Finnair has announced that it will outsource its engine and component services division, leading to the loss of approximately 280 jobs.

The airline has signed a Memorandum of Understanding (MoU) with the Swiss SR Technics, which will lead to the restructuring of Finnair’s own component services division and the closure of its engine services operations. These operations currently employ approximately 350 people, and the planned changes would result in the reduction of approximately 280 positions.

”This plan is based on a thorough analysis, where we first examined the costs and structures of our own operations, and then compared the results to tens of external service providers,” said Ville Iho, Finnair’s Chief Operating Officer. “Our own engine and component services are unfortunately too small in scale to be cost efficient enough in the long term.”

“This is naturally difficult for our personnel,” added Kimmo Soini, Managing Director of Finnair Technical Services. “Our personnel are highly competent but our volumes are not competitive. There is overcapacity in the market and the competition is intense. We explored partnership opportunities as well, but there was no interest in the market to form a partnership to continue the operations at Helsinki Airport.”

The MoU is a part of a major restructuring plan started by Finnair in August 2011, which is targeting annual cost reductions of EUR140 million (US$183 million) by 2014.

source:http://www.traveldailyasia.com