Herman De Wulf/BRUSSELS
Independent auditors have recommended a full merger of Sabena and Swissair as part-solution to the near-bankrupt Belgian flag-carrier's troubles, while blaming its shareholders - the Belgium Government and the Swiss carrier's parent SAirGroup - for its parlous situation.
The audit by International Pilot Services of the USA, appointed by Belgian trade unions representing Sabena staff and backed by the airline, says "a further consolidation is inevitable" since Sabena and Swissair "need economies of scale" to compete with larger European carriers. Present European laws would see Sabena lose its bilateral rights after an SAir takeover.
It adds that the pair's Airline Management Partnership "is designed to create synergies", but that they "should go further into real a merger of activities".
The report says Sabena's huge growth (97% over the last three years against an industry average of 36%) made it vulnerable to an industry downturn, damaging yields, and that its resources were "insufficient" to sustain its fast fleet renewal. It adds that the Blue Sky savings programme is necessary, but that "more is needed to secure Sabena's long-term viability".
The auditors find no evidence of an abnormal transfer of funds from Sabena to SAir, as suggested by the unions, but confirm that it faces big losses for this and last year, and "will run out of cash by the end of of February if nothing is done" to shore up finances.
Around 572 job losses at Sabena and 97 at regional carrier Delta Air Transport have meanwhile been revealed, in line with the number rumoured on the launch of Blue Sky but denied by the government at the time. Sabena shareholders are expected to approve a $235 million recapitalisation plan on 8 February,providing unions approve Blue Sky cuts.
Former Air Belgium chief executive Johan Vanneste is talking with Sabena about resurrecting the defunct carrier to take over regional routes using Embraer ERJ-135 and -145 regional jets. Sabena would wet-lease the aircraft from Air Belgium, offering a lower cost base than the current DAT service which employs Avro RJ85 and 100s. Air Belgium was closed by UK operator Airtours in 2000.Source: Flight International
