HERMAN DE WULF / BRUSSELS
The Belgian flag carrier's series of economy measures have resulted in a legal action for breach of contract
Virgin Express is suing Belgium's national airline Sabena for breach of contract following the latter's decision to reduce the number of seats it buys from the low-cost operator on flights to Barcelona, London Heathrow and Rome.
In 1996 Sabena agreed to buy 80 seats from Virgin Express on flights to Rome and Barcelona and 85 to London Heathrow as it was cheaper than operating the routes itself. In 1999 the deal rose to 96 seats on all three services, with the contract to expire in 2005.
The arrangement has come under pressure during Sabena's cost-cutting moves, which include 1,600 job cuts - half of which are among air crew. The airline's pilot union BeCA, backed by the cabin crew union, has called for Sabena to end the contract and serve the routes itself. In response, Sabena has reduced the number of seats it buys back to the 1996 agreement.
Virgin Express says that the move constitutes a breach of contract and initiated court action against Sabena late last month. "We have restructured our company to break even this year. Sabena's unilateral decision jeopardises our plans. Virgin Express should not pay for the restructuring of Sabena," it says.
Meanwhile, Sabena has revealed a requirement for 22 50-seat aircraft over the next five years as part of its downsizing plan. Sabena must concentrate on Europe and operate smaller aircraft to achieve better load factors, says chief executive officer Christopher Müller.
The new 50-seaters would replace its remaining Boeing 737s and three Airbus A321s, the latter which are already for sale, along with two A340s. Sabena has completed sale and lease back deals with Bouillion Aviation Services and Singapore Aircraft Leasing Enterprise on two A319s.
This money and the proceeds from the sale of the A321s and A340s will be used to finance the new aircraft. Older British Aerospace 146/Avro RJs operated by Sabena commuter DAT will also be sold.
A decision on aircraft type has not been made, but fleet commonality with Swissair favours the Embraer ERJ-145, operated by Swissair subsidiary Crossair, rather than the Bombardier CRJ200.
Source: Flight International
