The Gulf Time Newspaper One of the finest business newspapers in the UAE brought to you by our professional writers and editors.
Bloomberg
SAS AB cancelled an additional 587 flights across Scandinavia scheduled for Sunday because of a strike by pilots, disrupting travel for an estimated 64,000 passengers, the company said in a statement on Saturday.
The pilots are striking over pay, having started the action after rejecting measures proposed by a mediator in talks that have been going on since March.
Sydbank analyst Jacob Pedersen lowered the stock recommendation to hold from buy. In a note, he said that the strike is a surprise, showing that SAS is more vulnerable than the bank had thought. Sydbank also estimated that the strike could cost SAS 60 million kronor to 80 million kronor ($6.32 million to $8.42 million) per day, potentially denting SAS’s full-year profit if the strike were to continue for about 14 days.
The walkout underlines the pressure facing network airlines such as SAS as they seek to bring down costs amid competition from discount rivals and Europe-wide overcapacity that’s weighing on fares.
SAS said that it is doing all it can to help passengers, and seeks to reach a solution as soon as possible.
The strike will not affect flights operated by SAS’s partners, which account for 30 percent of all departures, the airline said.