BBC NEWS Americas Africa Europe Middle East South Asia Asia Pacific Arabic Spanish Russian Chinese Welsh

 You are in: Business
Front Page 
UK Politics 
Market Data 
Your Money 
Business Basics 
Talking Point 
In Depth 

Commonwealth Games 2002

BBC Sport

BBC Weather

Wednesday, 7 November, 2001, 18:13 GMT
Belgium creates new airline
Sabena planes
Sabena's planes will fly no more
Belgian Prime Minister Guy Verhofstadt has announced the launch of a new Belgian airline on the same day that its national flagship, Sabena, has filed for bankruptcy.

The new airline will be based in Brussels and will, unlike Sabena, be independent of the government.

Mr Verhofstadt's said that after intensive talks with investors that the new airline - as yet unnamed - would be capitalized at 200m euros ($180m), including 155m euros from 12 Belgian banks and enterprises.

The remaining capital is to come from Belgian regional investment corporations.

Salvaged jobs

The new airline is to be launched "as quickly as possible," using Sabena's still-functioning regional subsidiary Delta Air Transport as a launch pad.

The new carrier will employ 2,000-2,500 people, trimming the estimated redundancies at Sabena to a net loss of 5,000-5,500.

It will focus on European and African routes.

A statement on Sabena's web site said the company hoped many of its European flights would resume via DAT "in a few days".

Sabena, the 78-year-old national airline which filed for bankruptcy on Wednesday, is part of a larger Sabena group, subsidiaries of which continue to operate.

Stiff competition

However, the new Belgian carrier will face stiff competition from established European airlines hoping to carve up Sabena's share of the market between them.

Air France is expected to snap up much of Sabena's holiday travel business, as Belgian holidaymakers can easily take a fast train from Brussels to Paris to catch a flight.

Dutch airline KLM said it had already begun benefiting from Sabena's high-profile problems during recent weeks.

"Many passengers in Belgium who feared a collapse of Sabena booked with KLM instead," said Bart Koster, a KLM spokesman.

American Airlines, which competed with Sabena on the lucrative Brussels to New York route, now stands to gain a larger share of the transatlantic market.

On short-haul routes, Sabena's successor will be exposed to competition from smaller European operators.

On Wednesday, independent carrier British European, part of the Walker Aviation Group, launched three daily flights from Newcastle, Edinburgh, and Birmingham to Brussels.

See also:

07 Nov 01 | Business
Belgian national airline bankrupt
01 Nov 01 | Business
Swissair rescue hopes brighten
17 Oct 01 | Business
Europe says no to airline aid
07 Nov 01 | Business
Sabena: From pioneer to failure
12 Oct 01 | Business
Round-up: Aviation in crisis
Internet links:

The BBC is not responsible for the content of external internet sites

Links to more Business stories are at the foot of the page.

E-mail this story to a friend

Links to more Business stories