SAS Airline To Temporarily Lay Off 90% Of Workforce, Essentially Suspends Operations

Scandinavian airline SAS AB said on Sunday it will temporarily lay off up to 10,000 employees, or 90% of its workforce, as the coronavirus epidemic and international travel bans have crushed its demand.

The reductions, SAS noted, will be “implemented through all parts of the operation,” according to national regulations.

“It is important to say that we do not intend this to lead to permanent layoffs,” said chief executive officer Rickard Gustafson.

SAS, which is partly owned by Sweden and Denmark, also announced that starting on Monday it will halt most of its services “until there are yet again conditions to conduct commercial aviation.”

To support customers, the airline added, “we will in the next few days do our utmost to uphold a certain level of operation to enable travelers to return from their destinations.”

SAS added: “We will be at the disposal of the authorities to, on their behalf, take home stranded citizens or maintain infrastructure important to society, as far as possible.”

On Friday, the Danish government closed its borders. Norway closed its borders on Monday.

On Saturday Sweden’s foreign ministry advised that citizens should avoid nonessential travel through at least April 14.

“While we’ve seen plenty of airlines cut capacity, SAS has taken a different approach than other airlines,” wrote Ben Schlappig, a travel consultant. “They’re acknowledging demand is virtually nonexistent and are basically saying they’re shutting down until there’s demand again, rather than giving a period of only a week or two, when surely that would be pushed back.”

Schlappig added: “It sounds like we can still expect a few flights in the next few days, but that’s about it. Interestingly I still see inventory loaded for most flights, so it looks like the airline hasn’t fully started the process of canceling flights and pulling inventory.”

Last week, SAS asked its unions to take a 20% cut in pay and work hours. The company’s management had already agreed to slash their own salaries by 20% while continuing to work full time.

Finnair, the largest airline of Finland, said Monday it will reduce capacity by 90% starting Apr. 1 – adding these reductions will remain “until the situation improves”.

“Finnair will temporarily operate only approximately 20 routes, ensuring certain critical air and cargo supply connections for Finland during this exceptional situation,” the carrier stated.

Finnair noted it will cancel between 1,500 to 2,000 flights from Mar. 16 to Mar. 31.

“The coronavirus epidemic has decreased air travel dramatically, but we want to maintain the most critical air connections for Finland also in this exceptional situation,” said Topi Manner, Finnair’s CEO. “We continue to follow the situation closely, adding routes and frequencies to the traffic program as demand returns. We hope to be able to return to normal operations as soon as the coronavirus situation alleviates. We are extremely sorry about the disruption and uncertainty the situation is causing to our customers and their travel plans. In this situation, the capacity cuts are unavoidable – we cannot fly customers in a situation where we may not be able to fly them back home.”

Chris Loh of SimpleFlying.com expects to see more similar moves by airlines.

“We anticipate that this situation will only get worse in the short-term as countries close off their borders in a concerted effort to contain the coronavirus pandemic and prevent their respective health care systems from being completely overrun,” he wrote.