Switzerland’s Crossair has frozen all hiring for an undetermined period, redoubled efforts to attract more business passengers, reduced frequencies on a number of marginal routes and moved smaller airplanes to others as the regional airline attempts to reverse one of the most difficult financial periods in its illustrious history. The measures have reduced available seat miles by 3 percent and improved its balance sheet by $18 million through the first half of this year, according to Crossair.

Nevertheless, Crossair announced a first-half operational loss of $10.8 million, just six days after Swissair Group–the regional’s parent company–erroneously reported a profit for its subsidiary of $22.5 million. A slightly embarrassed group spokesman attributed the discrepancy to different accounting procedures used by Crossair and Swissair. He stressed, however, that the entire group has turned the corner on the road to recovery, despite a reported group loss during the first period of $26 million.
Humbled by the fatal crash of a Saab 340B, labor disputes with pilot and flight attendant unions, and turmoil at the group level, Crossair posted an operational loss of $15 million last year.

However, this year’s operating statistics reflect the company’s efforts to improve its position after a near disastrous showing in 2000. During the first six months of this year the airline carried 1.5 million passengers on its own scheduled services, 6 percent more than in the same period last year. Load factor improved from 49 to 53 percent, and average yield per passenger increased by 2 percent. Total traffic decreased by one percent to 2.9 million passengers due to reduced seat capacity. Revenue from flight operations rose by 6 percent to nearly $390 million, slightly below target.

Crossair’s new CEO, André Dosé, hopes to end the year with a better financial result while continuing the extensive fleet renewal begun during Moritz Suter’s tenure. In an official statement, the airline blamed last year’s loss on high fuel prices combined with a strong U.S. dollar and downward pressure on ticket prices. Measures taken came too late to prevent last year’s loss but, despite another losing semester, the situation is progressively coming under control, according to Dosé.

Crossair offers new scheduled flights from Geneva to Barcelona, Warsaw, Casablanca and Tunis, while Helsinki and Seville connect with the airline’s Basel “EuroCross” hub. Crossair promotes its Basel hub as a speedy alternative to large hubs like Frankfurt, London or Paris. The airline has 1,500 daily “jumps” to 42 European destinations through Basel.

During the first half of this year Crossair signed new agreements with its pilot and flight attendant unions, developments that should prevent any further labor disputes until the end of 2004.

The company that brought back propeller airliners to Switzerland in 1979 (Fairchild Metroliners), now plans to fly an all-jet fleet by 2006. Crossair currently operates 77 airplanes. All of its Saab 340 and Saab 2000 turboprops are scheduled to be replaced by 25 Embraer ERJ-145s, 30 ERJ-170s and 30 ERJ-190s at its Basel facility. Crossair expects delivery of its first 70-seat ERJ-170 late next year, and the first 108-seat ERJ-190 in early 2004.

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