The regular Monday coalition meetings take place to align positions where possible a day before the regular cabinet meetings on Tuesdays.
Political pressure has been mounting on the airBaltic board – and particularly CEO and Chairman Martin Gauss – in the wake of the announcement earlier this week that thousands of summer flights will be cancelled as a result of longer-than-expected engine maintenance on airBaltic’s fleet.
airBaltic has pointed out that the extended engine maintenance issues are completely beyond its control, being the decision of engine builder and maintainer Pratt & Whitney. However, airBaltic was told about the longer-than-planned time it will take to overhaul the engines just before Christmas, but waited until the New Year to make any public announcement on the matter.
The new turmoil around the company in which the Latvian state holds a 97% stake also threatens to disrupt plans for a much-discussed but yet-to-be-announced Initial Public Offering (IPO) of its shares, the status of which is currently uncertain.
Despite being credited with turning an ailing airBaltic around and making it the Baltic states’ most important airline, Gauss has also faced long-term criticism over several other matters including his high wage, use of large injections of government money into the airline and even his inability to use the Latvian language, all of which remain in the background whatever the technicalities of the engine maintenance contract between airBaltic and Pratt & Whitney.
What the government ultimately decides to do remains to be seen, but could have a profound effect upon any IPO.
Economics Minister Viktors Valainis (Greens and Farmers Union) has been calling for executive management changes including the firing of Gauss, while Transport Minister Kaspars Briškens (Progressives) has instead suggested the airline’s supervisory council (which is supposed to oversee the work of management) should be looked at, given that some recent information about the progress of the IPO has come from council member Klāvs Vasks’ social media posts.
Two political forces in opposition in parliament – the United List and Latvia First – have also expressed their support for a change in the company’s management.
In turn, Prime Minister Evika Siliņa (New Unity) said she expects an offer from the Minister of Transport for the direction of the strategic development of airBaltic, including a vision for the management of the company. As informed by the Prime Minister’s advisor on strategic communications Elīna Lidere, Siliņa has emphasized that the Ministry of Transport, as the holder of a controlling stake in the airline, must implement the tasks set by the government.
“It is also the responsibility of the capital company itself to assess the risks and act economically as a good and careful owner. Since we have given the Minister of Transport political freedom of action, I expect him to make a proposal for the advancement of this issue, including regarding the management of the company,” said Siliņa.
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