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SAS And Unions Resume Talks As Pilots' Strike Enters 12th Day

By Dave Simpson

Talks between airline SAS SAS.ST and pilot unions resumed on Friday 15 July as the parties seek to agree on a complicated deal to end a strike that the carrier says is threatening its future.

Details

A majority of SAS pilots in Sweden, Denmark and Norway walked out on 4 July after negotiations over conditions related to the Scandinavian carrier's rescue plan collapsed. The parties had returned to the negotiating table in the Swedish capital on Wednesday 13 July.

"On some of the important points the parties are standing far from each other," SAS chief negotiator Marianne Hernaes said on her way into the talks, adding it was impossible to say if a deal would be reached on Friday 15 July.

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SAS has been struggling with increased low-cost competition for years before the COVID-19 pandemic heaped pressure on the airline industry.

The airline said on Thursday 14 July the strike had caused 2,550 flight cancellations, affecting 270,000 passengers and cost the carrier between $94 million and $123 million.

The carrier cancelled 177 flights on Friday 15 July, amounting to 62% of those scheduled, according to flight-tracking platform FlightAware.

SAS, which is trying to implement cost cuts and attract new investors, filed for US bankruptcy protection on 5 July.

"There are several problems that need to be solved in order to get a solution," said National Mediator of Norway Mats Wilhelm Ruland, but he also said the parties had made progress since the beginning of the talks.

"We will continue to work constructively towards unity now but we are depending of movements from both sides," he said.

Shares in SAS were down 6% on Friday 15 July and have lost more than half of their value since the start of the year.

Pilots employed by SAS Scandinavia, a subsidiary of SAS Group, have said they would agree to limited wage cuts and less favourable terms, but SAS has said that concessions offered so far are not enough for it to carry out a rescue plan announced in February.

Unions are also demanding that pilots who lost their jobs during the pandemic are rehired at SAS Scandinavia, rather than having to compete with external applicants for jobs on less attractive terms at recently created SAS Link and Ireland-based SAS Connect.

Pilots at SAS Link and SAS Connect are not on strike.

SAS, Unions Fail To Find Agreement; Talks To Resume Friday

The above news followed news that SAS SAS.ST and pilot unions failed again on Thursday 14 July to agree on a deal to end a crippling strike that the airline said threatened its ability to access bridge financing without which it may be forced to radically downsize or could collapse.

SAS and the unions were locked in talks throughout Thursday 14 July to end a strike among most of its pilots at the peak of the holiday travel season, over conditions related to the Scandinavian carrier's rescue plan. They abandoned talks shortly after midnight Friday 15 July, as the strike entered its 12th day, with talks to resume later on Friday 15 July.

"There are a number of issues that are important for both parties that must be resolved in order to reach an agreement," mediator Mats Ruland told E24.

Earlier on Thursday 14 July, SAS, whose main owners are the governments of Sweden and Denmark, said the strike threatened the company's ability to raise much-needed capital to fund its reorganisation.

"In such an event, the company will need to consider selling valuable strategic assets under duress while also radically downsizing SAS's operations and fleet," SAS said in a statement.

The parties resumed collective bargaining talks on Wednesday after negotiations broke down on 4 July.

The carrier cancelled 201 flights on Thursday 14 July, or 64% of those scheduled, according to FlightAware.

SAS said the strike so far has caused 2,550 flight cancellations, affecting 270,000 passengers, and cost it between $94 million and $123 million. It has warned that its limited cash reserves will erode quickly if the strike continues.

Long-struggling SAS, which needs to slash costs and attract new investors to survive, filed for US bankruptcy protection on July 5.

"The strike is putting the success of the Chapter 11 process and, ultimately, the survival of the company at stake," CEO Anko van der Werff said on Thursday 14 July.

Pilots employed by SAS Scandinavia, a subsidiary of SAS Group, have said they would agree to limited wage cuts and less favourable terms, but SAS said concessions so far are not enough for it to carry out a rescue plan announced in February.

Unions are also demanding that pilots who lost their jobs during the pandemic be rehired at SAS Scandinavia, rather than having to compete with external applicants for jobs with less attractive terms at newly started SAS Link and Ireland-based SAS Connect.

Danish mechanics, who had been striking in sympathy with pilots, said on Thursday 14 July they were ending their action, a move that means SAS planes in Copenhagen would be serviced and could get back in the air swiftly once a deal with pilots is reached.

Swedish mechanics have not gone on strike. Pilots employed by SAS Connect and SAS Link are also not on strike.

News by Reuters, edited by Hospitality Ireland. Click subscribe to sign up for the Hospitality Ireland print edition.

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