SAS says cost of pilot strike threatens survival

SAS says cost of pilot strike threatens survival

UPDATE DAY

The pilots' strike affecting the Scandinavian airline SAS is costing nearly ten to twelve million euros a day and threatening the “survival” of the company already in financial difficulty, management warned on Thursday . 

The strike, which has been going on for ten days, has already cost “about 1 to 1.3 billion Swedish crowns”, or about 95 to 120 million euros, for an estimated daily cost of between “100 to 130 million crowns”, says SAS in a press release.

Negotiations have continued in recent days in Stockholm between unions and management, without success so far.

More than 2,500 flights have already had to be canceled, affecting 270,000 passengers, according to management.

The day after the start of the strike of a thousand of its pilots on July 4, SAS had announced that it was placed under the protection of Chapter 11 of the American bankruptcy law.

The social conflict “threatens the success of the Chapter 11 process and ultimately the survival of the company,” said company CEO Anko van der Werff, quoted in the statement.

The strike also has a “severe impact on the chances of success” of SAS Forward, the cost-savings and restructuring plan launched by the company in February, he said.

SAS, which employs nearly 7,000 people, mainly in the three Scandinavian countries (Sweden, Norway, Denmark), is also seeking to complete a capital increase plan of approximately 1 billion euros, to have fresh money.

“The company has sufficient liquidity to meet its short-term business obligations without access to new capital. However, a prolonged strike means that the company's limited cash reserves (…) will erode very quickly,” warns SAS.