Thousands Stranded As SAS Strike Continues In Its Fifth Day

As the SAS pilots strike continues into a fifth day, the number of passengers affected has increased past the quarter of a million mark. With no resolution to the conflict in sight, how long will this SAS strike take?

It was last Friday when more than 1,400 pilots walked out on SAS. Pilots from Sweden, Denmark and Norway refused to work anymore until SAS improved their working conditions and salaries.

At least 70% of flights have had to be cancelled as a result.

With an estimated 280,000 passengers affected, SAS could be looking at a large bill for compensation, on top of the loss of revenue as a result of the strike.

Under EU regulations, all passengers are entitled to a €600 compensation payment if their flights are delayed for more than three hours.

However, SAS have said they will reject these claims, citing extraordinary circumstances as a reason not to pay. SAS’s information manager Morten Johansen said:

Passengers are not entitled to compensation when the delay is caused by a strike, as that is considered an extraordinary circumstance that is outside the airline’s actual control.

However, it’s unlikely that this stance will be challenged going on previous outcomes of strikes.

When Ryanair refused to pay compensation following strike action, the Civil Aviation Authority (CAA) said that the airline must settle these claims and are taking the Irish carrier to court to make them pay.

The short answer is not any time soon. Even the mediators are losing hope of a resolution.

Mediator Jan Sjölin on Tuesday morning said: We are in constant contact with the parties, but there are no negotiations scheduled today. Things can of course change quickly, but at the moment nothing is booked in,

The parties remain fixed in their positions. It makes no sense to meet and repeat the same things all over again. We are on standby to get to work again whenever, but things have to change from what they were when talks broke down.

Apparently, it’s not that SAS aren’t keen to talk. It is, after all, in their best interests to get things moving as soon as possible.

Their CEO, Richard Gustafson said that both he and SAS have been creative in trying to resolve the situation.

We have made attractive offers that they have turned down. We’ll have to see what else we can do, he said.

However, the Swedish Pilots’ Association doesn’t think they’re doing enough. Rawaz Nermany, chairman of the Association, is quoted as saying:

The way forward is that SAS shows a genuine will to sit down and negotiate. If they do that, I am convinced that we can resolve this. I think SAS has to take responsibility,”

The Association is demanding a 13% pay raise for pilots, as well as better working hours and more predictable shift patterns. SAS are offering a 2.3% pay rise, but the union has apparently said that it’s more about the working conditions than the pay.

So, it seems that negotiations have reached a deadlock. With even the mediators lacking hope for a swift resolution, it looks like the strike action could go on a lot longer than initially thought.

Since the strike started late last week, it is estimated to have led to almost 3,000 cancellation, disrupting the travel plans of more than 280,000 passengers.

SAS said that the action by its pilots is having a very negative effect on our customers and our business.

DnB Markets lowered their rating on SAS shares as the strike entered the fifth day. Their analysts have halved their 2019 earnings per share estimate since the start of the strike. They’ve also warned that these may be cut further if the issue is not resolved by Wednesday.

Estimates are that the strike is costing SAS as much as 100 million Swedish Crowns ($10.5m) each day it drags on. Share prices have dropped by over 9% since before the strike.

The airline had previously targeted a 3bn Crown cost saving by 2020 in the face of rising fuel prices and stiff competition, but that target is looking increasingly unattainable in light of the current situation.


Tourism Observer

UNITED KINGDOM: Scandinavian Airlines (SAS) Is Most Compliant Airline At Heathrow Airport

London’s main gateway, Heathrow Airport (LHR) has unveiled its quarterly list featuring the top 50 noisiest, nastiest, most polluting airlines that fly into the busy airport.

The world’s seventh busiest airport, which registered the 78 million passenger mark in 2017, publishes this list on a quarterly basis, depicting those airlines that like behave, and those that don’t.

During the first quarter of 2018, EgyptAir hits the bottom of the list as the worst airline in the - noise quota count per seat measure.

This section measures the amount of noise a plane makes in relation to the number of passengers it carries.

The Egyptian carrier also scored the last spot, becoming the noisiest, and the one with most violations.

According to LHR, the Cairo-based airline flew routes, and that were less compliant with the noise abatement regulations around the airport.

The airline currently operates four flights per day to Cairo, departing at 13:30, 15:00, 21:05, and 22:35.

London-Heathrow has received thousands of complaints over the last decade because of the noise arriving and departing aircraft produce when operating in/out of the airport.

For this reason, there are pre-established arriving and departing noise preferred routes that airlines must comply with.

EgyptAir’s poor ranking is commensurate with its current flight schedule. The airline often runs delayed between the 23:30 and 04:30 curfew.

Scandinavian Airlines (SAS) scored the first spot as the most compliant airline of all.

Out of a possible score of 1,000 points, SAS landed at 944.

In the second place, LOT Polish Airlines follows with 938. Aer Lingus, Etihad Airways, Flybe, British Airways, Finnair, Delta, United, and Iberia complete the top-10.

During the same period in 2017, British Airways came up in the first spot, followed by Aer Lingus.

Etihad managed to keep the third spot for its second consecutive year.

As far as the local airlines are concerned, Virgin Atlantic keeps the 17th spot, scoring a modest 855 points.

The airline scored the 6th spot in noise quota per seat but dropped to the 36th spot in track keeping violations.

Flybe, however, was the number-one in noise certification, engine emissions certification, and early movements between 23:30 and 04:30.

British Airways (BA) long haul made the 22nd spot with an 824 mark.

The airline reached the second place in noise quota and emissions per seat. However, it fell to the last spot in engine emissions certification.

In the short haul segment, BA remains within the Top 10, scoring 935 points. The airline made the number-one position in noise quota and emissions per seat mark.

Overall, it’s a positive result for the British carriers, scoring decent points and remaining in acceptable positions against its competitors.

The middle of the table finds some interesting airlines.

In the 20th spot, Air India marked an 840 score, followed by Cathay Pacific, Aegean Airlines, Swiss, Qatar Airways, Air France, South African, Eurowings, Singapore, and Thai Airways.

Two of the Middle East Big Three carriers are outside the Top-10. Qatar Airways made the 29th spot in track keeping violations and 35th in continuous descent approach violations.

Emirates, on the other hand, made the 11th overall spot with 881 points.

The Dubai-based giant sometimes brings up to six Airbus A380s per day into LHR—one of the most silent aircraft in the industry.

However, it made the 16th spot in noise quota per seat, mainly because some of its flights operate between late night or early morning hours.

The worst 10 airlines, other than EgyptAir, are Kuwait Airways (49), Turkish Airlines [short haul] (48), El Al (47), Pakistan International Airlines (46), Turkish Airlines [long haul] (45), Korean Air (44), DHL (43), China Southern (42), Air China (41), and Gulf Air (40) complete the list.

Last year, El Al occupied the last spot, scoring 362 points.

This year, however, the Tel Aviv-based carrier scored 528, occupying the 47th place—a three-spot improvement.

In January, LHR announced that environmental charges over airlines increased 7%, starting from January 1, 2018.

The airport expects to reduce the impact on local communities by making it cleaner and quieter with the restructured environmental charge, encouraging airlines to deploy its newest aircraft on LHR-bound routes.

This is the best way to cut emissions and shrink the noise footprint around the airport.

It is a tangible step that will make a real difference to local communities, said John Holland-Kaye, Heathrow CEO.

The new environmental charge forms part of Heathrow’s sustainability strategy called Heathrow 2.0. The airport’s goal is to reach at least a 50% of its passengers to travel in “sustainable transport” by 2030.

This quarterly list is, therefore, a clever way of showing which airlines comply with the airport’s regulations.

By 2025, Heathrow 2.0, will establish an airside ultra-low emission zone, to improve quality of life of local communities through cleaner air.

Heathrow has also been recognized as the Best Airport in Western Europe and for the 9th year in a row, Best Airport for Shopping.

This achievement follows what has been a successful year for the airport, carrying 78 million passengers annually.

The 82% of passengers surveyed in 2017 rated their experience traveling through Heathrow as Excellent or Very Good.

On top of this, Heathrow recorded a personal best in improving flight punctuality with 80.2% of flights departing within 15 minutes of their scheduled departures.


Tourism Observer

NORWAY: SAS Faces Norwegian Pilot Strike Inspite Of Agreement

Pilots working for Scandinavian Airlines (SAS) in Norway have rejected a pay offer and called for strike action, just days after the airline sealed an agreement with its Danish flight-deck crews.

SAS was facing a strike among its Danish crews, represented by the DPF union, but the planned walkout on Sept. 11 was called off after the two sides reached a three-year agreement.

However, SAS is now facing another strike threat from the Norwegian Pilot Association (NSF), which could see action from Sept. 14.

The airline said the Norwegian pilots have been offered similar conditions to their Swedish and Danish counterparts, but the proposal has been rejected.

SAS operates in a highly competitive market. We need to be able to adapt the company to the market conditions and fly when passengers want to fly.

The Norwegian pilot unions have rejected the proposal, which unfortunately has resulted in a conflict.

In the negotiations with the Norwegian pilot unions the Norwegian pilots have been offered conditions in line with the Swedish and Danish pilots, although the opposite message have been communicated from the Norwegian Pilot Association NSF.

The demands from the Norwegian pilots, which imply cost increases of 25%, are unreasonable.

We have agreed with all other employee groups within SAS, including the pilots in Denmark and Sweden, with the ambition to create a sustainable SAS for the future.

Only the Norwegian pilots remain.

We are very sorry that the pilot unions in Norway have chosen to start this conflict and we are still convinced that we will find a solution before Thursday, when the Norwegian pilot unions have given notice regarding an extended strike, which will affect the passengers and the trust in the company.



Tourism Observer

TANZANIA: Etihad Airways Flights To Dar es Salaam

Etihad Airways, the flag carrier and the second-largest airline of the United Arab Emirates, launched its daily flights to Tanzania on Tuesday, adding to the list a growing of Middle East carriers eyeing Tanzanian and African airspace.

Etihad Airways touched down at the Julius Nyerere International Airport (DAR) in Dar es Salaam on Tuesday and the Airbus A320 aircraft received a ceremonial water cannon salute. It will be operating daily nonstop flights connecting the business city of Abu Dhabi in United Arab Emirates (UAE) with Dar es Salaam.

The daily flights will be operated with Airbus A320 aircraft and set to attract more passengers from Tanzania and its neighbouring states. Etihad Airways joins the list of a growing number of Middle East registered airlines lobbying East African skies.

Dar es Salaam will be Etihad Airways’ 110th destination globally and its 11th destination in Africa and the Indian Ocean, reports from the airline’s head office in Abu Dhabi said. The flights will be connecting the Tanzanian capital with 45 destinations across the Middle East, Europe, the Indian Subcontinent, North and Southern Asia and Australia through daily flights, the Etihad report said.

Taking advantage of the fast-growing air connection between East Africa and the Middle East, Tanzania is lobbying tourists and travel trade investments from the Gulf States and the rest of the Arab World.

A team of tourist business stakeholders and marketing officials from Tanzania visited Dubai and other Middle East states last year, looking for potential tourists and investors in tourism from the Gulf States and invited them to invest in Tanzania’s fast-growing tourist industry, taking advantage of the Middle East airlines new routes.

Tanzania Tourist Board had launched marketing campaigns to attract visitors from the Gulf States through these airlines. Hotel and accommodations, hunting and camping safaris are areas of tourist investment and the Tanzania Tourist Board is looking to market them in the Gulf States.

Although the number of Arab tourists to East Africa is not as big as the European and American holidaymakers, there has been a notable number of hunting tourists from the Middle East to Tanzania and the rest of East Africa. About 15,000 tourists from the Gulf visit East Africa every year.

Although small in numbers, East African nations are taking advantage of the Middle East-registered airlines to be a lifeline for Arab-speaking holidaymakers. Airlines registered in Middle Eastern states that are flying to Tanzania include Emirates Airlines, Qatar Airways, Oman Air, Turkish Airlines and Fly Dubai, which are the most competitive over Tanzania’s airspace.

Middle East-registered airlines have taken over the Tanzanian airspace from the traditional European-based airlines which had pulled out their flights between key European cities and Dar es Salaam.

Among European carriers that pulled their flights out of Tanzania are SAS (Scandinavian), Sabena, Air France, Lufthansa, Aeroflot (Russia), Alitalia and British Airways.

USA: Craft Beer Flying On Flights

This year, Delta Air Lines began offering a range of seven US regional craft beers on US domestic flights. - See more at: http://apex.aero/2015/12/01/craft-beer-takes-flight-brewing-revolution#sthash.GzMwnzDf.dpuf

The microbrewery revolution is taking hold in the skies, as airlines add craft beers to in-flight menus. Delta offers craft ales haling from some of the cities it flies to, while SAS partnered with a Copenhagen-based brewery to produce a mango-infused sweet and sour beer inspired by Cantonese cuisine. By offering unique microbrews, airlines aim to differentiate their brand and attract high-paying craft beer-drinking customers.

Among the uninformed, American beer was the butt of many a joke. Not anymore. In recent years, thousands of craft beer pubs have popped up across the US, serving everything from hoppy IPAs to toasted oat coffee stouts. The bland lagers haven’t disappeared, but America’s artisan beer makers have been brewing up a hoppy revolution that’s not only taken hold on the ground, but up in the skies too.

The trend caught the attention of airlines such as Delta Air Lines, who this year began offering a range of seven US regional craft beers on US domestic flights, each originating in one of its destinations. On the airline’s flights from New York to west coast cities, passengers can sample a range of standout brews such as “Sculpin India Pale Ale,” a gold medal-winning beer with notes of lemon, mango and peach, from San Diego-based brewers Ballast Point.

Other US carriers serve in-flight brews originating from their home territory, as a way to forge a sense of local identity with their home cities. Alaska Airlines for example, partners with the Alaskan Brewing Company to serve its American Pale Ale and Amber Ales during in-flight service, with Porter, JetBlue and Virgin America also offering beers from their respective hub cities.

Industry growth and expanded capacity mean more brewers are now able to offer their product in the safe and stackable can sizes preferred for in-flight catering.

The move towards airlines offering craft ales on board makes business sense too. It turns out the people drinking craft are the same ones flying regularly – those with full time jobs, university education and earning higher incomes. Offering unique microbrewery beers can attract high-paying passengers and works to differentiate an airline’s brand.

Scandinavian Airlines (SAS) is another airline to adopt this approach, partnering with Mikkeler, a Copenhagen-based microbrewery. The Danish craft beer company has produced four exclusive beers for the Scandinavian airline, their latest incarnation is a sweet and sour Belgian ale, fermented in mango juice for business class passengers on board its flights to and from Hong Kong – something SAS markets as a unique selling point to promote the non-stop route.

Until recently, the majority of craft beers were packaged exclusively in bottles, uneconomical for airlines looking to save weight wherever possible. But industry growth and expanded capacity mean more brewers are now able to offer their product in the safe and stackable can sizes preferred for in-flight catering.

Although the microbrewery industry boom doesn’t look to be over anytime soon, it could be a while longer before craft beer is commonly served on board long-haul flights. Artisanal ales are often more expensive to brew and trickier to produce in quantities demanded on board international routes, which rely on serving mainstream lager brands.

Nonetheless, there’s never been a wider choice of brews available for the discerning beer drinking flyer.

SWEDEN: SAS Starts Stansted Service

SAS commenced services between Gothenburg and London Stansted on 26 October.

The 999-kilometre sector will be operated by the Star Alliance member’s 737-600s on a daily basis and replaces the airline’s operations between the Swedish city and London Heathrow.

SAS commenced services from Gothenburg (GOT) to London Stansted (STN) and Brussels (BRU) on 26 October. The 999-kilometre service to London’s third busiest airport will operate daily while services on the 903-kilometre link to the Belgian capital will operate six times weekly.

Both routes will be flown by the Star Alliance member’s 737-600s and both will also face direct competition. Stansted services will compete against Ryanair which operates 18 weekly flights while Brussels Airlines is the incumbent carrier on services to Brussels, with it also operating 18 weekly flights.

However, services to Belgium are in partnership as both SAS and Brussels Airlines are part of Star Alliance.

SWEDEN: Scandinavian Airlines Targets Long-haul Growth In 2016

SAS is planning several new long-haul services to the US in 2016 but its most recent long-haul route launch was from Stockholm Arlanda to Hong Kong, which began operating on 10 September. The 8,203-kilometre route, operated by the airline’s wide-body fleet has helped to increase the ASKs offered by SAS out of Stockholm this winter by up to 20%.

Operating on the far north of Europe, and obliged for political reasons to operate three separate hubs within 600 kilometres of each other, SAS is by most measures one of Europe’s top 10 airlines, carrying over 27 million passengers in 2014. However, the Star Alliance carrier has struggled financially in recent years and came very close to collapse in late 2012. Since then things have improved, thanks to a major cost-cutting programme and the fortuitous fall in the price of fuel, so much so that the carrier has even reported a positive 3% operating margin for its most recent 12-month accounting period (to July 2015).

As the national carrier for all three Scandinavian countries (Denmark, Norway and Sweden) SAS’ three biggest bases are also the capital cities of those countries. The next busiest airports (Bergen and Stavanger) are both in Norway, helping to make it the airline’s leading country market for weekly seat capacity, ahead of Denmark, Sweden, UK, Germany and Spain. The leading non-Scandinavian airports (shown in bright green) are led by London Heathrow in sixth place.

Capacity changes at the airline’s top dozen airports has been within plus or minus 5% with the exception of Trondheim (down 9%), Stockholm Arlanda (up nearly 7%), and Gothenburg (up almost 20%). SAS’ growth in Gothenburg may be related to the benefits of competition from Ryanair which has moved to the bigger airport, and upgraded it to a designated base, following the closure of the city’s downtown airport to commercial services. Dublin features among SAS’ recent route launches…definitely a challenge to Ryanair!

Stockholm growing, Copenhagen and Oslo stagnate in 2015

Analysis of monthly ASKs (Available Seat Kilometres) at the airline’s three main bases shows that on the whole the airline has continued to add capacity to its network. In 2015, Stockholm has seen an 8% increase in its annual ASKs compared with 2014, while both Copenhagen and Oslo have seen very small reductions. In 2014 the opposite had been true, with Copenhagen and Oslo both growing faster than Stockholm.

What this graph fails to illustrate is the increase in routes offered by SAS from its main bases. According to anna.aero analysis of OAG schedule data between August 2011 and August 2015, SAS grew the number of airports served from 87 to 109, while increasing the number of routes flown from around 150 to over 230. SAS’ most recent quarterly presentation highlights this in a different way, pointing out that between July 2011 and July 2015 the airline increased the number of international routes (to outside Scandinavia) by 62%, from 112 to 181. Across the same period aircraft utilisation improved by 29%.

Stockholm’s sudden ASK growth towards the end of 2015 can partly be explained by the launch in September of a new long-haul, wide-body service to Hong Kong using the airline’s latest A330s.

Distinct seasonality profile

While most European airlines and airports see a peak in demand during the main summer months of July and August, the Scandinavian market is somewhat different. With a typically higher proportion of business traffic during most of the year, demand actually falls away during the summer holiday period of July and August even though that is typically when Scandinavians (like their Northern European colleagues in the UK and Germany) head south for guaranteed sunshine.

Dealing with seasonality is a major issue faced by most airlines and applying anna.aero’s SVID (Seasonal Variation in Demand) formula, which we normally apply to airports, to SAS’ monthly seat capacity for the last two years reveals that the carrier has managed to reduce seasonality at its Copenhagen and Oslo bases, but not in Stockholm.

US expansion driven by Norwegian threat?

Long-haul flying is set to grow in 2016 with the commencement of a new daily Stockholm to Los Angeles service starting in March, followed by new services to Miami from both Copenhagen and Oslo starting in autumn 2016. In addition there are increased frequencies this winter on routes to Chicago, New York, San Francisco and Shanghai. However, the service operated on the airline’s behalf by Privatair between the oil cities of Stavanger and Houston, will end in a couple of weeks at the end of the summer season. Instead the 737-700 will be re-configured from a 44-seat all-business class layout to a two-class 86-seat layout (with 20 business class seats and 66 economy seats) and will be used to start a new daily service between Copenhagen and Boston from the end of March 2016. Coincidentally, or not, this is a route that Norwegian plans to start operating with its 787-8s next May. Between the end of October and next March the aircraft will be used to provide some of the capacity on SAS’s existing Copenhagen-Newark service.

Over 90 new routes launched since 2011

Analysing OAG schedule data for the first week of August in both 2011 and 2015 reveals that SAS operates over 90 routes this summer that it did not four years ago. However, it has also dropped around a dozen routes that it did serve in August 2011, including four routes to Madrid, Bergen to London Gatwick and Copenhagen services to Lyon. Some of these new services operate at low frequency for just a few weeks during the peaks summer holiday season.

Airport Route (code)
Copenhagen (CPH) Alicante (ALC), Ankara (ESB), Biarritz (BIQ), Billund (BLL), Budapest (BUD), Chania (CHQ), Dubrovnik (DBV), Edinburgh (EDI), Gazipasa (GZP), Linkoping (LPI), Malaga (AGP), Montpellier (MPL), Naples (NAP), Newcastle (NCL), Palermo (PMO), Palma de Mallorca (PMI), Pisa (PSA), Prague (PRG), Pula (PUY), San Francisco (SFO), Shanghai (PVG), Split (SPU), Tel Aviv (TLV), Thessaloniki (SKG), Trondheim (TRD), Wroclaw (WRO)

Oslo (OSL) Aberdeen (ABZ), Athens (ATH), Berlin (TXL), Billund (BLL), Chania (CHQ), Edinburgh (EDI), Gazipasa (GZP), Pisa (PSA), Pristina (PRN), Pula (PUY), Salzburg (SZG), Santorini (JTR)

Stockholm (ARN) Aalborg (AAL), Alicante (ALC), Ankara (ESB), Barcelona (BCN), Berlin (TXL), Biarritz (BIQ), Billund (BLL), Bodo (BOO), Bologna (BLQ), Bristol (BRS), Cagliari (CAG), Chania (CHQ), Dubrovnik (DBV), Faro (FAO), Gazipasa (GZP), Hamburg (HAM), Kalmar (KLR), Malaga (AGP), Milan Malpensa (MXP), Olbia (OLB), Palermo (PMO), Prague (PRG), Pristina (PRN), Pisa (PSA), Pula (PUY), Riga (RIX), Tampere (TMP), Thessaloniki (SKG), Turku (TKU), Vaasa (VAA), Vilnius (VNO)

Gothenburg (GOT) Alicante (ALC), Athens (ATH), Berlin (TXL), Dublin (DUB), Gazipasa (GZP), Malaga (AGP), Nice (NCE), Palma de Mallorca (PMI), Pristina (PRN), Pula (PUY)

Bergen (BGO) Barcelona (BCN), Gazipasa (GZP), Malaga (AGP), Split (SPU)

Trondheim (TRD) Copenhagen (CPH), Malaga (AGP), Stavanger (SVG)

Stavanger (SVG) Barcelona (BCN), Gazipasa (GZP), Split (SPU), Trondheim (TRD)

Billund (BLL) Copenhagen (CPH), Gazipasa (GZP), Oslo (OSL), Stockholm (ARN)

Further route expansion for this winter includes the launch of Brussels and Paris CDG flights from Gothenburg, plus the re-allocation of Gothenburg-London Heathrow flights to London Stansted. There will also be a new service from Oslo to Vilnius. Apart from the new long-haul services previously mentioned, next summer will see the addition of new services from Stockholm to Munich and from Copenhagen to Faro, Krakow, Reykjavik/Keflavik and Vienna.