1950s: Go big or go home
It was a brand new decade, the 1950s. The war years were finally over, replaced by the boom years and the reconstruction of Europe. The new SAS – a joining of forces on transatlantic flights between a Danish, a Norwegian, and a Swedish airline – was off to a good start. In just a few years, the company had put together a crew that could handle the expansion, with flights to New York, Montevideo, Calcutta and elsewhere.
The natural next step was to expand the joint venture to cover all routes. In other words, it was time to bring everything under the same roof and create one of the biggest airlines in the world. The rationalization of operations would also lead to a savings of about SKr12 million (in 2015 kronor, about SKr220 million, or €23 million).
However, it turned out to be a little more difficult than one might expect.
The Norwegian media launched an anti-SAS campaign, at least according to the Swedish papers. The points of contention had to do with the division of power in the new company. The CEO’s position was earmarked for P.A. Norlin, who had been SAS’s CEO at the founding of the company but who had since joined ABA, the Swedish airline that had made one-third of SAS. Also, the Norwegians didn’t like the fact that the new company was set to have its headquarters in Stockholm, while “all the experts agree that Copenhagen would be the best choice,” Svenska Dagbladet wrote in October 1950, quoting Norway’s Verdens Gang.
Whether Norway was serious about pulling out is uncertain, but it took a series of negotiations at the highest levels of the three governments to get the issues straightened out.
The Swedes and the Danes knew that they needed Norway, even though the Norwegians played on the idea of their being the fifth wheel. Had Norway pulled out, the airline would have lost a part of its fleet and probably couldn’t have served all its destinations.
According to media reports, alternative plans were put together in Norway, and competing airlines had said they would cooperate with a newly independent Norwegian DNL airline.
In late October 1950, a summit was to be held in Sola outside Stavanger, Norway, with the ministers of transportation of all three countries ready to hammer out a deal: Sweden’s Torsten Nilsson, Norway’s Nils Langhelle, and Denmark’s Frede Nielsen. Denmark and Norway also had their finance ministers, Viggo Kampmann and Olav Meisdalshagen, respectively, ready to go to in Sola. Sweden had planned to have Norlin and banker Marcus Wallenberg take part in the negotiations as well.
The meeting had to be postponed due to a cabinet crisis in Denmark, but when they did meet 10 days later, the three ministers came to the conclusion that there was only one way to make the company more profitable and effective: further expansion.
“The ministers concluded that it would be best for each individual country and Scandinavia as a whole if there was one airline that could compete with the overseas companies,” wrote Svenska Dagbladet. The article was titled, “Ministers agree fully on SAS in Oslo.”
The ministers decided to recommend ratification of the agreement to their respective cabinets. The parliaments voted yes, and in February SAS got a monopoly on international air traffic from Scandinavia, while the three domestic airlines shut down their operations.
The new company had its headquarters in Stockholm, and Norlin was the new CEO.
Almost immediately after the ratification of the agreement, the new company announced it was planning a massive investment program worth SKr130 million (about SKr2 billion today) to order seven new DC-6B aircraft and 20 Convair 440s.
Go big or go home.
Published: February 4, 2016