Swissair - more cash needed

Without a cash injection, luggage trollies could remain empty in the future Keystone

Swissair planes could be in danger of being grounded again if its subsidiaries do not receive funds within the next few weeks.

This content was published on October 28, 2001

Swissair subsidiaries SR Technics, Atraxis and Swissport are in urgent need of a cash injection of several hundred million Swiss francs in order to continue their operation.

In an interview with the SonntagsZeitung, Crossair chairman, Andrè Dosè, described the financial difficulties of the subsidiaries as "three big problem areas".

According to Dosè, Swissair's maintenance and engineering arm SR Technics, as well as Atraxis need around SFr140 million, however, this amount would only keep the companies going for a short time.

To avoid yet another grounding of Swissair planes, Dosè emphasised that cash would have to be injected immediately.

A meeting of the Task Force, which was set up by the Swiss government to salvage the bankrupt national carrier, is scheduled for Monday to discuss the subsidiaries' financial problems.

Grounding could affect Crossair

In an interview with the Swiss daily newspaper "Tages Anzeiger" on Saturday, Dr. Hans Ulrich Beyeler, president of SR Technics, emphasised that another grounding could affect Crossair, as the regional airline is planning to take over two-thirds of Swissair's fleet.

According to Dosè, Crossair's takeover of 52 Swissair planes is not yet guaranteed as this plan depended on the state of the economy. "We are not going to fly empty airplanes," he said.

A second grounding of Swissair planes "would be the end of the new airline," Beyeler explained. He also accused the government of not considering SR Technics when finalising the rescue package for Swissair last Monday.

Under the new plan both industry and government agreed to contribute a total of SFr4.24 billion ($2.57 billion) to set up a new national airline.

SR Technics, which specialises in the maintenance and repair of aircraft and engines, will need a total of SFr240 million until February next year, according to Beyeler.

He explained the company's financial difficulties with the fact that SR Technics did not receive any outstanding amounts from Swissair after the carrier collapsed earlier this month.

Not creditworthy

Even though Switzerland's biggest banks, UBS and Credit Suisse Group, have granted Swissair a bridging loan of SFr250 million, SR Technics, Atraxis and Swissport were not included in the loan, as "the banks do not think we are creditworthy," Beyeler said in the interview.

"The banks should realise that granting SR Technics a loan would be an investment in the future," he stressed.

Due to the collapse of the Swiss carrier, SR Technics is undergoing a restructuring scheme, under which the company is planning to shed about 800 workers and reduce its workforce to 2,800.

SR Technics is currently in talks with several major Swiss banks.

swissinfo with agencies

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In compliance with the JTI standards

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