Belgian national airline files for bankruptcy

BRUSSELS - The Belgian national airline, Sabena, moved into bankruptcy today, ending 78 years of aviation history.

Last night many of the airlines 12,000 employees anticipated the bankruptcy and walked off the job. With catering, cleaning, luggage and check-in staff all involved in wild-cat strikes the airline was forced to cancel most of its afternoon flights.

Extra police were drafted into Zaventem airport at Brussels to control the protests, and the airport authority appealed to Sabena travellers to stay away. Those who tried to call the airline were greeted with a recorded message saying that the office was closed because of industrial action.

The crisis in the aviation industry following September 11 has been been felt across Europe. On Monday the Scandinavian airline SAS warned of a full-year loss and said it would slash 13 per cent of its workforce. It plans to lay off 2,500 people on top of an earlier plan to cut 800 to 1,100 jobs.

SAS's problems pale into insignificance, however, compared with the plight of Sabena. For the Belgian government, which owns a 50.5 per cent stake in its national airline, the prospect of the demise of its flag carrier is a political humiliation which has dominated the news headlines.

Even before September 11, which provoked a massive slump in business for Europe's main carriers, Sabena was on the verge of financial ruin. Rescue plans revolve around the transfer of part of Sabena's assets to Delta Air Transport, one of the airline's subsidiaries which would survive bankruptcy. Sabena's charter offshoot, Sobelair, and its technical department could also escape largely unscathed. But any revamped airline which emerges will probably axe all long-haul routes and may shed as many as 9,000 workers.

Even then it will need to attract new investors whose reluctance to inject cash was underlined yesterday by the reticence of one potential backer, Virgin Express, which already code-shares with Sabena on some routes. It issued a statement yesterday saying it was unhappy with the plans for the creation of a successor airline which "would endanger the future of our personnel," although it added that "talks are continuing."

- INDEPENDENT