New brooms sweep clean, as the saying goes. Latvian national airline airBaltic is now following this motto by placing the airline’s management in the hands of an experienced financial expert. His name: Erno Hildén. The Finnish native will take command of airBaltic on December 1, 2025. His main job will be to drive new growth.
“I appreciate the trust placed in me by the Supervisory Board. It is a privilege to take on this responsibility at airBaltic. My focus will be on ensuring continuity, supporting the Executive Board, and working together with the team to maintain operational stability and contribute to the company’s long-term objectives. I also look forward to applying my international aviation and financial experience to support the company’s next stage of development,” exclaimed Erno Hildén following his nomination.
Tough market conditions
Until DEC25, Pauls Cālītis will lead the airline as interim CEO but will resume his duties as Chief Operating Officer (COO) once Hildén takes office. Hildén has earned a reputation in the industry as an excellent restructuring expert at Scandinavian Airline SAS, which was in serious financial trouble at the time. As a member of the SAS management team, he was also responsible for securing the company’s solvency by tapping into new sources of financing. With Air France’s recent acquisition of a majority stake in SAS, Hildén’s chapter at SAS has also come to a close. His appointment as CEO of airBaltic is evidence of the airline’s intention to grow and consolidate its market position. It has suffered setbacks in the recent past, losing part of its route network to Russia due to the Putin regime’s invasion of Ukraine and the subsequent sanctions imposed by the West.
Lufthansa is on board
But now the Latvian airline is poised to expand once again. To finance this expansion, the airline is receiving €14 million from the government in Riga. The Lufthansa Group contributes the same amount. In return, it secures itself a 10% stake in the airline which includes getting a seat on the supervisory board of the Latvian state-owned company.
Lufthansa’s investment is based on a cooperation that has existed for several years, in which Lufthansa leases aircraft and crews from AirBaltic under a wet lease agreement. According to a statement, the conversion of the previously acquired convertible shares into common shares, which has now been announced, will enable the Lufthansa Group to improve the quality of its route network and tap into additional markets.
Further investors are welcome
Lufthansa’s investment is based on a long-standing partnership in which Lufthansa leases aircraft and crews from AirBaltic under a wet lease agreement. According to a press release, the conversion of previously acquired convertible shares into common shares will enable the Lufthansa Group to improve the quality of its route network and tap into additional markets.
Latvian Transport Minister Atis Švinka stated that “having one of the aviation industry leaders as a strategic investor in airBaltic increases the value of our national airline and confirms its leading position in the market.” He added to this that this will help attract other investors since it demonstrates the sustainability of the Baltic airline’s business strategy.
Cargo is a side product
It serves more than 70 destinations from its hub Riga International (RIX), using a uniform fleet of 50 Airbus A220-300 aircraft. It has also placed 40 orders for this Canadian-built Airbus variant. The A220 has a nonstop range of 6,700 km and the belly compartments offer 28 cubic meters of space for air freight. This is slightly less than the cargo capacity of its competitor, the Boeing 737 MAX. However, ground staff is needed to load and unload both aircraft types, as the lower deck compartments are too small to fit standard ULDs. Meanwhile, investors in Estonia and Lithuania are still evaluating a financial commitment in airBaltic. In contrast, the Estonian government has rejected a stake in the carrier on the grounds that it would rather spend the money on expanding Tallinn Airport as it expects air traffic to grow successively. By 2030, 5 million passengers are expected there. Tallinn Lennart Meri Airport recorded 3.5 million passengers in 2024, an 18% increase year-on-year.
