SAS defers A350 deliveries, narrows Q3 losses
Scandinavian airline SAS is deferring deliveries of two A350 aircraft by a year, it said as it reported narrower quarterly losses on September 1, 2021.
Two Airbus A350 aircraft that were due to be delivered in 2023 have now been pushed into 2024, chief financial officer Magnus Örnberg told analysts on a webcast.
“Ramp up expectations might be slightly delayed,” new chief executive Anko van der Werff said, adding the airline was seeing mixed signals in terms of vaccinations and travel restrictions.
The comments came as the carrier reported a pretax loss of SEK1.4 billion ($162 million) in its fiscal third quarter, an improvement on the loss of SEK2.1 billion ($243 million) recorded one year ago. It also recorded positive cash flow of SEK0.5 billion ($58 million) in the three months to July 31, 2021, the first time in 18 months.
Van der Werff, who took on the CEO role six weeks ago, said the Scandinavian airline needed to adapt to new travel trends and new competitors.
“We are expecting travel to increase gradually as more and more people are vaccinated worldwide, but we are also aware that demand has changed during the pandemic,” he commented in a press release. “SAS expects a greater number of leisure travelers and even more intense competition in the future.”
On the call with analysts, van der Werff said SAS was seeing an increase in bookings for business travel, more so among small and medium-sized companies, but that the extent of that increase was still uncertain.
He also said SAS, which traditionally caters more to business customers, needed to focus on cost cuts and adapting its offering to meet greater demand from leisure travelers.
“You do have a group of agile airlines out there who have core structures that enable them to take on business at this moment, more than what others are able to do,” van der Werff said.
The Scandinavian region is currently home to a plethora of new airlines, including Norse Atlantic, Flyr, and a revamped Norwegian.
“This is a new playing field out there. It’s a reality and that’s what it is,” the CEO added. “We have our defense walls but I want to make sure we get on the attack as well, fighting for passengers that were maybe not necessarily ours.”
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