airBaltic has secured up to €250 million in funding from the Latvian government as it seeks to overcome the coronavirus pandemic.

The carrier grounded virtually all flights in mid-March and has said services are unlikely return to anything like normal until at least the autumn.

Martin Gauss, chief executive of airBaltic, said: “With this new equity investment, we can begin to execute our new business plan Destination 2025 CLEAN which focuses on a new start for airBaltic once international flight resume.

“This will facilitate successful growth for the company once the impact of the Covid-19 crisis begins to ease.”

The Latvian state is the majority shareholder in the carrier, with the cabinet approving the new funds earlier.

The government’s plan, which remains subject to the approval of the European Commission, is to provide its investment to airBaltic in tranches.

Each investment tranche will be provided in line with market rules and will not exceed the losses caused as a result of Covid-19 crisis.

Following such investment, the Latvian state’s shareholding in airBaltic will increase from 80.05 to 91 per cent.

On April 23rd, the supervisory board of airBaltic approved the new business plan of the company presented by the management.

The plan foresees a reduced fleet for the upcoming years, initially resuming operations with 22 Airbus A220-300 aircraft.

The new plan considers the reduced capacity for the years 2020 and 2021, while at the same time foresees return to growth with up to 50 Airbus A220-300 aircraft by the end of 2023.

The additional 30 options of Airbus A220-300 remain for future growth.