The Future of SAS

Simon Christiansen

Student thesis: Master thesis


Scandinavian Airlines (SAS) was founded in 1946 as a joint venture between Denmark, Norway, and Sweden. SAS AB (the parent company) is today listed on the Swedish stock exchange, and the ownership is divided between institutional and private investors. The three governments jointly own 42.7 percent of the shares, whilst the rest are freely traded. This unique ownership structure, part state owned, and part privately owned, makes for an interesting case.
The purpose of this master thesis is to assess and evaluate the current state of SAS, as well as to assess the future of the company. The thesis consists of three main parts, company overview, strategic, financial, and operational analysis, and scenarios of the future. First, the company overview gives the give the reader a descriptive overview of SAS’ history, business strategy, and competitors. Secondly, the strategic, financial, and operational analysis, involves an extensive examination of SAS at a macro-environmental, micro-environmental, and company level. Thirdly, the scenarios of the future utilize information and key findings from the two previous parts in order to conduct four distinct scenarios of the future of SAS, before arriving at the most likely scenario.
The strategic analysis is relevant because SAS is operating in a harsh market, where external factors heavily affect the airline industry, and where SAS is opposed by fierce competition from the low-cost carriers, with a competitive landscape being characterized as driven by ticket prices. A somewhat biased SAS, along with customers’ lack of loyalty in the industry contributes to the harsh environment, where one needs to fight for every percentage of market share. Furthermore, SAS’ costs are amongst the highest in the industry, which has limited SAS’ manoeuvre room to turn the company around. Costs have over the course of time been reduced multiple times, in order to catch up on competition. The two recent strategies, 4 Exellence and 4 Excellence Next Generation, with divestment and layoffs as mean to accomplish it, has given SAS room to make a more long-term strategy instead of only short-term cost cuttings.
SAS’ declining financial results during the last decade, has been anything but a source of pride, but SAS can now present indications of a better future. In spite of these indicators, SAS still needs to optimize its processes and operations, in order to become a profitable airline.

EducationsMSc in Management of Innovation and Business Development, (Graduate Programme) Final Thesis
Publication date2017
Number of pages174
SupervisorsJuliana Hsuan