FILE PHOTO: Scandinavian Airlines (SAS) Airbus A320 planes are parked at Copenhagen airport in Kastrup, Denmark, March 15, 2020. TT News Agency/Johan Nilsson via REUTERS
STOCKHOLM (Reuters) – Scandinavian airline SAS said on Tuesday it could reduce its workforce by up to 5,000 full-time positions due to plunging demand and travel restrictions during the coronavirus outbreak.
Airlines worldwide are cutting flights and costs due to the pandemic, and SAS said in a statement it expected limited activity during the key summer season.
The company said last month that it would temporarily lay off up to 10,000 employees, or 90% of the airline’s total workforce, as the coronavirus brought international travel to a near standstill in March, while domestic travel has also been severely impacted.
SAS CEO Rickard Gustafson said demand would probably be substantially lower this year and in 2021, while more normal levels could be reached in 2022.
“That’s the scenario we are working towards, and it’s the best estimate we can give,” he told Reuters.
Rival Norwegian Air has warned it could run out of cash by mid-May and last week said 4,700 staff would lose their jobs after four Swedish and Danish units filed for bankruptcy while U.S. and European staff contracts were cancelled. Norwegian is now seeking to convert debt to equity in a bid to qualify for state aid as it seeks to survive the crisis.
SAS, part-owned by Sweden and Denmark, added that the potential reduction of the workforce would be split with approximately 1,900 positions in Sweden, 1,300 in Norway and 1,700 in Denmark.
Reporting by Helena Soderpalm; editing by Niklas Pollard and Louise Heavens