Strengths
• SAS has a strong heritage
• The airline has a strong market presence in Scandinavia
• It has, according to internal estimates, strong brand equity with core customers
• It has strong links and networks through: the Star Alliance; bilateral relationships with
other airlines, like Lufthansa; strong complementary and governmental linkup with
airports, like CPH.
• SAS is Europe’s must punctual airline and provides reliable and flexible air travel
• Has accommodated the fall in passenger demand by creasing capacity and
intercontinental travel.
Weaknesses
• EBIT has over the past six years not managed to reach the profitability target
• The passenger yield has declined since its peak in 2001
• The passenger volume has been declining since 2006; Moreover, the number of
passengers has decreased with 15.7 per cent from 2008 to 2009, which is substantially
more than most of SAS’ competitors
• The market shares for the Nordic countries have declined since 2006
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• The Premium passenger segment (i.e. first and business travellers) for AEA’s
members, which include SAS, has declined more than the economy segment from
2008 to 2009 on scheduled flights, due to the global Financial Crisis
• Danish passengers predominately fly internationally (i.e. 85.9 per cent), which is
direct contradiction to the corporate strategy Core SAS with a focus on domestic
travel. This furthermore worsened by the cut in capacity with 15 per cent mostly on
leisure destinations, which is a dangerous move, because the market is continuing to
develop towards these destinations.
• There are weak informal links and network, i.e. via Facebook.com, but they can be
improved.
Opportunities
• Find ways to utilize the SAS football sponsorship in the SAS Legaen. Currently SAS
is only present by naming the league.
• There are many ways to foster links and networks with other constituents within, and
outside, the airline industry, whereby SAS sustainable competitive advantage can be
improved
• To lower the operating costs it might be necessary to follow Norwegian’s example of
just employing one type of aircraft
• Fully outsource SAS Ground Services and SAS Tech might also be necessary to lower
operating costs, and not just parts of them as currently undertaken by Core SAS
• To lower the dependency on business travellers it might be strategically important to
attract other customer segments.
Threats
• The biggest threat is the continuation of the global Financial Crisis; it is important to
note that perhaps SAS’ current financial problems are simply caused by the decline in
business travellers, who might return once the crisis is over. According to AEA
estimates, this not likely to happen as corporate culture has changed in regards to
business travel. AEA further estimates the crisis will last until 2013
• There is continued competition and price pressure from industry rivals and substitutes,
which limits SAS’ profitability
• The Danish market is small and has experienced a slow market growth from 2004 to
2008. According to Datamotor it is expected the market will follow the European
market value and passenger deceleration, but the value will decelerate a slightly higher
rate, whereas the deceleration of passengers will occur at a slightly lower rate, until
2013.
• The other airlines continues to pressure the cooperation and network SAS has
established
• The frequent bad press exposure threatens to negatively affect the consumer
perceptions of the company and the image of the company.
• According to Berlingske Nyhedsmagasin’s Image Analysis SAS has the worst
corporate image of 140 companies. This might also indicate SAS’ customer based
brand equity may in fact be lower than estimated by the company itself