• 

  SAS

  IATA/ICAO Code:

  SK/SAS

  Airline Type:

  Full Service Carrier

  Hub(s):

  Copenhagen Airport, Oslo Gardermoen Airport, Stockholm Arlanda Airport

  Year Founded:

  1946

  Alliance:

  Star Alliance

  Airline Group:

  SAS Group

  CEO:

  Anko van der Werff

SAS is facing a difficult summer ahead as a range of issues continue to plague the airline. With the airline and its pilots' union currently at loggerheads over the prevailing situation, the next few months look like they will not be easy for the Scandinavian-based carrier.

Staff shortages are hitting SAS hard

SAS has announced that it will be canceling around 4,000 flights throughout the months of May, June, July, and August of this year. Given that the airline had planned to operate around 75,000 flights during this period, the cancelations represent approximately 5% of the airline's total planned operation.

While the airline is putting the cancelations solely down to post-COVID staffing constraints, other factions at the airline see the situation somewhat differently. According to the airline, it is struggling financially, and staff shortages caused by the airline laying off staff during the pandemic are the main issues causing the cancellations.

The inability to recruit enough staff quickly enough in the face of rising demand for passenger air travel means that reducing its flight schedule is the inevitable consequence of these factors. It has already drafted in airBaltic to operate some services on its behalf this summer.

The airline is keen to point out that it is not entirely alone in facing such issues. In an interview with the E24 newspaper, the airline cites various other European airlines, such as British Airways (which has canceled 16,000 flights this summer), that have been forced to reduce flying schedules recently due to staff shortages.

According to the airline, upscaling in the post-pandemic age is proving far trickier than the industry envisaged, and SAS is not immune from this issue.

According to John Eckhoff, SAS' Head of Media Relations, the airline is doing what it can to maintain its planned summer schedule,

“There is both a shortage of personnel and to some extent also delays in deliveries of aircraft. Many people are going through safety training or refresher courses in a simulator at the moment. Many have been hired since being laid off in connection with the pandemic. In the meantime, those affected by the cancellations will be rebooked to the nearest flight. For most people, this will means other flights on the same day. ”

Lack of flight crew is the main issue

SAS released hundreds of pilots at the start of the pandemic. In an attempt to entice those who were released back, the airline has recently set up a subsidiary through which pilots and cabin crew released at that time can re-apply for their positions, albeit on a different remuneration package to the one they were forced to leave.

This move, however, has proved deeply unpopular with the airline's pilot union, which is openly unimpressed with the airline's methods of enticing former pilots back. While other airlines have used this method in the past, it has rarely proved a popular move with unions, who see it as airlines wishing to have their cake and eat it when attracting recruits.

Pilots' trade union blaming the management for cuts

While SAS leadership is keen to blame the lack of staff for causing the flight cancellations, the trade union responsible for representing the pilots at the airline is taking a very different view. Roger Klokset, leader of the Norwegian SAS Pilots’ Association, has said that 450 of the SAS pilots dismissed by the airline remain unemployed.

Mr Klokset also believes that SAS is not acting quickly enough to recruit these former flight crew. He claims that SAS is also actively seeking qualified pilots from elsewhere in Europe who hold current licenses to fill the empty roles, giving them preference over those former SAS employees who might require refresher training.

Storm clouds ahead for SAS

Like most airlines, SAS has experienced a tough two years. While passenger demand is now rebounding across its Scandinavian home base countries, the airline struggled over the recent 2021/22 winter and posted a higher than expected Q4 2021 loss of US$276 million. Predating the pandemic, the relationship with its pilots' unions was often fraught. In 2019 alone, SAS' problematic labor relations frequently hit the headlines.

Fast-forward to 2022, and in March, the airline announced that it needed to transform its business, including its network, fleet, labor agreements, and other cost structures, to achieve a targeted US$800 million-plus cut in annual operating costs. This, SAS said at the time, was crucial if it was to survive and be able to compete with the growing competitive environment in which it operates.

Key elements of the announced plan include the aforementioned annual operating cost savings, a redesigned fleet, network, and product offerings, positioning itself as a leader in sustainable airline operations, digital transformation, and strengthening SAS’s balance sheet by deleveraging and raising new capital.

However, the airline's plan to 'redesign' the fleet, a thinly disguised term for a fleet reduction, was not received well by SAS pilots and was the main issue that caused pilots' unions to walk out of negotiations with the airline's management back in March of this year.

SAS exists in an increasingly competitive market

The airline faces competition across its short-haul network from an increasing range of players, including Flyr, Norwegian, and Ryanair. Soon-to-launch Norse Atlantic Airways will be offering Scandinavian travelers another way to traverse the Atlantic for business or leisure purposes on the long-haul front.

With the cost of aviation fuel hitting all-time highs and the costs associated with re-booking and re-accommodating its passengers on other services, perhaps even on those operated by its competitors, the immediate future is not looking particularly plain sailing for the Scandinavian carrier.

It will need to bring its pilots back onside as quickly as possible if it hopes to return to its former glory as the first choice carrier for air travel in Norway, Sweden, and Denmark. With competitors increasingly encroaching on its key markets and routes, swift changes are required to assure the airline of its future.

However, with thousands of flights canceled in the coming months and thousands more passengers having their travel plans disrupted and being inconvenienced, this latest announcement will do little to restore public confidence in the beleaguered airline.

What do you think of SAS' proposed cuts to its services? How do you see the future prospects for the Scandinavian airline? Let us know your thoughts in the comments.

Source: E24