Lithuania is preparing contingency measures in case Latvia's AirBaltic reduces services or withdraws from the country, Transport Minister Juras Taminskas said on July 23, as concerns grow over the carrier's financial position, independent Lithuanian news agency BNS and public broadcaster LRT.lt reported on July 23.

As reported by IntelliNews, Latvia is in talks with three potential investors over the future ownership of airBaltic.

Fitch Ratings has placed the airline and its outstanding bonds on negative watch.

The minister said an abrupt suspension of flights would disrupt air connectivity in the short term, but stressed there was no reason for panic while the airline continued operating.

"It would be very unpleasant and, in reality, even a certain shock in the short term if AirBaltic stopped operating flights, but at the moment we are managing the risk," Taminskas told BNS.

He said he would meet Lithuanian Airports management next week to discuss possible responses should AirBaltic cut capacity or exit the Lithuanian market.

"We cannot bury AirBaltic while it is still alive," Taminskas said, adding that the airline continued to provide scheduled services and that authorities were closely monitoring developments, BNS reported.

AirBaltic currently serves all three Lithuanian airports – Vilnius, Kaunas and Palanga.

Taminskas said any reduction in AirBaltic's operations would not necessarily benefit only low-cost airlines, pointing to carriers such as Poland's LOT and Finland's Finnair as potential candidates to expand services.

The carrier cancelled its planned Vilnius–Krakow service earlier this year. In 2025, AirBaltic increased group revenue by 4.2% to €779.3mn, while its net loss narrowed to €44.34mn. Passenger numbers rose 1% to 5.2mn, BNS and LRT.lt reported.

In a statement to LRT, AirBaltic said it continued to implement a revised business plan supported by international advisers and that a bondholders' meeting scheduled for August 3 would consider proposals to secure interim financing.