Tue, 14 Jul 2020

STOCKHOLM, May 28 (Xinhua) -- Further proof that the COVID-19 pandemic has had a devastating impact on the airlines industry came on Thursday as Scandinavian Airlines (SAS) recorded a loss of just over 3.7 billion SEK (389 million U.S. dollars) in the first quarter of 2020.

The airline ran at a loss in the first quarter of last year as well, but the loss then amounted to 1.216 billion SEK.

SAS has had to ground a majority of flights since the COVID-19 outbreak and has begun significantly to reduce its workforce, doing away with up to 5,000 full-time positions, Swedish Television reported on Thursday.

In a further bid to rescue the company, there are now also efforts to raise additional funds from the major shareholders, including the Danish and Swedish states and the Wallenbergs, a Swedish business family.

SAS CEO Rickard Gustafson told Swedish news agency TT that the company has coped relatively well, considering the circumstances, and has managed to boost its coffers. "But," he said, "if we are to survive and create a long-term functioning business, then we must not only get access to loans but also to restore our balance sheet. We will not manage to do so without support from our major owners."

Previously, both the Swedish and Danish states have guaranteed emergency loans worth 3.3 billion SEK. According to Gustafson there are now "intense and constructive" discussions about injecting additional cash. The airline is also trying to convince the Norwegian state to offer support in the form of a credit facility.

In a sign that things are slowly picking up for the airlines industry, earlier this week several European airlines, including SAS, announced that some routes are to resume in June. SAS has reduced its fleet to just 15 airplanes but now plans to double that number, with routes operating to and from Copenhagen, Amsterdam, New York and Chicago, along with other destinations. (1 U.S. dollar = 9.6 SEK)

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