SAS, the unions fail to reach an agreement; talks resume on Friday

  • SAS says strike threatens ability to arrange bridge financing
  • The costly strike will enter its 12th day on Friday

STOCKHOLM, July 15 (Reuters) – SAS (SAS.ST) and the pilots’ unions again failed on Thursday to agree on a deal to end a crippling strike that the airline said was threatening its ability to access bridge financing without which it could be forced to drastically reduce or could collapse.

SAS and unions were locked in talks throughout Thursday to end a strike among most of its pilots at the height of the holiday travel season, over terms tied to the Scandinavian carrier’s bailout. They abandoned talks shortly after midnight on Friday as the strike entered its 12th day, with talks expected to resume later on Friday.

“There are a number of important issues for both sides that need to be resolved in order to reach an agreement,” mediator Mats Ruland told E24.

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Earlier Thursday, SAS, whose main owners are the Swedish and Danish governments, said the strike threatened the company’s ability to raise much-needed capital to fund its reorganization.

“In such an event, the company will have to consider selling valuable strategic assets under duress while drastically reducing SAS’s operations and fleet,” SAS said in a statement.

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

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

SAS flights listed at Copenhagen Airport, July 3, 2022. REUTERS / Andrew Kelly

SAS said the strike had so far caused 2,550 flight cancellations, affecting 270,000 passengers, and cost it between $94 million and $123 million. He warned that his limited cash reserves would quickly erode if the strike continued.

Long-struggling SAS, which needs to cut costs and attract new investors to survive, filed for bankruptcy protection in the United States on July 5.

“The strike puts the success of the Chapter 11 process and ultimately the survival of the company on the line,” CEO Anko van der Werff said Thursday.

Pilots employed by SAS Scandinavia, a subsidiary of SAS Group, said they would accept limited pay cuts and less favorable conditions, but SAS said the concessions so far were not enough for it to implement 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 candidates for jobs on less attractive terms at the newly created SAS Link and Ireland-based SAS Connect. .

Danish mechanics, who had gone on strike in sympathy with the pilots, said on Thursday they were ending their action, meaning SAS planes in Copenhagen would be serviced and could be back in the air quickly once an agreement with the pilots would be concluded.

The Swedish mechanics did not go on strike. The pilots employed by SAS Connect and SAS Link are also not on strike.

($1 = 10.6095 Swedish crowns)

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Reporting by Helena Soderpalm, Anna Ringstrom, Johan Ahlander and Stine Jacobsen; Written by Anna Ringstrom; edited by Edmund Blair, Jason Neely, David Evans and Leslie Adler

Our standards: The Thomson Reuters Trust Principles.

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