Carrier SAS files for Chapter 11 bankruptcy protection in US

COPENHAGEN, Denmark (AP) — Scandinavian Airlines on Tuesday filed for bankruptcy in the United States, warning the announcement of a strike by 1,000 pilots a day earlier had put the future of the carrier at risk.

The move adds to the likelihood of travel chaos across Europe as the summer vacation period begins.

The Stockholm-based group said it had “voluntarily filed for chapter 11 in the U.S., a legal process for financial restructuring conducted under U.S. federal court supervision.”

Filing for Chapter 11 in New York puts civil litigation on hold while the business reorganizes its finances, dubbed SAS Forward.

It added that its operations and flight schedule will be unaffected, and SAS will continue to serve its customers as normal.

Anko van der Werff, CEO of SAS, said that ”the strike has accelerated it,” adding "I think we have been very clear that this could happen.”

“The important thing is that this is about bankruptcy protection, it is not about a bankruptcy, but it is about financial reconstruction,” van der Werff said.

The pilots reacted strongly to the news. Roger Klokset, head of the SAS pilots union, said the group “had stretched negotiations and mediation from November last year until the day before the application, without ever having the intention of entering into an agreement with the SAS pilots."

The pilots announced their strike on Monday, citing inadequate pay and working conditions and expressing dissatisfaction with the decision by the carrier to hire new pilots to fill vacancies at its subsidiary airlines, SAS Link and SAS Connect, rather than re-hire former company pilots laid off due to the pandemic.