Scandinavian Airlines System (SAS) Group’s new President and CEO Anko van der Werff says the carrier has to reach a lower cost structure to be able to sustain the new competition coming to its Stockholm Arlanda base.
Stockholm Competition
The Star Alliance member will be faced with new rivals at one at its main hubs. Besides the announcement that Irish Low Cost Carrier Ryanair and Lufthansa subsidiary Eurowings will open bases at Sweden’s largest airport, Finnair will also operate three Airbus A350s from there on long-haul routes.
Van der Werff told me recently about his plan to protect the carrier in its home market. “This is our turf, this is our market, and what we have to do is to set up ourselves for success in that leisure space,” he said.
Anko van der Werff has been named as President and CEO of Scandinavian Airlines Systems (SAS) on April 28th 2021. He took over the position in July from Rickard Gustafson, who had run the airline for a decade.
Van der Werff gained experience as an airline manager as CEO of Avianca (two years) and before that he spent five years with Aeromexico as Chief Revenue Officer. Dutch-born van der Werff joined SAS not only in one of the most difficult times for aviation, but also in the year that the airline celebrates its 75th anniversary.
Formerly CEO of Colombian flag-carrier Avianca, van der Werff took the reins of SAS in June 2021.
The new CEO said SAS would continue to lead the corporate market in Scandinavia. “We will remain, for whoever wants to fly with us, the business airline of choice, but now we have to do so much more,” he said. “I want to make sure that the airline, when we come out of [the pandemic], is able to compete in the leisure field.”
However, to reach this target structural change within SAS is needed to drive down unit costs. “What we are doing is making sure that also the other operating units are competitive, are able to compete. There is no other agenda than that,” he said.
The CEO describes the short-haul market as a “game of costs” while long-haul operations are the “game of premium revenues” through business class, offering connections and more. “Currently we cannot compete the way I want us to be compete,” he added.
Van der Werff is steeling SAS for the LCC arrivals at Arlanda in the coming months. Ryanair will open a base at ARN during the 2021 winter season and launch domestic services in Sweden for the first time. The number of destinations offered by the Irish airline is set to reach 24 by March 2022.
In late March, Eurowings will then establish a new base at ARN with five Airbus A320s. The German carrier has plans to eventually offer flights from their Stockholm base to as many as 20 destinations.
Meanwhile, Finnair is expanding their intercontinental footprint at the airport. The Finnish flag-carrier will launch services to the US and to Thailand from late October, operated by three of the oneworld alliance member’s A350s that have been deployed to Stockholm.
SAS is the multinational airline of Sweden, Denmark and Norway. “There is a lot of point-to-point traffic in every country,” van der Werff said. However, the scenario is different at Copenhagen Kastrup; which serves as the SAS intercontinental hub.
Multinational Airline
Star Alliance member SAS is the flag carrier of Denmark, Norway, and Sweden. Leading the multinational carrier in a difficult environment and fierce competition, van der Werff understands that innovation has been a natural part of SAS in all these years. But do a multi-national carrier like SAS have a reason to exist in a new aviation world? The states of Denmark and Sweden are shareholders while Norway was before.
“There are two ways answering and this comes point for point to the same conclusion“, he said. In 1946, when the three governments had set up the airline over multiple geographies, they were far ahead of their time. There is one element exactly, when you look at it now: Ryanair has got multiple AOCs all over Europe, Air France-KLM have multiple AOCs, Lufthansa have multiple AOCs as well like the International Airline Group (IAG).
“Yes it is challenging, because there is always additional national interest, like you can see at the other airline groups. But it is where everything is going and it is the right move“, van der Werff added.