Airline SAS cuts capacity, drops guidance due to coronavirus outbreak

SAS said Tuesday it was cutting capacity and withdrawing its financial guidance for the current financial year after the spread of the coronavirus hit demand. SAS shares have tumbled 35% so far this year. “In response to the lower demand, SAS will in the next couple of months seek to reduce part of its short haul network capacity,” the airline said, adding it would also cut flights to Hong Kong and continue to suspend services to mainland China. “At this stage, it is too early to assess the full impact on SAS operations and financial outcome and therefore not possible to give a more accurate guidance.” A spokeswoman at SAS said the company had seen a big drop in demand over the past few days, not the least to and from the north of Italy, Europe’s worst-affected country. She said the new capacity reductions concerned March and April while there were no decisions made for the important summer holiday season given the uncertain demand outlook. SAS said it was pursuing a number of measures to cut costs, including postponement of marketing and a hiring freeze, while it was also looking to reduce spending on personnel. “Measures related to personnel expenses may include temporary layoffs, voluntary leave, early retirement or other initiatives,” SAS said.<br/>