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.