PPRuNe Forums


Rumours & News Reporting Points that may affect our jobs or lives as professional pilots. Also, items that may be of interest to professional pilots.

Reply
 
Thread Tools Search this Thread
Old 11th Nov 2012, 08:16   #1 (permalink)
Thread Starter
 
Join Date: Feb 2009
Location: Up in the air. Sweden sometimes
Posts: 85
SAS close to bankruptcy

SAS close to bankruptcy. Long analysis in link, you need to googletranslate it yourself, it´s pretty long. Headline: "Everybody are tired of SAS".

Till slut har alla tröttnat på SAS | Nyheter | Expressen | Senaste nytt - Nyheter Sport Nöje TV

Last edited by paparomeodelta; 11th Nov 2012 at 09:53. Reason: spelling
paparomeodelta is offline   Reply With Quote
Old 11th Nov 2012, 11:34   #2 (permalink)
 
Join Date: Jan 1999
Location: north of barlu
Posts: 5,967
I can't see it happening

I don't think that the scandinavian governments will let SAS go to the wall and leave the market to those with a red nose.
A and C is offline   Reply With Quote
Old 11th Nov 2012, 11:36   #3 (permalink)
 
Join Date: Jan 2006
Location: here, there, everywhere
Posts: 284
Haven't we heard the same about Belgian and Swiss governments a couple of years ago?
Stuck_in_an_ATR is offline   Reply With Quote
Old 11th Nov 2012, 11:52   #4 (permalink)
 
Join Date: Feb 2003
Location: Planet Earth
Posts: 46
This has nothing to do about "Red Nose" company.....but simply SAS running out of money and unable to make money in its current state....and when Governments (taxpayers) have to bail out the company by promise to pay Bank loans in case of bankruptcy it will not work.....They may have problems with EU with the issue of Government support....and likely have to cut a lot of jobs and change agreements with the unions.
manfromnorth is offline   Reply With Quote
Old 11th Nov 2012, 12:25   #5 (permalink)
Thread Starter
 
Join Date: Feb 2009
Location: Up in the air. Sweden sometimes
Posts: 85
Leaking from negotiations:

Governments give guarantees to banks for new loans
1.000 have to go
15% salary reduction flat
paparomeodelta is offline   Reply With Quote
Old 11th Nov 2012, 12:25   #6 (permalink)
 
Join Date: Jan 2006
Location: Europe
Posts: 49
Analysis? A biased article in a Swedish tabloid, based more on affection rather than facts can hardly be called an analysis.

Most of what is written about the situation is based on what another Swedish paper, Dagens Industri, has published over the last couple of months. DI's reputation has the last couple of years gone down the drain and are referenced as the tabloid among Swedish business newspapers.

No doubt SAS has problems. The figures just doesn't add up these days.

Question is what can be done? Costsaving among staff is usually the first thing that management proposes, always with the same argument that "all other costs are equal to our competitors".

Given the annual reports from the biggest competitors in Scandinavia though, SAS cost structure would still be more than twice of Ryanair and 25% higher than Norwegian even if all of SAS 15,000 employees would be working for free. But of course, blame the staff...
linmar is offline   Reply With Quote
Old 11th Nov 2012, 12:26   #7 (permalink)
 
Join Date: Feb 2009
Location: Worldwide
Posts: 580
Isn't the Expressen newspaper a tabloid known for being more interested in sensationalism than reality?
KBPsen is offline   Reply With Quote
Old 12th Nov 2012, 00:59   #8 (permalink)
 
Join Date: Apr 2011
Location: Doha
Age: 6
Posts: 283
And look what happened to Spanair
Black Pudding is offline   Reply With Quote
Old 12th Nov 2012, 01:26   #9 (permalink)
 
Join Date: Jun 2010
Location: Stairways to heaven
Posts: 346
15% cut will not be enough. A quick and dirty below.

All cost being the same across the industry. i.e. lease, fuel, interest, landing fees etc, the single highest cost is labour.

There is better data from SH&E or BCG, but this one is easy to read
Where your airfare really goes - Fortune on CNNMoney.com

Labour cost taken from eurostat (or European Commission).
Eurostat Home

Denmark is roughly 40% higher than Sweden and Norway is roughly 30% higher than Sweden.

Compare this to e.g. Poland, which has a highly qualified labour force, and has less than half of Sweden's labour cost. Even Germany has lower labour cost than Sweden.

So, comparatively, roughly 30% of your entire cost is halved in case of LOT, giving more room for fleet renewal and better fuel economy, better customer service (and satisfaction) and thereby can compete more effectively.

This very simple calculation should be easy enough to follow even for the unions.
jackx123 is offline   Reply With Quote
Old 12th Nov 2012, 02:43   #10 (permalink)
Person Of Interest
 
Join Date: Jan 2000
Location: Floral City, Florida, USA
Age: 62
Posts: 834
Do they still have a stake in Air Baltic?
DownIn3Green is offline   Reply With Quote
Old 12th Nov 2012, 04:13   #11 (permalink)
 
Join Date: Feb 2007
Location: Land of Ice and Fire
Posts: 318
Over paid fools in management

One of the most basic "rules" for keeping costs down, is ONE TYPE! For years SAS was M-D based and the relationship to the factory regarding training, parts, maintenance etc were exemplary. The next generation of MD was killed by SAS' defection to the 737. It entailed a complete revamp of training philosophy, technical staff had to be retrained, all the pilots, even the emergency training of the FAs, parts, tools......hugely expensive.

Then they went and bought Airbus?...so now there are MD 80s and 90s, AB of at least three versions, CJs, Dash 8s, 737......

This matter alone would be enough to kill the company cost-wise. Of course, operating one type might not have covered every route and so one LR type might have been added, but this in such a small company?

Add to that the poor service level, confusion as to whether they will be a regional, international, feeder for LH, sell off of profitable units during earlier crisis times.......

....and that the director of this fiasco earns 8.8 million kr plus 2.2 million in pension, compared to say, Norwegian's director (note, a company that is making money!!!!) who gets 1 million and 233,000 in pension.......that this carries through to all the clowns (mis)managing the company, and you have an idea why they are in the situation they are!

If you read the history of the company, the types who started it and made it a success, then introduced BS psycho-testing which made certain that this type never got hired! Instead they got too many arrogant prima donnas. If you have time to run a farm or a consulting business alongside of your job, then you are not working enough hours.

So cut the salaries of the small fish......it will never be enough, because it is rotten at the top.

A shame, but in a healthy marketplace, the robust and flexible will survive, while the rigid and arrogant will die.....Sabena, Eastern, Swiss........Braniff, NW.........
FerrypilotDK is offline   Reply With Quote
Old 12th Nov 2012, 07:40   #12 (permalink)
 
Join Date: Apr 2012
Location: Russia
Posts: 75
SAS has been close to death for years, more is the point they were part share in Estonian air until 2010,- another regional lame duck that has been bailed time and time again by the stupidity of the Estonian government, who are too proud to let it die. That must have sucked out a lot of spare cashflow for years.

SAS sells off Estonian Air shares

Market forces should be allowed to take their course, AND should be the same for all.
Air Baltic, SAS, EA all should be allowed to go bust, especially as AB don't respect any EU laws, and routinely rely on the Riga-LV government hand outs to keep their shambles that passes for a "budget" airline flying.

Had this happened already, I guess we wouldn't have had the miserable spectacle of Malev, (which was a good AL) the simply abusive dominance of the bucket jobs like Ryan or the messy Wizz taking over, when they simply abuse their way to the top through renamed subsidy.

It seems to me, in northern Europe it's mostly a race to the bottom with "customer service" and reliability placed last priority, with a total inability to work together and do strategic long term planning, rather than "the winner takes all".

High time for a good clean out before the triple dip recession forces them to the wall for good.
up_down_n_out is offline   Reply With Quote
Old 12th Nov 2012, 13:44   #13 (permalink)
 
Join Date: Apr 2005
Location: UK
Posts: 460
BBC News - Airline SAS to cut jobs and pay

Big numbers indeed !
Joetom is offline   Reply With Quote
Old 12th Nov 2012, 13:56   #14 (permalink)
 
Join Date: Jul 2005
Location: Teesside
Posts: 443
For ex-SAS people like me, this is a sad sign, but it's not 1985 any more, and as Jan Carlson identified way back then, geography, cost base and population will never be on their side, and the lo-co carriers have come to dominate like no-one would have ever predicted.

Actually, Carlson gave closure/take-over of SAS as one of the possible 21st century outcomes in the mid-eighties, unless costs and productivity issues were addressed. I hope it does not come to this.

Last edited by Midland 331; 12th Nov 2012 at 13:58.
Midland 331 is offline   Reply With Quote
Old 12th Nov 2012, 14:26   #15 (permalink)
 
Join Date: Nov 2007
Location: Munich, Germany
Posts: 217
I read somewhere that SAS has to deal/fight/negotiate with 36 different trade unions!

I worked there briefly 25 years ago; a fantastic working place with a pride and esprit de corps among the employees which I have never seen since.
EDMJ is offline   Reply With Quote
Old 12th Nov 2012, 14:29   #16 (permalink)
 
Join Date: Jul 2005
Location: Teesside
Posts: 443
>I worked there briefly 25 years ago; a fantastic working place with a pride and esprit de corps among the employees which I have never seen since.

Oh yes indeed! This cynical and non-corporate Brit was immensely proud to work for them.
Midland 331 is offline   Reply With Quote
Old 12th Nov 2012, 14:39   #17 (permalink)
 
Join Date: Oct 2012
Location: toofaraway
Posts: 224
EDMJ

"I worked there briefly 25 years ago"

Was that before Jan Carlzon built his glass palace HQ? I used to go there often and was amazed at the culture. They had a well paid army who would evaluate new planes for months or years, only for it all to be overturned by a quick board decision. Hence the MD/737/Airbus fleet mess.

Plus the cabins seemed to be designed by the unions for the maximum comfort of the cabin crew.

It was obvious then and it still is now that the population of the 3 countries can't support 3 hubs, and deleting long haul from Oslo or Stockholm sends the pax via LHR or AMS, not CPH.

The writing has been on the wall for a very long time.

P.S. for an outsider, they were good honest friendly people to work with. Including their Norwegian jokes. Apparently the Scots are not so tight after all.

Last edited by toffeez; 12th Nov 2012 at 15:00.
toffeez is offline   Reply With Quote
Old 12th Nov 2012, 14:43   #18 (permalink)
 
Join Date: May 2002
Location: Redonda
Age: 51
Posts: 42
More indepth.......

SAS to cut jobs and sell assets in survival plan | Reuters

"Gustafson said the company needed to get the deal with unions in place in a week."

"Staff will take pay cuts of up to 17 percent, depending on what part of the organization they work in. Cabin staff will see their pay reduced on average by 12 percent."

Wadadli is offline   Reply With Quote
Old 12th Nov 2012, 14:53   #19 (permalink)
 
Join Date: Jul 2005
Location: Teesside
Posts: 443
Toffeez

I did nine years there, never got to STO HO, but attended many courses at the smaller version of the palace you describe, in CPH.

Yes, the style was indeed lavish, but at the time, circa 1986, SAS were the third most profitable airline in the world after AA, plus one other (SQ?), yet were around number twenty two in rank of number of passengers carried, if my memory serves me right. One of their highest yield routes was LHR-ARN, which was around £530 return C-class, and it had some of the highest load factors of the whole network. So they had the money to pay generous per diems, and furnish their offices in solid pine. In fact, I'm sitting at one of their solid pine desks right now. I hope they don't want it back.

When Midland wet-leased a DC9-21 for MME-LHR circa 1994, the cabin crew were astonished that Midland could serve drinks, a hot meal, and hot towels on such a short sector. And it always amused me to baord one of the MD80s and find that the space for the first three rows of seats (at least) was taken up by a huge galley.

And the London town office. Staffed by around 100. I never did figure out what some of the middle-ranking managers actually did. Mr O'Leary would have laughed like a drain.

Last edited by Midland 331; 12th Nov 2012 at 17:10.
Midland 331 is offline   Reply With Quote
Old 12th Nov 2012, 15:30   #20 (permalink)
short flights long nights
 
Join Date: Aug 1999
Posts: 2,511
I have flown LHR ARN with SAS in J about 20 times. The seat is great..but the service leaves a lot to be desired....I mean for what i payed if i ask for anoher glass of wine, it cant be that hard,without the "look"...
SOPS is online now   Reply With Quote
Reply


Thread Tools Search this Thread
Search this Thread:

Advanced Search

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off



All times are GMT. The time now is 02:25.


© 1996-2012 The Professional Pilots Rumour Network

SEO by vBSEO 3.6.1