SAS Scandinavian pilot strikes and no new funding from Norway
It’s a troubled week for Scandinavian carrier SAS. The airline warns a possible pilot strike will have a big impact on its operations in the midst of the busy summer peak travel period, while Norway’s government has announced it will not be investing fresh capital into the struggling company.
SAS is trying to carry out a restructuring process, which includes cost cuts of SEK 7.5 billion ($746 million), the conversion of around SEK 20 billion ($2 billion) of debt and efforts to raise at least SEK 9.5 billion ($953 million) in new funds.
Pilots’ unions from Sweden, Denmark and Norway have sent the airline a notice of conflict in a row over the cuts, meaning walkouts could start soon.
“Mediation is ongoing but if no agreement is reached before 29 June 2022, the pilots’ unions will go on strike,” SAS said in a statement on June 27, 2022.
The airline said it expected any strike to have a “substantial” impact, noting that there are not many alternative flights available to rebook customers on because it is peak season.
SAS said customers who are booked onto flights between June 27 and July 3, 2022 can rebook free of charge onto another flight within the next year. It also cautioned that customer service staff would be busy and advised passengers to use self-booking options where possible.
“SAS truly apologizes for the inconvenience this causes impacted customers,” the airline commented.
Government help?
Part of the airline’s restructuring involves asking shareholders for help with financing. The government of Denmark on June 10, 2022 said it had agreed to accept a write-down and conversion of its existing financial participation and invest new equity into SAS. Sweden announced on June 7, 2022 that it would not invest new capital, but would convert existing debt.
On June 28, 2022, the Norwegian government announced it will convert its debt holding in the airline into equity, but not invest any new capital into the airline, a similar move to Sweden.
That means of the airline’s three government stakeholders, only Denmark has agreed to invest new funds in SAS.
“SAS wants to express its appreciation of the support provided by the Norwegian State over the years and most recently during the pandemic,” the airline commented in a statement in response to the Norwegian announcement.