Airline keeps flying after survival deals with unions
SAS says that eight unions have agreed to salary cuts and changes to working schedules and pensions, concluding talks that dragged on for several days. The company’s shares rose on the deal, which could have resulted in bankruptcy if the talks had failed. However, airline industry experts are questioning SAS’s claim that it can now continue as an independent carrier.
“Although they are lowering their costs by SEK 3 billion (around €350 million), they will still be a high-cost company,” Kenneth Sivertsen, an analyst at Arctic Securities, commented. “I think they will be taken over. As a stand-alone company they will be squeezed between low-cost airlines and the huge flight carriers, such as Lufthansa and Air France.”
The members of one union, the Danish Pilots Union, still have to vote on the agreement, but SAS describes this as a technicality. One of the leaders of the Norwegian cabin crew union, Espen Pettersen, said: “It has been a very gruelling process. We have made big concessions in this agreement. We are not very happy, but we felt we had no other choice but to sign to secure the jobs and the company.”
[photo courtesy SAS]