- IATA/ICAO code:
- Airline type:
- Full service carrier
- Copenhagen Airport, Oslo Gardermoen Airport, Stockholm Arlanda Airport
- Year of foundation:
- star alliance
- Air group:
- SAS Group
- Anko van der Werff
- Stock code:
- Creation date :
- Guillaume Faury
- Head office location:
- Toulouse, France
- Key product lines:
- Airbus A220, Airbus A320, Airbus A330, Airbus A340, Airbus A350, Airbus A380
- Type of company:
It has been approximately three months since SAS filed for Chapter 11 bankruptcy protection in the United States. Prior to entering Chapter 11, the flag carrier had around 105 aircraft in its fleet, of which around 20 were owned by the airline. However, SAS is looking to downsize its fleet as it restructures and has filed a court case dismissing 10 leased planes.
The process so far for SAS
SAS first filed Chapter 11 in early July, a surprising move as the airline’s pilots had just voted to strike at the time. The pilots’ strike made the airline aware of the negative impact of the disruption of flight operations on its liquidity and financial situation. This was especially true as SAS was already struggling financially due to Sweden halting all cash injections, leaving the carrier economically broke in an early post-pandemic era.
Then in August, SAS closed a debtor-in-possession financing for $700 million of credit, which was to be managed by Apollo Global Management. The funding deal would see the Scandinavian carrier funded with the funds needed to meet several conditions while undergoing a restructuring plan. SAS also proposed the SAS FORWARD plan, an initiative to ensure long-term financial stability by reducing costs during its restructuring.
The SAS FORWARD plan detailed a cost reduction of approximately $735 million per year. Photo: Airbus
Reduce your fleet
A key part of the SAS FORWARD plan involves SAS reducing its fleet and getting rid of four CFM International CFM56 engines. As part of the Chapter 11 filing submitted for the aircraft rejection, the airline and its associates said:
“We do not need the excess leased equipment for our commercial operations. Aircraft and engines are no longer part of the fleet or the business plan.”
The fleet reduction will be a turning point for its restructuring plan, as SAS will remove five narrow-body and five wide-body from its fleet. The narrow bodies will include three Airbus A320neos, powered by CFM Leap-1A engines, one Airbus A321 and one Boeing 737-700.
The airline is also considering getting rid of two Airbus A350-900s, although these are the only relatively new aircraft type in the fleet. The two Airbus A350s were identified as MSN378 with registration SE-RSB and MSN391 with registration SE-RSC. Both aircraft were delivered to SAS in 2020.
The other three widebody aircraft to be rejected are the Airbus A330-300, starting with MSN1665, registered LN-RKS and delivered in 2015. There are also MSN1697 and 1715, both delivered in 2016 and currently registered LN-RKT and LN-RKU. , respectively. The 10 discarded planes are mostly stationed at the airline’s main bases in Copenhagen, Oslo and Stockholm.
SAS previously used its Airbus A350s to operate to destinations such as Beijing, Los Angeles and San Francisco. Photo: N509FZ via Wikimedia Commons
While it is unfortunate to see so many relatively young aircraft discarded, SAS did not choose them at random. These specific aircraft were selected after analyzing which aircraft leases were significantly superior to the market or no longer aligned with its restructuring objective, as the filing highlights:
“Although we sought various concessions from aircraft lessors before entering Chapter 11, including amending existing leases at market terms and returning the aircraft, we were unable to reach the level of concessions necessary to successfully implement “SAS Forward”.
It is also not the first time the airline has rejected a leased aircraft, as in late August SAS agreed to a lease termination covering an Airbus A321, MSN1848, and registered as LN-RKK. And it is entirely possible that the fleet and spare engine reduction will not be complete, as SAS stresses that a further review of the fleet and spare engine plan remains underway to determine future reductions.
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