SAS and Norwegian Air See Pre-Pandemic Winter Travel Trends Returning

Scandinavian airlines SAS and Norwegian Air see what executives describe as a “normal” decline in passenger numbers as they look ahead to the coming winter, comparable to what they saw before Covid-19. The two competitors, which are the top two airlines in Scandinavia by number of seats, have few concerns over the threat of inflation or a possible economic recession and are making regular seasonal schedule reductions for the coming winter. Norwegian Air, which restructured during the pandemic into an all short-haul budget airline, is making the biggest change with plans to reduce seats by 24-28 percent from the end of October through February compared to its summer schedule. “I think this is the first time we have done that,” Norwegian Air CEO Geir Karlsen said during the airline’s second quarter earnings call on August 25. “And why are we doing it? Well, because we think that the demand will be lower.” Karlsen and his management team are laser focused on reducing unit costs excluding fuel to below 0.4 Norwegian kroner ($0.04) and achieving consistent profitability at Norwegian Air, which was plagued with losses prior to its restructuring. SAS CEO Anko van der Werff, speaking during the airline’s fiscal third-quarter — covering the May-to-July period — earnings call Friday, is taking a more conservative view of winter. He declined to provide guidance for the period given the airline’s US Chapter 11 bankruptcy restructuring and the potential for inflationary or recessionary headwinds. However, he was clear that SAS is seeing the “normal slowdown” in demand after the summer, and adjusting its schedule as it did prior to the pandemic. “Given the uncertainty at a macroeconomic level … I am not convinced yet about this winter,” Van der Werff said expressing some caution for the upcoming period.<br/>