Air France-KLM and SAS to benefit from commercial partnership more than equity tie

New interline and codeshare agreements between Air France-KLM and SAS will come into operation on 1-Sep-2024. The agreement will also include reciprocal loyalty scheme benefits and will coincide with the entry of SAS into the SkyTeam alliance.

The new commercial partnership follows the deal agreed in Oct-2023 under which Air France-KLM is to take a 19.9% equity stake in SAS, alongside the lessor/investment firm Castlelake (32% stake), the Danish State (25.8%), and Lind Invest (8.6%).

Currently, Air France-KLM's network airline capacity trails Lufthansa Group and IAG's. Adding the capacity of SAS closes the gap and considerably adds to its European network footprint, particularly in northern Europe.

SAS, which will also join SkyTeam, has been restructuring since 2020 and is now on a more secure footing.

As Air France-KLM is taking only a minority stake, the benefits to both sides will derive from the close commercial partnership.