Thursday, August 18, 2011

A Time Of Overwhelming Profitability For Scandinavian Airways

By Cornelius Albus Xavier


In a sense, it could be implied that Scandinavian Airlines was destined to succeed from it's inception. Over the years, there have been many other airlines with more humble beginnings than this one however. Scandinavian Airlines was born when a Swedish investor and a couple of local airlines in Scandinavia joined together. What this meant for the company was existing assets creating advantages unavailable to similar companies. They were able to get up and going relatively quickly due in part to the pooled assets of existing airlines, combined with established infrastructures. Their beginning was of course, not a fluke, as we can see by their overall success.

It only makes sense for Sweden, Denmark, and Norway to form the partnership that created SAS. The date of birth for the company is August 1, 1946, and merely one year after the end of the second world war. The era after the end of WW II heralded a new beginning for countries all around the world and, therefore, an association such as that between the airlines of these three countries would not be unexpected. 17 September 1946 marks the beginning of operations for the newly founded SAS. The SAS Consortium was put together as a result of other airlines merging with SAS in the 1950s. The ownership shares were proportioned between the three countries and each country divided their share 50/50 between private investors and their respective governments.

What Scandinavian Airlines did was no different that what any other airline had done around the world. Expanding and capturing as much of the market as possible is the goal. Garnering the domestic flight routes within Scandinavia is what made them succeed. The airline accomplished that feat by simply gaining either partial or full control of the smaller airlines operating in their domestic areas. They also worked to do the same around the world and acquired Air Canada and the company that owned Continental Airlines.

The Norway division of Scandinavia Airlines is actually called SAS Braathens. Another aspect of this company, Scandinavian Airlines Norge, was once another division. The SAS Norge was the result of a name change from Braathens to Norge after a merger with SAS Norway. This seemingly confusing name change was actually not that bad. The arrangement of this company in 2007 is still unified in regard to SAS Norwegian operations. Every day flights within the country of Norway are still handled by Scandinavian Airlines Norge. Norge also controls global flights coming out of Norway.

Separate business divisions were created for each of Scandinavian Airlines different service areas. The main structure of this company, from the very beginning, has resembled an alliance between the financial investors and the different airlines in the group. However, eventually, the airlines in the alliance merged with the conglomerate known throughout the world as Scandinavian Airlines System (SAS). Today, the company employs close to 16,000 employees who are spread out in the three partner countries of Denmark, Sweden and Norway.

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