Scandinavian Airways is voluntarily submitting for Chapter 11 chapter safety within the U.S., as a strike by its pilots on account of an ongoing pay dispute has grounded half of the service’s flights.

The airline harassed that the Chapter 11 transfer was a part of its monetary restructuring plan, often known as SAS Ahead, and that it was working its schedule as regular, other than the direct influence of the strike by pilots, which began July 4.

SAS stated it might meet its enterprise obligations within the “close to time period” with a money steadiness of round $750 million on June 30. However the airline warned the pilots’ strike would have a “damaging influence on the liquidity and monetary place of the corporate and, if extended, such influence might develop into materials.”

Carsten Dilling, chairman of SAS’s board, stated: “We have now been working carefully with the SAS administration group to progress SAS Ahead. As a part of that course of, SAS has additionally been making ready for the choice to utilise court docket restructuring proceedings to be able to handle the corporate’s monetary scenario. 

“The continuing strike poses vital challenges to our capability to succeed with our transformation. The board has concluded that authorized instruments are required to make progress in our ongoing negotiations with key stakeholders, and finally to reach making SAS a aggressive and financially robust enterprise.”

The corporate and pilots unions have been locked in talks in latest weeks however these negotiations have to this point proved to be unsuccessful main as much as the strike, which is able to cancel round 50 p.c of SAS’s flights and have an effect on an estimated 30,000 passengers per day.

Anko van der Werff, SAS president and CEO, stated: “A strike at this level is devastating for SAS and places the corporate’s future along with the roles of 1000’s of colleagues at stake. 

“The choice to go on strike now demonstrates reckless behaviour from the pilots’ unions and a surprisingly low understanding of the crucial scenario that SAS is in.”

Flights operated by SAS Hyperlink, SAS Join and exterior companions aren’t affected by the pilots’ strike. 

Van der Werff stated of the transformation course of: “We’re making progress, however quite a lot of work stays and the continuing strike has made an already difficult scenario even more durable. 

“The Chapter 11 course of offers us authorized instruments to speed up our transformation, whereas having the ability to proceed to function the enterprise as traditional. We are going to proceed to construct again the community connectivity, merchandise and repair our prospects count on, and we’ll proceed to take action all through this course of and past.”

Main U.S.-based carriers have used the Chapter 11 chapter safety course of to efficiently restructure their companies in latest a long time.

Van der Werff harassed that SAS was “able to resume mediation as quickly as potential” with the pilots’ unions to attempt to attain “an settlement that’s viable to safe the long-term competitiveness and monetary sustainability of the corporate.” 

“We presume that the SAS Scandinavia pilots’ unions realise what’s at stake and select to proceed the work to search out an settlement,” he added.

Initially printed by BTN Europe.