airline remains the largest global operator of the A220-300, with 50 in service and a goal to reach 100 aircraft by 2030. However, unresolved engine reliability concerns may require further adjustments to its long-term operational strategy.
ACMI Expansion Strengthens Business Diversification
Beyond its core passenger operations, airBaltic has expanded its ACMI (Aircraft, Crew, Maintenance, and Insurance) business, leasing aircraft to airlines across Europe. The Lufthansa Group remains its largest ACMI client, reinforcing the airline’s strategy of business diversification.
Looking Ahead
Despite facing financial headwinds, airBaltic remains committed to its growth strategy. With record passenger numbers and expanding fleet operations, the airline continues to navigate industry challenges while positioning itself for long-term success.
