SAS seeks volcanic ash compensation

Scandinavian airline SAS is hoping to emerge financial unscathed from the recent air traffic disruption, with the airline planning to apply for 640 million kronor ($89 million) in EU aid.

SAS seeks volcanic ash compensation

“We think it’s reasonable compensation,” said John Dueholm, vice-CEO of SAS.

The figure will be the company’s goal when the sector organisation AEA sits down on Monday to open negotiations with the EU’s transport commissioner Siim Kallas, reports the Danish Børsen daily.

Dueholm believes that the compensation negotiations with the EU should take into account the fixed costs associated with having planes on the ground, including salaries.

A further issue up for discussion will be the cost incurred by airlines to fund hotel and food expenses for stranded passengers while the Icelandic ash cloud held Europe’s skies in its grip.

SAS on Thursday announced the first week of the chaos had cost them 460 million kronor, the airline has now also added a further 180 million kronor for Thursday and Friday. SAS is now demanding the entire sum in compensation.

International air travel industry body IATA projects that the global cost of the Icelandic ash cloud has cost the equivalent of about 12 billion kronor.

SAS flights are reported to be running as normal on Monday. European skies began to reopen last Thursday and normal service has been in operation since Saturday.

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.


SAS remains in the red as pandemic squeezes airlines

Scandinavian airline SAS reported Thursday a wider quarterly loss, driven by the Covid-19 pandemic, but said it hoped things would improve in the summer as vaccines roll out.

SAS remains in the red as pandemic squeezes airlines
An SAS plane at Oslo's Gardermoen airport in December. Photo: Stian Lysberg Solum/NTB/TT


For its first quarter — November to January — SAS booked a net loss of 2.05 billion Swedish kronor ($249 million, 204 million euros), compared to a loss of 861 million Swedish kronor a year earlier, the company said.
Revenue, reflecting the drop in traffic, plunged 77 percent year-on-year to 2.28 billion Swedish kronor.
The number of passengers fell to just under one million, over five million less than the same period a year before and a drop of 900,000 compared to the preceding quarter.
The carrier has already laid off 5,000 staff — 40 percent of its workforce — having in March furloughed 90 percent.
The company's CEO, Rickard Gustafson, announced last month his departure after ten years at the head of SAS, to take over as head of the Swedish ball-bearing maker SKF.
“In general, restrictions are currently more stringent than they were in spring 2020,” Gustafson, due to be replaced by July, said.
Gustafson said the arrival of vaccines gave “hope that restrictions will ease and that we will see an increase in travel toward summer 2021.”
The company said it was preparing for the potential resumption of flights on 180 routes, “provided that the prevailing travel restrictions will allow people to travel.”
But SAS still said it expected that “demand is most likely to remain highly limited in the foreseeable future,” with more normal levels returning only in 2022.