THIS year is a big test for Scandinavian flag carrier SAS. The airline has pledged to instill an improved service ethic in staff and has just rolled out a new livery.
These changes alone are considerable things to manage, given that the airline is having to cope with intense European competition – but for SAS there is another headache to worry about – the low-cost airlines.
Ryanair and British Airways’ Go have targeted the traditional hubs of SAS at Copenhagen, Stockholm and Oslo.
To combat this new threat the airline – which only ever had to compete with BA on UK routes – is trying hard to distinguish itself from budget airlines.
On top of this, SAS also has to cope with BA’s expansion in Scandinavia with partner Finnair, and KLM’s alliance with Braathens.
Almost all 18,000 SAS staff have finished intensive training courses to improve onboard and airport service.
The aircraft fleet is being updated with new Boeing 737-600s replacing MD-80s and DC9s on routes from Heath- row, Stansted and Manchester, raising capacity and improving in-flight service.
The airline is also dedicated to upgrading check-in at key airports with automatic check-in desks and electronic tickets to provide a faster service.
It has even started to take on Ryanair and Go by launching Stansted flights to Stockholm and Copenhagen.
Alongside this, SAS has just launched codeshare flights with Denmark’s Maersk Air on Gatwick routes to Copenhagen and Billund. This means it now offers flights from three London airports, as well as Manchester services to its three Scandinavian hubs.
In order to keep business-class passengers the airline also rolled out its SAS Travel Pass last year. It allows passengers to buy blocks of 10, 20 or 30 flight sectors. The flights are programmed into a card which is used as a coupon at airports to receive boarding passes. SAS claims regular users can save up to £1,000 on 30 flight sectors.
Travel Pass can be tailor-made for specific routes, such as Heathrow-Copenhagen. SAS claims agents benefit from selling the pass as commission is paid on the complete package up front.
The SAS Eurobonus frequent flyer programme has also been improved to offer greater benefits for passengers qualifying for one of its three levels.
However, the SAS drive to cut costs has not been good news for all agents.
In its own Scandinavian market, retailers have been paid a basic 6% commission since January – a cut from 9%. UK agents suffered a smaller cut, from 9% to 7%, on April 1.
The reduction is in line with SAS partners Lufthansa and United Airlines, which have reduced commission in domestic markets. The German airline has also dropped payments to 7% for UK agents.
Retailers fear other SAS partners, including United and Air Canada, will follow suit.
On April 1, SAS welcomed its latest partners, Air New Zealand and Ansett Australia, to Star Alliance. The addition will allow SAS to share flights to Australasia. SAS is also looking at ways of improving its agreement with British Midland following the UK airline’s decision to drop Scandinavian routes from Heathrow this summer. A deal is expected to see British Midland codesharing on some SAS services.