Customers demand SAS refund

SAS wanted to control the Copenhagen-Stockholm-Oslo triangle

Danish and Swedish airline passengers are threatening to go to court to get their money back from the Scandinavian airline SAS after the European Commission found the carrier guilty of price-fixing.

SAS chairman Harald Norvik and chief executive Joergen Lindegaard have both said sorry

Both Sweden's consumer ombudsman and a business association which represents 100,000 small Swedish companies are preparing to sue SAS to force it to refund customers.

In Denmark, a group of companies which bought business flights via Danish Travel Pool, late last month teamed up with the consumers association to demand a refund and to prepare to sue the airline.

So far, SAS has ruled out any payment to customers, arguing that the Maersk deal did not cause overcharging.

The compensation demands come as the Swedish competition authority says it is investigating separate price-fixing allegations between SAS and Skyways, its partner in Sweden.

A ruling is expected in the autumn.

Heavy criticism

SAS is under increasing fire over the price-fixing scandal following the revelations that it had tried to monopolise Scandinavian flight routes by striking an illegal deal with Maersk Air of Denmark.

In addition to the consumer organisations and industry confederations, several trade unions, private shareholders, institutional investors and politicians have all launched separate attacks on the airline over the past week.

The carriers' critics were not mollified by the apologies offered last week, both by the airline's chief executive Joergen Lindegaard and by its chairman Harald Norvik, who on Wednesday ordered an independent inquiry into the affair.

Illegal deal

Away from the courts, the carrier is being punished by investors.

So far, Vagn Soerensen, former deputy chief executive, is the only one who has resigned

The fund manager Etix, owned by a Swedish blind people's foundation, sold its stake in SAS on Friday, saying that the company's business methods were illegal.

Several Swedish pension fund managers are considering selling their SAS shares due to ethical concerns after the airline was fined nearly 40m euros (£24m, $35m) by the European Commission on 18 July for price-fixing.

On Monday, SAS was trading at about 82 Swedish kronor (£5.60, $8) per share, just above its year-low of 79 kronor hit last week after the carrier reported an 84% fall in pre-tax profits for the second quarter.

Powerful voices

SAS, which is half owned by the governments of Sweden, Norway and Denmark, has also managed to upset the powerful Swedish Wallenberg family.

"This is not acceptable. I demand a fast investigation into the affair," said Jacob Wallenberg on behalf of the Wallenberg foundations whose 8% stake in SAS makes it the biggest non-government shareholder.

So far, just one SAS executive - the former deputy chief Vagn Soerensen - has resigned because of the affair, but calls for more heads to roll are mounting in the media in all three Scandinavian countries.

Sweden's trade union organisation LO, a major shareholder, and Danish politicians alike have expressed doubts about claims by SAS board members that they never knew about the Maersk Air deal.

This has angered Mr Norvik.

Major shareholders have said they will wait for the outcome of an independent inquiry before they decide on the board's future.

Competitors enter

SAS, which has so far had much of the Scandinavian flights market cornered, is expected to face an onslaught by competitors aiming to target its disgruntled customers.

The Danish airline Sun-Air says it is considering a challenge to SAS on flights between Oslo and Copenhagen.

On Monday, the Danish newspaper quoted British Airways' boss in Denmark Sam Heine saying the airline is considering introducing flights between the Scandinavian capitals, a claim later denied by a BA spokeswoman who said the airline has no such plans at the moment.