SAS JOINS SKYTEAM: The End of 27 Years in Star Alliance

Intro On May 14th, 1997, five airlines came together to  form a new airline network called “Star Alliance”.   The alliance called itself “The Airline  Network for Earth”, supported by the fact   that these five airlines came from three different  continents. These five founding members consisted   of Air Canada, United Airlines, Lufthansa,  Thai Airways, and Scandinavian Airlines.   Fast forward 27 years later and Scandinavian  Airlines has officially exited the alliance   it helped create. Today, we will analyze the  transition SAS has made from Star Alliance   to SkyTeam and see what benefits it will bring  for the carrier and its customers in the future.  Backstory Last year, in October 2023, Scandinavian Airlines  suddenly announced its imminent departure from   Star Alliance, a topic I covered right around that  time. This move caught many including myself by   surprise but the truth was that SAS had constantly  been struggling financially. As part of SAS   Group’s restructuring, the Government of Denmark,  two investment firms, and Air France-KLM would   become stakeholders in the group. Air France-KLM  would control a 19.9% stake and it was this move   that hinted at Scandinavian Airlines coming  closer to leaving Star Alliance. By March 2024,   the U.S. Bankruptcy Court approved this new  restructuring plan which eventually allowed   SAS to exit Chapter 11 bankruptcy protection.  By April 29th, SAS confirmed it would exit Star   Alliance on August 31st and enter SkyTeam  the following day. The European Commission   approved the restructuring on June 28th. So now it’s September 2nd, Scandinavian   Airlines is officially a SkyTeam member, closing  27 years in the Star Alliance. With $1.2 billion   in new investments, the airline has emerged  from bankruptcy proceedings in what its CEO   Anko van der Werff calls a “new era” for the  airline. He noted that the carrier is in a much   stronger position with lower debt and lower costs.  In fact, July 2024 was the most profitable month   in the airline’s history, very encouraging  to hear for an airline that has struggled   financially for many years. So now that SAS is  part of SkyTeam, what does that mean for loyal   New Changes customers who have flown the airline for many  years and gained benefits with its Star Alliance   partners? In official statements released by  both SAS and SkyTeam, SAS EuroBonus members will   immediately enjoy benefits across SkyTeam partner  airlines with Silver members being recognized as   SkyTeam Elite and Gold and Diamond members being  Elite Plus. They will be able to access perks like   airport lounges and SkyPriority services. SAS joining SkyTeam now aligns with partner   carriers like Delta, Air France, Aeromexico, KLM,  Saudia, Korean Air, and so many others. Customers   can benefit from easy connectivity across over  1,000 destinations worldwide. Now speaking of   U.S. Route Strategy destinations, a massive speculation when SAS  announced its departure from Star Alliance   was how it would shift its route network to  reflect this change. When we look at the U.S.,   I remember mentioning that SAS would likely cut  services to large United Airlines hubs and then   launch services to Delta hubs. Before leaving  Star Alliance, SAS operated flights to the   following U.S. airports (JFK, EWR, IAD, ORD, SFO,  LAX, MIA, BOS). Five of these are official Star   Alliance hub airports thanks to United Airlines  and two of them, Newark and Washington Dulles,   are dominated by United and Star Alliance.  SAS hasn’t cut any of these cities just yet   nor have they disclosed any plans to do so.  However, SAS added a new U.S. destination   back in June reflecting its eventual shift  to SkyTeam. Service between Copenhagen and   Atlanta launched on June 17th and has been  running daily before eventually decreasing   to five weekly flights in the winter. Looking at  the other current U.S. destinations, JFK, LAX,   and Boston are the only ones with large Delta  presences. You could also argue Chicago O’Hare   is up there too given Delta controls a significant  part of Terminal 5 as well. So right now it’s kind   of hard to tell what SAS plans to do with its  U.S. network. I can see them leaving Newark and   shifting their Oslo and Stockholm flights to JFK  but that would be hard given how slot-restricted   that airport is. And fun fact, Newark is SAS’ only  U.S. gateway with service to all three hubs: Oslo,   Copenhagen, and Stockholm so while it would be  unfortunate to see this end, it’s anyone’s guess   what SAS will decide because staying in Star  Alliance hubs like Newark and Dulles don’t seem   like great ideas at least in my view. With SAS now joining SkyTeam,   I’m eager to see them expand their  reach into the U.S. if that wasn’t   obvious already. As far as widebody aircraft go,  the carrier has one A330-300 and two A350-900s   on order so hopefully we could see the airline  announce more U.S. routes once these planes come   in. Some cool examples could be relaunching  service to Seattle and adding new service   to Minneapolis and Detroit. Given Aeromexico is  also a SkyTeam member, well, maybe we’ll see new   service to Mexico City coming soon too which would  be great since SAS has never served Mexico before.  Now SAS passengers have undoubtedly lost out  on a decent amount of global connectivity with   the carrier leaving Star Alliance. That’s because  Star Alliance is home to global powerhouses like   Turkish Airlines, who serve the most destinations  of any airline, and Ethiopian Airlines,   who continue to grow rapidly and have the largest  network throughout the continent of Africa. But   of course, the main concern for SAS and its  administration was the airline being in good   financial health and the move over to SkyTeam  is giving them just that. Let me know what you   think of SAS transitioning to SkyTeam and what  changes you expect in the future. As always,   thank you very much for watching and until  I see you next time, take care, and goodbye.