The airline Swiss closes the first quarter of 2021 with a loss of 201 million Swiss francs. In the same period of the previous year, the deficit was 84,1 million Swiss francs. Sales fell by 67,5 percent to 299,6 million Swiss francs.

According to its own information, Swiss was only able to benefit minimally from the increased demand for freight. Due to the medium-term structural decline in demand, the carrier is forced to consider a significant downsizing in order to preserve investment and competitiveness. In order to revive travel activity, Swiss is calling for stable, uniform and mobility-promoting framework conditions.

Markus Binkert, CFO of Swiss, says: “In view of the extremely difficult market situation since the beginning of the year, the result is in line with expectations. This year, too, the heavily delayed recovery will result in a high loss. "

The ongoing travel restrictions are clearly reflected in the number of passengers. In the first quarter of 2021, Swiss) carried a total of around 290.000 passengers, 90,4 percent fewer than in the previous year). The Lufthansa subsidiary operated a total of 4.429 flights, which corresponds to a decrease of 83,8 percent compared to the same period in the previous year. On the entire route network, Swiss offered a total of 2021 percent fewer seat kilometers (ASK) in the first quarter of 72,8, while the number of seat kilometers sold (RPK) fell by 89,8 percent in the same period. The seat load factor averaged 27,5 percent and was thus 45,9 percentage points below the previous year's figure. On European routes it was still well above the value on long-haul routes.

Lufthansa subsidiary sees liquidity secured

Liquidity should be secured due to the savings program. CFO Binkert also points out that "non-operational projects have been stopped". This also includes the fact that the takeover of aircraft that had been ordered was postponed. In the area of ​​management, salaries were cut by an average of 20 percent. The workforce is to be reduced by 2021 by the end of 1.000. The primary aim here is to rely on natural fluctuation.

“We are very grateful for the short-time working tool. It represents a great financial relief and helps to map the required flexibility in flight operations. As is well known, however, this is a temporary bridging measure that is no longer sufficient if a company has to reposition itself as a result of structural changes in the market. Thanks to all these early measures, Swiss has so far only drawn significantly less than half of the bank loan of 85 billion Swiss francs, which is 1,5 percent secured by the federal government. This means that Swiss’s liquidity continues to be secured, ”explains CFO Markus Binkert.

Downsizing the fleet is being considered

In the medium term, demand will no longer recover to the level from before the pandemic. In addition, the share of business travel is expected to decrease by at least 20 percent in the medium term. Swiss is particularly affected by this with its business model.

“In view of the lack of recovery so far and the ever-slowing upswing, even the greatest cost discipline is no longer sufficient to ensure the future competitiveness of Swiss. We are forced to consider a significant downsizing of the company, ”says Swiss boss Dieter Vranckx. The company also announced that a possible downsizing of the fleet could also affect the route network and the organizational structure. In the next few weeks, the CEO wants to communicate more details. “We clearly see that people want to travel again and we are ready for it. Under the given circumstances, however, no upswing can set in. In order to be able to live up to our mission of connecting Switzerland to the world in the future as well, we demand stable, uniform and mobility-promoting framework conditions, ”said Vranckx.