NEW YORK -- Swissair received a cash infusion -- about $278 million
-- from the Swiss government that will let it resume a limited
flight operation Oct. 4, an airline spokeswoman in the U.S. said.
However, the future of the airline is still very much up in the
Because the cash-strapped carrier was unable to reach an
agreement with ARC for covering refund requests for U.S. agents,
processing of Swissair refunds and other transactions ceased with
the reporting period ending Sept. 30.
ARC told agents Oct. 3 that it will "continue to work with
Swissair toward the goal of an eventual resumption in
In the meantime, Swissair transactions included in agent sales
reports will be returned. ARC said agents could contact the airline
The airline is updating its status daily at www.swissair.com, and
advising customers to make alternate travel arrangements.
Also unclear is the fate of Sabena, Belgium's national carrier,
in which Swissair had a 49% stake. It was counting on a promised
investment by Swissair and still is dealing with a wildcat strike
by its pilots.
Sabena said Oct. 3 that it "has the necessary cash to guarantee
normal activities for the time being," but went to court asking for
bankruptcy protection as the Belgian government considered a
monthlong bridge loan to the carrier.
Swissair's collapse came shortly after its parent holding
company unveiled a restructuring plan under which two Swiss banks,
UBS and Credit Suisse, would acquire Swissair's 70% stake in
Crossair, a low-cost regional carrier, for over $600 million.
Crossair would then take over about two-thirds of Swissair
The banks also were to lend the Swissair Group $155 million to
finance the airline operations until they could be sold.
But the money did not come soon enough, a spokesman for the
airline in Zurich, Switzerland, confirmed, as Swissair was forced
to ground its fleet Oct. 2 because it ran out of cash.
Crossair, however, continues to fly, and was beginning to
operate some of Swissair's intra-European routes and to accept
Swissair tickets, subject to available space.
Swissair's cessation of services affected about 19,000
passengers on 262 flights, and stranded over 3,000 passengers at
Zurich Airport, the carrier said.
Urs Eberhard, director of Switzerland Tourism North America,
said, "We are quite worried about the latest developments and are
aware that Swissair's filing for bankruptcy protection will have
drastic effects not only on the tourism business, but also on
Switzerland's desirability as a place of business in general."
Tourism is Switzerland's third-largest export industry, Eberhard
said, generating annual sales of $8 billion. Airlines bring
Switzerland about 40% of its international guests, he added,
amounting to about 4.5 million people.
Swissair was also a major marketing partner of Switzerland
Eberhard said, "Swissair has invested a great deal of manpower
and marketing resources in promoting and positioning Switzerland as
a country for traveling, holidays and conferences. This potential
gap has to be closed in order to keep our country competitive in
the areas of holidays and travel."
Eberhard said the board will begin discussions with Crossair as
soon as possible.