SAS weakened by Skyways bankruptcy

Airline left without another vital partner after the second bankruptcy of a regional Scandinavian carrier this month

May 23rd, 2012 5:35 pm| by admin

A Ukrainian billionaire is causing havoc in the Scandinavian airline industry after he closed two regional airlines in the past few weeks.

Hundreds have lost their jobs and dozens of planes are grounded after Igor Kolomoisky closed Swedish Skyways yesterday afternoon. Earlier this month, Kolomoisky pulled the plug on Danish carrier Cimber Sterling.

The two airlines were vital regional contractors for SAS, bringing passengers to Scandinavia's major airports, where the carrier would then take over and transport them onward.

Yesterday's bankruptcy left some 12,000 passengers ticketed for onward journeys with SAS with no way to make their connections.

Flemming Jensen, head of operations for SAS in Denmark, acknowledged that the Skyways closure left the airline in a tough spot.

“We need to be fed traffic from the smaller routes,” he told Jyllands-Posten newspaper. “We have already managed to fill some of the holes created by Cimber Sterling and we will soon also be flying some of the routes that Skyways operated.”

SAS is still looking for a partner to fly some of the routes it will be unable to take over.

“Our goal is to have the traffic resumed as quickly as possible,” Jensen told Jyllands-Posten.

Jacob Pedersen, a senior analyst at Sydbank, said the bankruptcies could significantly weaken SAS.

“They are lacking partners and can’t carry that type of traffic,” Pedersen told Jyllands-Posten. “On the other hand the diminishing capacity could also raise prices.”

Pedersen identified British airline FlyBe as a strong contender to move into the Scandinavian market and take over the routes.

“The gates have been left open for FlyBe Nordic, whose ambition is to become the largest regional player in the region. If the company has capital and can act quickly enough, FlyBe Nordic could quickly become a leading operator.”

The bankruptcy of Skyways was unexpected, as the airline had participated in the negotiations for the takeover of Cimber Sterling.

Kolomoisky’s is estimated to have lost 500 million kroner in his effort to create a large regional airline in Scandinavia that would operate routes too small for SAS to fly on.

Cimber Sterling and Skyways, however, did not turn out be good investments and required regular cash injections from the billionaire before he decided to cut his losses.

The cost of fuel accounts for up to 40 percent of the costs associated with running a fishing vessel (photo: iStock)
Danish government supporting fishing drone program
The Environment and Food Ministry is contributing 1.7 million kroner to a p...
Court: failings in delivery procedures (photo: iStock)
Danish fraud squad’s postal blunder costs prosecution stock manipulation case
An administrative mistake by the fraud office, Statsadvokaten for Særlig ...
It was a good day for Danish swimming (photo: Dansk Svømmeunion)
Denmark to host 2017 European Swimming Championships
The European Swimming Federation (LEN) has announced today at its congress ...
A general suicide prevention program and special campaigns focusing on girls and older men are at issue (photo: iStock)
Danish government proposes more cuts to suicide prevention
The government has been attracting criticism since announcing at the end of...
Drone explorations led to the discovery of the fortress last year (photo: Museum Sydøstdanmark)
Archaeologists to uncover secrets of Viking fortress
When archaeologists found the first Viking Age fortress in Denmark for 60 y...
The performance in question (photo: Chris Manion)
Danish Christian group’s use of burka in children’s performance was “racist” claims student magazine
The Danish Christian youth organisation Frivilligt Drenge- og Pige-Forbund ...