Ceilidh From , joined Dec 1969, posts, RR: Posted (14 years 4 months 1 week 2 days 11 hours ago) and read 1300 times:
There's no doubt that Sabena is on its last legs. Management have one month to put a new strategy together.
What makes sense for them?
I'd say that they have four options:
1) Concentrate on regional operations, using DAT as the basis. This was one of the primary objectives of Muller's Survivial Plan
2) Join forces with other carriers - given that Sabena has already had a number of ill-fated unions with carriers including British Airways, British Caledonian, KLM, SAS and Air France - let alone Swissair - the biggest problem is going to be to persuade someone that SN has something to offer.
3) Sell the company - Again, the problem is going to be who would buy it and most importantly who would finance the costs involved with restructuring? Financing an airline today is like trying to raise money for a Synagogue in Nuremberg in 1942!
4) Liquidation - close down the company and sell off the assets.
Ceilidh From , joined Dec 1969, posts, RR:
Reply 5, posted (14 years 4 months 1 week 2 days 11 hours ago) and read 1210 times:
We're agreed then that DAT is the only viable part of SN.
AA is in deep trouble of its own and is likely to go into Chapter 11 within a matter of months. They are bitterly regretting buying TWA, and in any case could not buy a European airline. Nor would BA allow them to buy SN - there is nothing that SN does that BA does not!
Why would anyone want to buy the name Sabena? It's one that is synonomous with the problems over the last forty years - logically, any new airline would want to start off with a new name and identity.
Nor do I forget that there is a market for low fare long haul airlines out of Europe - after all, that's what I have spent the last 18 months trying to set up - but the key issue here is that low cost airlines need low operating costs as well. SN has one of the highest costs per passenger of any European airline!
Stratofish From Germany, joined Sep 2001, 1076 posts, RR: 5
Reply 6, posted (14 years 4 months 1 week 2 days 10 hours ago) and read 1195 times:
It has been written in the news often that DAT is the MOST viable part of SN. So... why should I doubt it...
I know AA at the moment is in no position to buy SN at the moment and the months to come, though it would be a good and productive marriage. Especially since BA could use SN´s infrastructure and lower it´s own costs if they act wisely.
SN has been arround for many decades... many people have flown them so many may also show what the marketers call brand loyalty.
Highets cost per passenger? Well I guess that´s because they pay their staff better than BA for example. Don´t have any figures on hand.
Ceilidh From , joined Dec 1969, posts, RR:
Reply 7, posted (14 years 4 months 1 week 2 days 10 hours ago) and read 1194 times:
Stratofish - there's only one month to put this together, so I don't think that anyone will be waiting for AA to buy SN!
How, exactly, could BA use SN to reduce its own costs - given that its costs are lower than those of SN?
As for the brand loyalty - I agree with you that that would normally be the case but the reality is that recent actions have upset so many passengers it will take a very long time - if ever - for them all to come back.
ScottB From United States of America, joined Jul 2000, 7347 posts, RR: 30
Reply 8, posted (14 years 4 months 1 week 2 days 7 hours ago) and read 1158 times:
Honestly, if you ask me, the future looks very dark for Sabena beyond the one-month timeframe. And the only possibilities for survival would be extremely painful.
(1) Effective immediately, cut EVERY route that you can't make profitable (with *realistic*projections) within a 30-day timeframe. This is even more difficult considering that (a) global traffic levels are down post-September 11 (b) the winter is very tough for transatlantic markets and (c) travelers are likely to book away from Sabena given the pilots' strikes and uncertainty that their tickets will retain value. But Sabena certainly can't afford to continue throwing money at money-losing routes. This will more-or-less require a focus on routes that work mainly on traffic with a destination or origin in Belgium, I suspect.
(2) Whether the various employee groups like it or not, Sabena MUST substantially reduce pay levels AND staffing (the two are related; after all, certain routes might be made marginally profitable if employee costs can be reduced - this would save some jobs). The choice here is between losing some jobs and lower salary levels and losing ALL jobs with resulting salary levels of ZERO. And yes, Sabena absolutely must reduce its management ranks to have any credibility with its employees.
I doubt that you'd find anyone interested in purchasing Sabena until it can be made into a profitable entity, especially considering the current financial condition of most carriers. NONE of the American carriers can afford to take on Sabena's debts even if the purchase price for the airline were $1. They're all trying to conserve cash to ride out the crisis in the American market. The stronger European carriers really don't gain anything from a Sabena purchase. Moreover, even though this may sound callous, you could likely do better simply by cherry-picking Sabena assets in a liquidation.
Though the Sabena name once carried some value, I suspect that today few would have a strong interest in preserving it (outside of those who would wish to do so motivated by Belgian nationalism). They gained enough of a reputation for poor, unreliable service that they felt a need to advertise themselves recently as most-improved-airline.com. And in light of recent news, the public views them as financially troubled with an uncertain future. I don't think I'd want to book tickets in advance without knowing they'd still be in business to honor them. TWA was dogged by this problem for many years.
ETA Unknown From Comoros, joined Jun 2001, 2210 posts, RR: 0
Reply 11, posted (14 years 4 months 1 week 2 days 7 hours ago) and read 1157 times:
1. Keep DAT. Rename it DIS (Division Internationale de Sabena). Then make up jokes about DIS or DAT.
2. Beg Virgin to buy half the 737's for its Australian operation.
3. Sell half the airbus fleet to KLM/Martinair/Transavia
4. Sell the other airbus half to either Aerolyon/Air France/Air Lib/ Corse Air- basically any French speaking speaking company around... provided the Flemish will agree!
5. Sit back and wait for DIS to go on strike, citing the need for an EU cash injection.
Sorry, that was naughty of me, but I have trouble feeling sympathy for an airline that forgets to load my baggage onto a flight when one checks-in 2 hours in advance at their home base.