Swedish regional carrier Skyways and its sister carrier, City Airline, are to file for bankruptcy, according to MarketWatch.com. The bankruptcy is likely to cause cabin crew, pilot and ground staff job losses. It is also thought that 12,000 SAS passengers are affected by Skyways and City Airlines cancellations.
The small carriers are part of a Nordic airline group created by Ukrainian entrepreneur Igor Kolomoisky through his investment company Mansvell Enterprises Ltd, says MarketWatch.com
. His company collapsed this year as high fuel prices and sluggish growth have severely disrupted Europe's airline sector. Analysts say there is over-capacity in the Nordic market.
Last week Skyways Express AB and its subsidiary City Airline AB Tuesday cancelled all flights with immediate effect and said it will file for bankruptcy as its owner said it could no longer finance the Swedish regional airline.
Danish regional carrier Cimber Sterling, also owned by Mansvell, filed for bankruptcy on 3 May this year. Meanwhile Hungary's national airline Malev and Spanish regional airline Spanair went bust earlier this year.
"It feels very sad for the company and for our passengers that will be immediately affected," said Mikael Wangdahl, chief executive at Skyways and City Airline.
"We have come far in turning the company around but after the bankruptcy of Cimber it became almost impossible to continue," said Mikael Wangdahl.
Skyways and City Airline fly between around 20 destinations within Scandinavia as well as to Switzerland, the UK, France and Germany, with a fleet of 11 Fokker-50 propeller planes and a handful of Embraer aircraft.
Scandinavian airline SAS has said that about 12,000 of its passengers will be affected by the financial collapse of Skyways and City Airline with which it has codeshare agreements allowing the smaller airlines to feed traffic to SAS's Stockholm, Gothenburg and Copenhagen hubs. [A codeshare is an aviation business arrangement whereby two or more airlines share the same flight. A seat can be purchased on one airline but the flight is operated by a cooperating airline under a different flight number or code.]
SAS, which is struggling to reduce its losses with a wide-ranging restructuring program of its own, said it will be difficult for it to replace flights that were operated by Skyways' and City Airline's propeller planes with its own bigger jet aircraft, but it is looking at other possible solutions.
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