Scandinavian airline SAS, which slumped into the red for 2008, has said it will step up restructuring, lay off thousands, sell subsidiaries and cut 40% of its routes.
The airline reported a net loss of 6.32 billion kronor (€590m) in 2008, after a profit of 636 million kronor in 2007. Chief executive Mats Jansson described the results as 'horrifying'.
Already weakened in 2007 by technical problems which led to the grounding of some of its short-haul planes, SAS in 2008 faced plummeting demand due to the global economic downturn and the crash in Madrid of a plane from its Spanair division in August.
Out of SAS's loss last year, 4.89 billion kronor was attributable to Spanair, which the Scandinavian company finally sold to a consortium of Spanish investors last week for a single euro.
To overcome its dire financial difficulties, SAS said it would launch a new restructuring programme involving a share issue to raise 6 billion kronor and a fresh 14-plane reduction in its fleet. An additional 3,000 employees would also be laid off while a further 5,600 workers would be taken off its books through outsourcing.
