Airline Weekly Lounge Episode 44: Struggling SAS
Scandinavia’s SAS posted a pretty rough quarter despite huge tailwinds from its healthy home economy and cheap fuel. Fierce competition, labor concerns and operational problems all share the blame. Is SAS’s long-haul strategy the answer? Or will it take a merger?
Meanwhile in Africa, Fastjet is failing fast, posting an ugly 2015 full-year result. Clearly, it is tough to be a start-up airline on a continent rife with bureaucracy and protectionism. The turboprop carrier Flybe achieved a small annual profit, which was a big deal. Will the airline’s resurgence continue? And for U.S. carriers Delta, American, United and JetBlue, unit revenue declines haven’t stopped—there was hope they would’ve by now—and costs have stopped falling. That’s a recipe for margin pressure.