SAS – from luxury to turbulence
The airline SAS (Scandinavian Airlines System) was established in 1946 as a collaboration between the national airlines of the three Scandinavian countries. The intention at the time was a collaboration on long-haul flights to and from Scandinavia.
The very first route was to New York. During 1947, a route was also established to Rio de Janeiro and Montevideo, which was later also extended to Buenos Aires.
In the years that followed this, SAS expanded the route network considerably, and eventually had flights to almost the whole world.
The 50s: Expensive and for the few
In the 1950s, SAS invested heavily in its intercontinental routes. SAS was the first airline to be licensed to fly over the North Pole between Europe and North America. This shortened the journey time considerably, and then the company gained a big competitive advantage.
– SAS was a pioneering company in several areas, says manager of the SAS Museum, Thore Erik Winderen, to NTB.
If you traveled from Stockholm to New York in 1954, you could experience a «Royal Viking de Luxe», if you could pay for it. This included a buffet, French wines and a three-course menu. Flying at that time was expensive, and it was not an offer that the “everyman” took advantage of.
Nevertheless, offering reasonable tickets was one of the things that made SAS pioneers, says Winderen.
– Among other things, we were the first to launch an economy class across the Atlantic in 1952. We were also the only ones to start up commercial flights over the polar region to Los Angeles on November 15, 1954, and over the North Pole to Tokyo on February 24, 1957, he says.
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The 60s and 70s: Mass tourism
SAS received the Columbus Award for these routes over the polar region on 12 October 1962.
– These routes saved many hours in flight time. SAS was alone on these routes for several years before other companies followed suit. This was a pioneering effort in polar navigation, says Winderen.
In 1959, SAS bought its first jet. They were the first airline to put Caravelle jets into regular traffic, on the route between Copenhagen and Beirut, and this was to mark the 60s. The following year, jet aircraft were used on the company’s long-haul routes, when SAS went to purchase the aircraft type Douglas DC-8. These are airliners as we know them today, and could carry many passengers.
In the 60s it was still very nice to fly, and even in tourist class you could expect good wine and food served on china from a proper three-course menu.
In 1965, SAS became the first airline to use an electronic booking system that covered the whole of Europe. In 1971, SAS received its first Boeing 747 jumbo jet. These were large planes that could carry a lot of passengers, and that’s when mass tourism really took off.
The 80s: SAS’s golden age
In 1982, SAS was Europe’s most punctual airline for the first time, and the following year, in 1983, SAS was awarded “Airline of the Year”. This happened at the same time as business class was introduced on all routes.
– A period «everyone» talks about the period of the 80s and early 90s. There was a lot of pride among the employees, we were included and could make our own decisions, says Winderen.
All the SAS planes got new decorations and the staff got new uniforms. SAS became “the businessman’s airline”, says Winderen. In 1987, SAS was awarded the distinction «best passenger service» by the magazine Air Transport World. In 1989, 1st class disappeared on the intercontinental network.
Even though more and more planes, it still turned out that SAS was unable to fill up the Boeing 747 jumbo jets so that they became profitable to have in operation. During the 1980s, SAS signed for all its aircraft of this type.
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The 90s: A changed industry
Until the 1990s, SAS shared the air mainly with another company, namely Braathens. The two companies had a monopoly on its domestic routes. The international routes, on the other hand, were handled by SAS alone, but this changed towards 2000.
The airline industry was changed for good by deregulation and increased competition.
– Deregulation ruined a lot for many airlines, including SAS. It first started in the US and then came to Europe. The customer has received much cheaper travel, but it has cost, says Winderen.
From 1993, SAS leased to Braathens. In 1994, the duopoly on Norwegian domestic routes ended. In 1996, SAS bought into Widerøe, and became sole owner from 2002.
In 1997, SAS helped to establish the first global airline alliance «Star Alliance» together with Lufthansa, United Airlines, Air Canada and Thai Airways.
The 00s: The low-cost companies are coming
On 6 July 2001, SAS was reorganized into a parent company, which was listed on the stock exchanges in Stockholm, Copenhagen and Oslo. The terrorist attacks on 11 September 2001 led to a sharp decline in the number of air passengers worldwide, and in the same year a weakened SAS also had to downsize.
The acquisition of Braathens in 2002 created a vacuum in the market, and in 2003 Norwegian decided to start its own domestic routes as a low-cost airline.
In order to meet the competition from the low-cost airlines, SAS had to take several measures. They cut the catering offer on board, cut their own ticket prices and in 2003 established the low-cost concept Snowflake to compete with EasyJet and Ryanair.
Snowflake quickly proved to be unsustainable and was discontinued after only one year. The financial crisis in 2008 led to reorganization in SAS, and the national companies were merged into a Scandinavian entity in 2009.
The 2010s: Strikes and competition
Despite cuts and restructuring, SAS struggled with negative results throughout the 2000s. This led to several savings plans and strategies to cut costs and rig for the future. Among them were «4EXELLENCE» in 2011, and «4EXELLENCE Next Generation» in 2013.
The cut plans involved, among other things, salary cuts for the employees, longer working hours and further downsizing. Throughout the decade there were several strikes, both in 2010, 2015, 2016, 2017 and 2019 – in addition to the strike in 2022, according to Faktisk.no.
In 2016, the Swedish and Norwegian state sold down to 17.1 and 11.4 percent respectively. In 2018, the Norwegian state sold the rest of the shares in the company, with the exception of Oljefondet’s shares of approximately 1 percent ownership.
SAS was hit hard by the corona pandemic in 2020, and had to borrow money from both the Danish and Swedish states, in addition to DKK 1.5 billion with a state guarantee from the Norwegian state. On 28 June, the government refused to contribute more money to SAS, but said they were willing to convert the loan into shares under given conditions.
2020: the corona pandemic
During the pandemic, SAS had to lay off around 5,000 employees, of which around 500 were pilots. When these were to get their jobs back, problems started which formed recordings for the strike which lasted for 15 days from July 4, 2022.
The pilots who lost their jobs during the pandemic did not get their jobs back in SAS, but in the subsidiaries SAS Link and SAS Connect.
The SAS pilots believed that the company was thereby trying to circumvent its obligations to bring the terminated pilots back again. SAS, for its part, rejected this and said that the company complied with all agreements entered into.
On the night of Tuesday 19 July, the parties agreed on an agreement which, among other things, ensured that 450 dismissed pilots would get their jobs back in SAS.
The agreement has a duration of 5 years.
But the turbulence is hardly over there. In the time to come, the company must settle in an increasingly competitive and demanding market.