SAS (Scandinavian Airlines) this week has filed for Chapter 11 bankruptcy protection in the United States. This comes just one day after its pilots went on strike, which has resulted in 80 percent of the airline’s flights being canceled on Tuesday. On Monday, more than half were canceled.
The airline in a press statement said the filing was the “next step in the comprehensive business transformation plan ‘SAS Forward,” a reorganization that would address its financial difficulties, which includes cost reductions of more than $700 million. Yahoo Finance reports that under the plan, SAS aims to transform its network, fleet, labor agreements and other cost structures, eying savings of 7.5 billion Swedish crowns (approximately $715 million) a year. SAS added it expects to re-emerge from the process in nine to 12 months.
Throughout the process, SAS will continue to fly but it noted the pilot strike will affect the flight scheduled. The airline added, “the strike has a negative impact on the liquidity and financial position of the Company and, if prolonged, such impact could become material.” SAS also said it wished to reach an agreement to end the strike as soon as possible. The strike is the result of collapsed talks over wages.
Tip: Customers who have booked a flight with SAS are advised to check if their flight is impacted by the strike at www.sas.se/travel/flightstatus/.
Since it’s peak season, the possibility to rebook affected customers to equivalent flights will be highly limited, SAS said. Customers whose flights are canceled that are unable to find viable alternative flights will be offered the options of either accepting a refund or rebooking their ticket to a later date or to arrange alternative means of travel themselves and seek reimbursement from SAS.
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