Kulbergs: airBaltic's situation is very serious, new business plan sets direction

Prime Minister Andris Kulbergs (AS) said at Tuesday's cabinet meeting that airBaltic's newly approved business plan outlines the direction the airline needs to take, but stressed that the plan alone is not enough — it must also convince potential investors, the government, parliament and taxpayers.

Kulbergs said the national carrier's situation is very serious and must be discussed openly with the public. Citing assessments from international rating agencies, the company's financial state, and the need to raise €225 million in temporary financing, he said airBaltic has reached a decisive stage of development. He linked the current problems to poorly considered decisions made by previous governments, referencing the former transport minister's handling of the matter.

Strategic importance, but not unconditional support

According to the prime minister, airBaltic is strategically important for Latvia's international connectivity, Riga Airport's standing, business, investment and tourism — but that does not mean unconditional state funding. Transport Minister Rihards Kozlovskis has been tasked with working alongside airBaltic's board, management and international consultants to reach an agreement with creditors and find a strategic investor. The outcome of talks with bondholders will be crucial, and if new capital is needed, any solution must include private capital and creditor participation as well as genuine restructuring. Should state financial involvement require parliamentary approval, the Saeima will have to decide whether to back the company. The new plan is due to be presented to the Saeima's Budget Committee this week.

Plan details

The business plan envisions raising €225 million in temporary financing secured against collateral backing the 2029 Senior Secured Notes, while cutting the planned fleet from 100 to about 40 aircraft by 2031. Riga will remain the airline's main base. A profit-improvement programme aims to deliver around €45 million in annual financial gains. The collateral package is valued at an estimated €506 million. Revenue is projected to reach €1 billion by 2031, while the company posted losses of €44.3 million in 2025.