In a bid to save their company, SAS and its pilots have extended wage talks until Monday, July 2 2022. The strike, if it goes ahead, could prove to be catastrophic for the airline and its thousands of jobs. As per Sydbank’s Pedersen, a strike by the airline would erase up to half of the airline’s cash flow in the first four to five weeks, and the long-term impact could be material.
As a result, Reuters reported that the company and its pilots had extended wage talks until the next Monday. The talks were originally supposed to end at midnight on Friday, but were later extended to 11am on Saturday. The new settlement deadline will be noon on Monday, July 4th. And, according to Reuters, “The longer the wage talks continue, the better.”
Despite this extended deadline, the strike will have huge consequences. In Norway alone, around 30,000 passengers could be stranded during the strike. According to analysts, 76% of SAS flights would be cancelled. If all the strikers go on strike, the airline could end up being forced into bankruptcy. And, of course, a strike could also cost the airline NOK 100 million per day.
Although SAS and its pilots have reached an agreement to extend the negotiations until July 2 of next year, the airline is not without its problems. The carrier has already set up a restructuring plan in 2018 that has reduced the amount of debt it owes to Sweden. However, in recent months, Norway has sold its remaining 10% stake in the airline. The government has argued that it does not need to own airline stocks, since it is a major creditor with pandemic loans. Oslo said that it would support a debt-to-equity plan if it was accompanied by a new equity investment. However, it will not be a long-term stakeholder.
The airline has also extended its payment schedules to cover the unpaid salaries and benefits. The union has asked for more time to resolve the dispute, as the airlines and pilots have had problems with wage negotiations in the past. The strike has a major impact on the airline industry as a whole and could cause hundreds of cancelled flights. And the airline’s stock price has fallen more than 15 percent since the strike started.
The strike by the airline is not the first strike that affected the air travel industry. In fact, the air travel industry has been hit by several strikes and staff shortages. Pay has not kept up with inflation in recent years, and this has resulted in long queues at airports across Europe. Another walkout is scheduled this weekend. So the strike will likely last for a few more weeks.