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Saturday, July 20, 2024

Norway cool to bailing out SAS

Norway’s government minister in charge of business and trade doesn’t seem inclined to infuse Scandinavian Airlines (SAS) with more capital, after the airline reported more heavy losses this week.

Norwegian Trade Minister Trond Giske called SAS’ financial situation “worrisome,” but he’s more interested in selling off Norway’s stake in SAS than boosting it. “I have authority from the parliament to sell, given we find a good buyer and a good solution that can take care of the values in the company and the jobs it provides, at a good price,” Giske told newspaper Dagens Næringsliv (DN).

Norwegian government officials joined their counterparts in Sweden and Denmark in providing new capital for SAS in both 2009 and 2010. Norway bought new shares valued at NOK 1.3 billion. Now Norway’s stake in SAS is worth an estimated NOK 300 million.

SAS reported a first-quarter loss of SEK 1.13 billion on Wednesday, nearly double its loss of SEK 558 million in the same quarter last year. The airline that calls itself “full-service” continues to struggle against competition from cut-rate carriers and also has been hit with high fuel costs and “other costs” in a “tough market.”

SAS’ domestic carrier in Norway, Widerøe, reported a profit, however, of NOK 54 million in the first quarter but reported that it’s feeling competitive pressure from rival Norwegian Air.

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