SAS Scandinavian Airlines (SK, Copenhagen Kastrup) is planning to explore joint ventures to enhance its long-haul network and will also seek to use more efficient narrowbody aircraft on some long-haul routes, it said in an update to its ongoing Chapter 11 restructuring process.

"SAS will redesign its short-haul network and fleet to drive significant benefits while maintaining the premium brand in this network, allowing the company to compete with low-cost carriers. The short-haul route mix will be adapted toward the relatively increased leisure travel demand. For example, it will increase its focus on southern European sun destinations. Joint venture solutions will be explored to enhance long-haul and connecting business travel in order to increase customer choices," the Scandinavian carrier said.

It did not provide further details concerning its potential JV partners. The airline is a member of Star Alliance but does not have any JV or JBA agreements. It terminated an 18-year-old JV for routes between Germany and Scandinavia with Lufthansa in 2013.

The airline's new business plan includes cost savings of SEK7.5 billion kronor (USD680 million). While more than half of the savings were already planned in 2020, the airline increased the savings target by SEK3 billion (USD272 million) when its parent SAS Group filed for Chapter 11 restructuring in July 2022. Savings will include approximately SEK1.35 billion (USD122 million) through fleet restructuring. SAS recently disclosed plans to return around 10% of its fleet to lessors.

"Fleet improvements will be achieved by phasing out older, larger and less fuel-efficient aircraft, by replacing widebodies with narrowbodies on some long-haul routes, and by focusing on only three types of aircraft to simplify operations," SAS said.

The ch-aviation fleets module shows that the airline currently operates four A319-100s, eleven A320-200s, thirty-six A320-200Ns, four A321-200s, three A321-200NX, seven A330-300s, five A350-900s, seven B737-700s, and four B737-800s. Its subsidiary SAS Connect operates a further seventeen A320-200Ns, while recently incorporated SAS Link operates four E195s.

"Cost reductions of at least SEK850 million to SEK1 billion (USD77-91 million) are expected to be achieved in reduced aircraft lease and capital costs, with a further SEK500 million (USD45 million) savings to be achieved in maintenance operations," the airline said of its planned fleet restructuring.

Besides fleet restructuring, the airline identified potential savings in operational model and planning (SEK2.3 billion; USD211 million), airport services (SEK1.2 billion; USD110 million), administration, finance, and IT (SEK1.7 billion; USD156 million), and commercial and other costs (SEK900 million; USD83million).

The carrier said it expected to post EBT profit in the fiscal year between November 2023 and October 2024. It hopes to emerge debt-free in 2026.