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.