LONDON – Ailing Scandinavian carrier SAS has published its first-quarter results for the year 2022, and has accepted that the carrier has been burdened by an ‘uncompetitive cost structure’ which has hindered the company to reach its full potential in order to complete the aviation growth.
Posting its first quarterly results with staggering quarterly losses, the company has said that the last two years have been challenging in the history of aviation and the future remains unpredictable.
Concluding on this, the management has agreed that ‘travel patterns and market conditions are changing, and it will have an additional impact on SAS, thus now, more than ever, SAS is in need of a new start.’
Having observed and witnessed the tragic events over the past two years and affecting balance sheets, SAS has crafted “SAS Forward” strategy to put the airline back on its profitable route with securing long term competitiveness, developing efficient as well as a profitable business, and thus reincarnating the products, airline’s image, and overall competitiveness in the aviation world.
The airline is determined to transform its business in-network, fleets, labor agreements, and verticals of other cost structures, and thus aiming to save US$799 million (Swedish Krona 7.5 billion) per year.
Key elements from the SAS Forward plan include:
- reduction in annual cost by SEK7.5 billion by reducing costs with burden sharing across all stakeholders and creditors.
- The next step of this plan focuses on refreshed and redesigned fleet planning, network operations and uplifted product offering, with new network principal, with fleet and product mix to enhance future SAS customer experience.
- Digital transformation if one of the key elements of this plan, where SAS is undergoing major digital transformation, improving customer experience thus driving financial growth.
- SAS has decided to reposition its stand in industry by leading sustainable aviation, investing in modern fuel-efficient aircrafts, SAF’s, upcoming technology and sustainable products incentivising consumer behaviour and choices.
- SAS has outlined that it will also be improving its efficiency and adapting itself to changing market demands and competition thus throttling up its operational platform.
- With the overall attention towards cost reduction program and revitalisation of balance sheet with emphasis on strengthening carriers position in liquidity in order to allow them to further invest in its network boost, personnel’s and in SAF’s.
SAS is positive that with the new SAS Forward strategy, the airline will be in a better position to attract potential capital infusion and achieve the SEK7.5 billion annual cost savings.
SAS has also stated that it will be retaining the services of Seabury Securities LLC and Skandinaviska Enskilda Banken AB as their financial advisors to execute the strategy smoothly.