SAS tweaks leases for 36 aircraft to cut costs

Passengers board a SAS Scandinavian Airlines plane in the Norwegian Arctic town of Kirkenes May 9, 2022. REUTERS/Gwladys Fouche

STOCKHOLM, Oct 5 (Reuters) - Crisis-hit airline SAS (SAS.ST) said on Wednesday it had reached agreements with 10 of its lessors representing 36 aircraft to amend the terms of existing lease contracts.

The Scandinavian carrier said in a statement the tweaked agreements constituted an important step in reconfiguring its fleet and achieving a plan to save 7.5 billion Swedish crowns ($690 million) annually by 2026.

"Through the amended lease agreements, SAS is well on track in achieving the targeted annual cost savings of at least 850 million Swedish crowns to 1.0 billion in reduced aircraft lease and capital costs," it said.

Long-struggling SAS, ravaged by the pandemic and pressured by low-cost rivals, sought bankruptcy protection in the United States in July. It has said reducing costs for unused leased planes has been a key component of its savings plan.

It said on Wednesday it intended to continue negotiations with some of its other lessors.

($1 = 10.8699 Swedish crowns)

Reporting by Anna Ringstrom, editing by Stine Jacobsen and Terje Solsvik

Our Standards: The Thomson Reuters Trust Principles.