Editing Swissair (section)

== History ==
[[File:Mittelholzer-fokker.jpg|thumb|200px|Swissair [[Fokker F.VII]]b-3 m (CH-192) piloted by [[Walter Mittelholzer]] in [[Kassala]] (Sudan), February 1934]]

=== Founding years ===
On 26 March 1931, Swissair – Schweizerische Luftverkehr [[Aktiengesellschaft|AG]] (English: ''Swissair – Swiss Air Transport'') was founded through the fusion of the airlines [[Ad Astra Aero]] (founded in 1919) and [[Balair]] (1925). Balz Zimmermann and the Swiss aviation pioneer [[Walter Mittelholzer]] were the founding fathers. In contrast to other airlines, it did not receive support from the government. The name "Swissair" was the proposal of Dr Alphonse Ehinger, president of the directorial board of Balair, although "Swissair" was first deemed "un-Swiss". In the first operational year, 64 people were employed, including ten pilots, seven radio operators, and eight mechanics. Their planes offered 85 seats, and operation was maintained only from March to October. The route network had a length of {{convert|4203|km|mi}}.

[[File:Swissairlogo40.png|thumb|The first Swissair logo]]

On 17 April 1932, Swissair bought two [[Lockheed Model 9 Orion|Lockheed Orion]]s, making them the second European airline to use American planes after the Czechoslovak operator [[Czech Airlines|CSA]] purchased a Ford Trimotor in 1930. The Orion was the fastest commercial aeroplane of its time and was put to use on the "Express Line", [[Zürich]]-[[Munich]]-[[Vienna]]. This led [[Deutsche Luft Hansa|Lufthansa]] to ask [[Heinkel]] for a model that could top Orion's speed, leading to the [[Heinkel He 70 Blitz|Heinkel He 70]]. The first trans-Alpine route was introduced in 1933: Zürich-[[Milan]].

For the first time in Europe, flight attendants were employed aboard the [[Curtiss T-32 Condor II|Curtiss Condor]] beginning in 1934. [[Nelly Diener]], the first flight attendant in Europe, became world-famous. She was killed after just 79 flights in a crash near Wurmlingen, Germany, on 27 July 1934. The cause of the crash was [[Fatigue (material)|material fatigue]].

In 1936, [[Douglas DC-2]]s were acquired, and London was added to the route network. In 1937, the bigger [[Douglas DC-3]] was bought. In the same year, both founding fathers died: Walter Mittelholzer died while [[mountaineering]] in [[Steiermark]], Austria, and Balz Zimmermann succumbed to an infectious disease.

[[File:Erster Direktflug London - Samedan mit der Douglas DC-2-115-D, HB-ISI 1938.jpg|thumb|A Swissair DC-2. They would become a very loyal customer of Douglas, buying most of their commercial aircraft models.]]

On 27 August 1939, days before World War II broke out, the airspace over Germany and France was closed. Swissair was forced to suspend service to Amsterdam, Paris, and London. Two days later, the Swissair service was closed completely. Of 180 employees, 131 had to serve in the army. Despite the war, some routes were later re-introduced, such as Munich, [[Berlin]], [[Rome]], and [[Barcelona]]. In 1940, an invasion of Switzerland was feared, and Swissair moved their operations to the [[Magadino]] Plains in [[Ticino]]. Operations were suspended in August 1944, when a Swissair DC-2 was destroyed in [[Stuttgart]] during an American bombing raid.

On 30 July 1945, Swissair was able to resume commercial aviation.<ref name="Keimzelle">This section was translated from the article "Swissair" in the German-language Wikipedia, version [http://de.wikipedia.org/w/index.php?title=Swissair&oldid=57102269]</ref>

=== Ascension ===
[[File:Swissair-Aktie von 1947.jpg|left|thumb|Swissair share, issued 17 April 1947]]
[[File:Convair 240 HB-IRV Swiss Air Lines Ringway 25.03.50.jpg|thumb|A Swiss Air Lines Convair 240 at [[Manchester Airport]], England, in March 1950]]
[[File:SR DC3.jpg|thumb|200px|A Swissair Douglas DC-3 in the 1950s]]
[[File:Douglas DC-6B HB-IBE Swissair Ringway 30.07.54 edited-2.jpg|thumb|right|A Douglas DC-6B at Manchester Airport in 1954]]

In 1947, the rise of shareholder capital to {{FXConvert|CHE|20|m|cursign={{CHF|link=yes}}|year=1947|showdate=no|index=CH}} enabled long-haul flights to New York, South Africa, and South America with [[Douglas DC-4]]s. The modern [[Convair CV-240 family|Convair 240]], the first Swissair plane with a pressurised cabin, was used for short and medium-range flights starting in late 1948. The first Swissair DC-4 flight to New York was routed via [[Shannon Airport|Shannon]], Ireland, and [[Stephenville, Newfoundland and Labrador|Stephenville, Newfoundland]], on 2 May 1947. However, it ended in [[Washington, D.C.]], due to fog at New York's [[LaGuardia Airport]]. The total elapsed time was 20 hours and 55 minutes.

[[File:Swissair98.jpg|thumb|The former Swissair logo]]

The public, including the federal government, cantons, municipalities, the Swiss Federal Railways, and the Swiss postal services, took over 30.6% of the shares and enabled Swissair to get a credit of 15&nbsp; million Swiss Francs to purchase the airline's first two [[Douglas DC-6]]B airliners for delivery in 1951. By that act, Swissair became Switzerland's national [[flag carrier]]. The new pressurised aircraft was to replace the DC-4 on transatlantic routes.

In 1948, the airport in Dübendorf, which had served as the base of Swissair, was relocated to Zürich-Kloten. Military aviation continued in Dübendorf. The next year, Swissair plunged into a financial crisis due to a sudden devaluation of the British pound because fares, except for traffic to the United States, were calculated in British currency. At that time, traffic to England made up 40 per cent of Swissair's revenue.

In June 1950, Walter Berchtold, manager of Swiss Federal Railways, was elected to the directorial board of Swissair and served as the director. In 1971, he created the corporate culture of Swissair. He grasped the importance of corporate image and corporate identity and after the example of [[British Overseas Airways Corporation|BOAC]]'s "[[Speedbird]]", he introduced the arrow-shaped Swissair logo. Giving flight personnel a distinct uniform was also an important move. At the time, flight attendants' uniforms resembled the grey-blue ones of the Swiss [[Women's Army Corps]], so Berchtold introduced ones in a modish marine blue. Swissair initiated a veritable fashion competition among European airlines.

{{Rail freight
|float=left
|title=Revenue passenger-kilometers, scheduled flights only, in millions
|1950|147
|1955|465
|1960|1138
|1965|2436
|1971|5001
|1975|7562
|1980|10831
|1985|12609
|2000|34246
|source=ICAO Digest of Statistics for 1950–55, IATA World Air Transport Statistics 1960–2000
}}
[[File:SR DC7.jpg|thumb|left|Douglas DC-7C (1957)]]

In 1952, the cabin layout on northern trans-Atlantic routes was changed to one with a first and a tourist (economy) class. The first-class cabin had comfortable chairs in which one could sleep, given the name "Slumberettes". Those sleeping chairs were soon succeeded by beds, modelled after the US [[Pullman (car or coach)|Pullman railway cars]]. Two adjacent seats were moved towards each other and formed a lower berth. The wall panel could be folded downward, forming the upper berth in which the other person could sleep. A year later, a [[Economy class|tourist class]] cabin was introduced on intra-European flights.

In 1953, Swissair, with the city of [[Basel]], founded a charter company called [[Belair (airline)|Balair]], reusing the name of one of its predecessors, a company that initially used older Swissair aircraft to fly to holiday destinations.

As the first European customer, Swissair bought the [[Douglas DC-7]]C which enabled the company to provide non-stop flights to the United States. For shorter-range routes, the [[Convair Metropolitan]] was used.

In 1957, the [[Far East]] was added to the route network. Direct flights to [[Tokyo]] had intermediate stops in [[Athens]], [[Karachi]], [[Mumbai|Bombay]], [[Bangkok]] and [[Manila]]. That same year, Swissair helped [[Aristotle Onassis]] form the new Greek airline, [[Olympic Airways]].

While competitors first looked at [[turboprop]] aeroplanes to replace their piston-engined craft, Swissair introduced jet aeroplanes. Together with SAS, Swissair bought [[Douglas DC-8]]s, which were delivered beginning in 1960. For medium and short-range routes, the [[Sud Aviation Caravelle]] was purchased. The aircraft were maintained in concert with SAS, and manuals for operation and maintenance were co-written.

[[File:Douglas DC-8-62 HB-IDE SWR ZRH 22.04.79 edited-2.jpg|thumb|right|[[Douglas DC-8|Douglas DC-8-62]] of Swissair at Zurich Airport in 1979. The DC-8 series served the airline from 1960.]] 
[[File:Convair 990A HB-ICC Swissair Ringway 07.64 edited-3.jpg|thumb|Swissair Convair Coronado 990A (1962–1975)]]

Swissair was one of the few companies to order the [[Convair 990 Coronado]] for its medium and long-range routes. Although the aircraft did not initially fulfil contractual specifications, they were liked by employees and customers. They operated on the airline's routes to South America, West Africa, and the Middle and Far East.

1966 saw the introduction of the [[McDonnell Douglas DC-9|Douglas DC-9]]. That aircraft became the backbone of the short and medium-range routes, and, after convincing [[Douglas Aircraft Company|Douglas]], which soon merged with [[McDonnell Aircraft Corporation|McDonnell Aircraft]] to create [[McDonnell Douglas]], ultimately merged with [[Boeing]], offered a stretched variant: the DC-9-32. For the first time, Swissair was the launch customer of an aircraft type.

In 1971, Armin Baltensweiler took over as president of the directorial board and ran the enterprise for over two decades. In the same year, the first [[Boeing 747|Boeing 747-200]] jumbo jet was acquired, and in the next year, the first McDonnell Douglas [[DC-10-30]] followed. Both types shaped the long-haul fleet until the 1990s. Again, the specifications of both aircraft were developed in collaboration with SAS. Also in 1972, Switzerland introduced a prohibition of night flights, which led to the cessation of cheaper night fares.

[[File:Swissair Boeing 747-200 Marmet.jpg|thumb|Swissair Boeing 747-200B (1971)]]
[[File:Swissair McDonnell Douglas DC-10-30 HB-IHH "Basel-Stadt" (26090378125).jpg|thumb|Swissair McDonnell Douglas DC-10 (1972)]]

In 1973, the company struggled with severe turbulence: a currency crisis, collective chaos, an air traffic controllers' strike, the [[Yom Kippur War|October War]] and the [[1973 oil crisis|first oil crisis]] were weathered without significant damage. In the same year, the regional representative of Swissair in [[Buenos Aires]] was kidnapped by the [[Montoneros]]. After 38 days in captivity, he was released after the payment of {{FXConvert|CHE|12350714.15|cursign={{CHF|link=no}}|year=1973|showdate=no|index=CH}} ransom.<ref>{{cite news |last1=Lüchinger |first1=René |title=Secret negotiations in Argentina freed Swissair executive in 1973 |url=https://www.nzz.ch/english/secret-negotiations-in-argentina-freed-swissair-executive-in-1973-ld.1653226 |access-date=1 November 2023 |work=[[Neue Zürcher Zeitung]] |date=3 November 2021 }}</ref> The airline also phased out the CV-990s during that time.

Swissair was the second European airline to offer service to the [[People's Republic of China]], introducing service to [[Beijing]] and [[Shanghai]] in 1975. In the same year, Swissair was the launch customer for the DC-9-51. In 1977, Swissair was the launch customer for the third DC-9 type, the DC-9-81 variant, now called the MD-80. Armin Baltensweiler had travelled to a meeting of the McDonnell-Douglas directorial board in St. Louis to convince them to further stretch the fuselage of the DC-9-51. Baltensweiler was called the "Father of the MD-80". In 1979, Swissair was the first company to order the [[Airbus A310]] and the jumbo jet variant with a stretched upper deck, the [[Boeing 747-300]]. Later on, the [[Fokker 100]] short-range aircraft and the three-engined [[McDonnell Douglas MD-11|MD-11]] were aircraft for which Swissair was the launch customer. 1983 saw the replacement of the older DC-9s with MD-83s.

Since the 1960s, Swissair has been a world leader in the development of cargo reservation systems (CRS). [[Programmed Airline Reservation System|PARS]] and [[CARIDO]] were examples of systems enabling the booking of passenger seats and freight space.<ref name="Keimzelle" />

=== "The flying bank" ===
[[File:SR Caravelle.jpg|thumb|Sud Aviation Caravelle (1961)]]

After the 1960s, air traffic increased quickly and allowed many airlines—many of which were [[monopoly|quasi-monopolists]] on their routes—to yield high revenues. Swissair profited from its well-established reputation as a quality airline and from the fact that the political neutrality of Switzerland allowed the company to fly to exotic and lucrative destinations in Africa, the Middle East, South America and the Far East. In geographic terms, the central position of Switzerland in Europe helped it generate revenue from transfer passengers. By the early 1970s, Swissair was becoming known as "the flying bank", appealing to the large [[hidden asset]]s and the huge liquidity Swissair had. Second, "flying bank" was the designation for a corporate group that cared more about financial management than about flying aeroplanes.<ref name="Keimzelle" />

With the beginning of deregulation and liberalisation in the late 1970s, airlines felt growing financial pressure. In 1978, [[Moritz Suter]] founded a regional airline named [[Crossair]], which put Swissair under additional stress. To counter these changes, Swissair invested their large financial reserves into [[takeover]]s and into flight-related trades like baggage handling, catering, aircraft maintenance, and duty-free stores. This strategy diversified economic risks at the expense of the core business of Swissair: commercial aviation.

Due to a 12-day global flight ban for the DC-10 imposed by the US [[Federal Aviation Administration]] after the crash of [[American Airlines Flight 191]] on 25 May 1979, a sizable portion of the long-haul fleet was on the ground. On October 7, after landing in Athens, [[Swissair Flight 316|a DC-8 overran the runway and caught fire]], killing 14 passengers. [[1979 oil crisis|By the end of that year, kerosene prices had doubled]], and fuel costs had increased from 12% to 16% of total costs. Swissair was the first to order the [[Airbus A310]] designed with a two-man cockpit for more traffic-tight short distances and on shorter medium distances, and accepted options for 10 more units. Another Boeing 747 was ordered. Dublin was added to the route network as a new destination, but service to Beirut had to be discontinued in mid-July due to the political turmoil in Lebanon.

Swissair was able to outperform the competition in a year that experts deemed to be the worst in the history of civil aviation. In contrast to other airlines, which began to offer a second-tier [[Business class|executive class]], the proven cabin division into first and economy classes was maintained. The short-haul fleet was renewed with the [[MD-81]] (DC-9-81) introduction. This type of aircraft partially replaced the older and smaller DC-9. In addition, modern, fuel-saving aircraft, such as five new Boeing 747s with extended upper decks and two DC-10-30s with a longer range, were ordered. With the connection of Zurich Airport to the national railway network, bus delivery services from Zürich were discontinued. Air passengers were already able to check their luggage at the rail station. The route network was expanded with service to Jakarta, but flights to Tehran and Baghdad had to be suspended after the outbreak of the Iran-Iraq war. By the end of 1980, Swissair was represented in 196 cities. New representations or points of sale were opened in Luxembourg, Ulm, Ottawa, Raleigh, Westchester, Valparaíso, Jubil, Sanaa, and Salisbury/Harare. Under the name [[Swissôtel]], the [[Hotel President Wilson|hotels Président]] in Geneva, [[Swissôtel Zürich|International]] in Zürich, [[Drake Hotel (New York City)|Drake]] in New York, and [[Hotel Bellevue Palace|Bellevue Palace]] in Bern were administratively combined.

=== Concentration ===
[[File:Swissair Boeing 747-300 at Zurich Airport in May 1985 version2.jpg|thumb|Boeing 747-300 (1985)]]
[[File:Swissair_A310-221_HB-IPA.jpg|thumb|Airbus A310-200 (1983)]]
[[File:131bf - Swissair Airbus A321-111; HB-IOE@ZRH;11.05.2001 (5588353622).jpg|thumb|Airbus A321-100 (2001)]]
[[File:103ar_-_Swissair_MD-11;_HB-IWS@ZRH;11.08.2000_(4704216519).jpg|thumb|[[McDonnell Douglas MD-11]] (2000)]]

Regarding further liberalisation of Europe's airline market, Swissair focused more on commercial aviation and extended its partnerships. As the first European airline to do so, Swissair signed in 1989 a cooperation treaty with [[Delta Air Lines]] and [[Singapore Airlines]] to create the alliance "Global Excellence". In 1990, together with SAS, [[Austrian Airlines]] and [[Finnair]], the "European Quality Alliance" was founded. The last alliance was later renamed "The [[Qualiflyer]] Group".

Because of the weak economy, the [[Gulf War]] and its aftermath, and rising operational costs, many airlines lost money in 1990 and 1991. Additionally, the ongoing liberalisation of the industry strengthened competition. Consequently, Swissair lost 99&nbsp;million Swiss Francs in the first half-year and could not pay dividends to its shareholders. In 1991 and 1992, Swissair had to utilise financial reserves to cushion significant losses from the commercial aviation sector.

On 1 January 1991, commercial aviation in Europe was completely liberalised, and existing capacities led to aggressive competition among airlines. In a national referendum held on 6 December 1992, Swiss citizens rejected taking part in the [[European Economic Area]] (EEA). This referendum was a significant disservice to Swissair, an airline with a tiny domestic market: its planes were not allowed to take up passengers during intermediate landings in EEA countries (e.g., Zürich-Frankfurt-New York), and Swissair was not allowed to offer tickets for sections that fully lie in EEA member countries (e.g., Zürich-Frankfurt-Paris).<ref name=":1">{{Cite book |last1=Hamilton |first1=Stewart |url=https://www.worldcat.org/title/ocm64390595 |title=Greed and corporate failure: the lessons from recent disasters |last2=Micklethwait |first2=Alicia |date=2006 |publisher=Palgrave Macmillan |isbn=978-1-4039-8636-8 |location=Basingstoke [England] ; New York |page= |chapter=Swissair: Crashed and Burned |oclc=ocm64390595}}</ref>

''See also [[freedoms of the air]]''.

Like other airlines based in smaller countries, Swissair was now under significant pressure. More and more national airlines have affiliated themselves with airline alliances to maintain a worldwide market presence. But to be interesting for American alliance partners, an airline must have a critical size in terms of passenger numbers. To meet that goal, in 1993, an alliance between Swissair, KLM, SAS, and Austrian Airlines was proposed. This project bore the name "[[Alcazar (airline)|Alcazar]]" to create a single Central European airline. However, in various countries, this project was criticised. In Switzerland itself, it was thought that the huge financial assets were too precious to sacrifice to merge Swissair with the other airlines.<ref name="Keimzelle" /><ref name=":1" />

===Hunter Strategy===
[[File:SAirGroup.png|thumb|300px|Logos of the firms belonging to the SAirGroup]]

In the late 1980s and early 1990s, Swissair tried to merge with [[Air France]], [[Lufthansa]], and [[British Airways]] to get access to a wider European market. Finally, after deregulation, Swissair tried to expand beyond its home market; after the Alcazar project was cancelled, Swissair aimed to be a major force in European aviation.

In the mid-1990s, Swissair initiated the disastrous "Hunter Strategy", a major expansion programme devised by the US consulting firm [[McKinsey & Company|McKinsey & Co]]. Using this strategy, Swissair aimed to grow its market share by acquiring small airlines rather than entering into alliance agreements. Swissair decided to acquire 49.5 per cent of the very successful Italian charter airline Air Europe, the unprofitable [[Belgium|Belgian]] flag carrier [[Sabena]], and significant stakes in the carriers [[Air Liberté]], [[AOM French Airlines|AOM]], [[Air Littoral]], [[C.A.I. Second|Volare]], [[LOT Polish Airlines|LOT]], [[Turkish Airlines]], [[South African Airways]], [[Portugália Airlines|Portugália]] and [[LTU International|LTU]], and planned to acquire stakes in [[Aer Lingus]], [[Finnair]], [[Malév Hungarian Airlines|Malév]], as well as Brazilian carriers [[LATAM Airlines Brasil|TAM]] and [[Transbrasil]].<ref>{{cite news|title=Swissair gets purchase approval|url=http://www.thefreelibrary.com/Swissair+gets+purchase+approval.-a061544648|access-date=30 August 2012|newspaper=Airline Industry Information|date=17 April 2000}}</ref> By mid-2000, it was predicted that Swissair would lose between {{FXConvert|CHE|3.25|b|year=2000|index=CH|showdate=no|cursign={{CHF|link=no}}}} and {{FXConvert|CHE|4.45|b|year=2000|index=CH|showdate=no|cursign={{CHF|link=no}}}} over the next three fiscal years. The management, however, maintained classical restructuring,{{clarify|date=May 2023}} and the Board approved the reorganisation of LTU for approximately {{FXConvert|CHE|500|m|year=2000|index=CH|showdate=no|cursign={{CHF|link=no}}}}. Also, there were plans to take over [[Alitalia]].<ref>{{cite news |last1=Hollingdale |first1=Michael |date=19 September 2000 |title=Alitalia reportedly in alliance talks with Swissair |language=en |work=[[swissinfo]] |url=https://www.swissinfo.ch/eng/alitalia-reportedly-in-alliance-talks-with-swissair/1665302 |access-date=29 June 2023}}</ref><ref name=":1" />

In October 1999, [[Delta Air Lines]] cancelled its transatlantic Atlantic Excellence alliance with Swissair and [[Sabena]], citing the desire to partner with [[Air France]] instead.<ref>{{Cite web |last= |first= |date=1999-10-13 |title=Swissair, Delta, Sabena, Austrian end trans-Atlantic alliance |url=https://www.swissinfo.ch/eng/banking-fintech/swissair-delta-sabena-austrian-end-trans-atlantic-alliance/1366722 |access-date=2024-07-07 |website=swissinfo |language=en-GB}}</ref>  

During the European airline deregulation transition, [[Jeffrey Katz (executive)|Jeffrey Katz]] served as CEO of Swissair from 1997 to 2000, a period of increased fuel prices and industry [[overcapacity]].<ref>{{Cite web |last=swissinfo.ch |first=S. W. I. |date=2000-07-06 |title=Swissair considers future after Katz blow |url=https://www.swissinfo.ch/eng/banking-fintech/swissair-considers-future-after-katz-blow/1556544 |access-date=2024-02-22 |website=SWI swissinfo.ch |language=en-GB}}</ref>

In the summer of 2000, SAir's CEO Philippe Bruggisser came under public pressure as the press published the group's financial situation. Swissair and Sabena were each losing one million francs per day, and another million were lost every day at LTU and the French investments. For the first time, the board began to consider scenarios for phasing out its existing participation in other airlines as Swissair looked to withdraw from its foreign investments.<ref name="nytimes">{{cite news|last1=Olson|first1=Elizabeth|title=Chief Steps Down at Parent of Swissair|url=https://www.nytimes.com/2001/01/24/business/chief-steps-down-at-parent-of-swissair.html|access-date=17 August 2017|work=The New York Times|date=24 January 2001}}</ref> In January 2001, Bruggisser was summarily dismissed. Moritz Suter, the founder of Crossair, was nominated as the new CEO of SAirLines and thus all Group airlines, including Swissair. After only 44 days in charge, Suter resigned.<ref name="nytimes" /><ref name=":1" />

In March 2001, two studies by consultants were presented to the board, which showed the financial difficulties of SAirGroup. At this point, the directors resigned, with only [[Mario Corti (manager)|Mario Corti]], the former [[Chief financial officer|CFO]] of [[Nestlé]], remaining. From April to August 2001, the group's [[Moody's Ratings|Moody's credit rating]] was gradually downgraded from A3 to B1 (it was downgraded further to B2 on September 18th).<ref>{{Cite web |title=Swissair Group {{!}} Reports {{!}} Moody's |url=https://www.moodys.com/credit-ratings/Swissair-Group-credit-rating-600051588/reports?category=Ratings_and_Assessments_Reports_rc%7CIssuer_Reports_rc&type=Rating_Action_rc,Credit_Opinion_ir_rc%7CIssuer_Reports_rc |access-date=2024-03-24 |website=www.moodys.com}}</ref> The buying spree created a major [[cash flow]] crisis for parent company SAirGroup and was exacerbated by the environment caused by the [[September 11 attacks]]. Unable to make payments to creditors on its large debt, and with the refusal of [[UBS]] to extend its line of credit, on 2 October 2001 the entire Swissair fleet was abruptly grounded.<ref>{{cite news | author=Staff writers | url=http://news.bbc.co.uk/1/hi/business/1574658.stm | title=Swissair grounds all flights | work=BBC News | date=2001-10-02 | access-date=2007-08-02}}</ref><ref name=":1" /> Many blamed UBS for the fiasco, causing demonstrators to take to the streets with signs referring to UBS chairman [[Marcel Ospel]] as "''Bin Ospel''", quoting [[al-Qaeda]] leader [[Osama bin Laden]], and redefining the bank's acronym, "UBS", as the ''United Bandits of Switzerland''.<ref>{{cite news |last1=Richter |first1=Patrick |title=The collapse of Swissair |url=https://www.wsws.org/en/articles/2001/10/swis-o13.html |access-date=29 June 2023 |work=World Socialist Web Site |date=13 October 2001 |language=en}}</ref>

Two large [[bridge loan]]s from the Swiss government were required to finance the continuation of flight operations.  This notwithstanding, with the resumption of flight service, it was necessary for flight crews to carry large sums of cash to purchase fuel at foreign airports.<ref>[http://news.bbc.co.uk/1/hi/business/1581662.stm BUSINESS | State warned against buying Swissair]. BBC News (2001-10-05). Retrieved on 2013-08-20.</ref>

===Grounding===
On 1 October 2001, Project "Phoenix" was announced, under which parts of the group sought a payment delay. The Swiss federal authorities were willing to pay back half of the loan, so they secured the continuation of service.

2 October 2001 saw an increased necessity for strong liquidity, as all suppliers insisted on cash payments of outstanding invoices following a request for payment delay announced the day before. The company's cash reserves filed on that day were barely sufficient to carry out the first morning flights. During the morning, fuel suppliers refused to fuel the waiting aircraft. At 15:45 [[Central European Summer Time|CEST]], CEO Mario Corti announced a cessation of flight operations due to the security risks caused by the crossing of the Flight Duty Regulations.<ref>{{cite news |date=2 October 2001 |title=Swissair jets grounded as cash runs out |url=https://edition.cnn.com/2001/BUSINESS/10/02/swissair/ |work= |publisher=[[CNN]]}}</ref>{{clarify|date=May 2023}} This led to the cancellation of over 230 flights, and thousands of passengers, as well as flight crews, were stranded around the world. Flight crew corporate credit cards were blocked by the banks, with some hotels expelling the crew, and having them return home at their own expense. All tickets sold were voided.<ref>{{Cite news |last1=Milner |first1=Mark |last2=Harper |first2=Keith |last3=Clark |first3=Andrew |date=2001-10-03 |title=Financial crisis grounds Swissair fleet |url=https://www.theguardian.com/business/2001/oct/03/theairlineindustry.internationalnews |access-date=2024-04-20 |work=The Guardian |language=en-GB |issn=0261-3077}}</ref><ref name=":2">{{Cite web |last= |first= |date=2001-10-02 |title=Crossair to fly the flag as Swissair gives up the struggle |url=https://www.swissinfo.ch/eng/banking-fintech/crossair-to-fly-the-flag-as-swissair-gives-up-the-struggle/2282548 |access-date=2024-04-20 |website=swissinfo.ch |publisher=[[Swiss Broadcasting Corporation]] |language=en-GB}}</ref><!--Crossair shares were only reissued on the evening of 2 October due to the rewriting of Crossair shares, with their purchase price not arriving until the following day – the setting of flight operations – into the SAirLines account.-->

4 October 2001 saw demonstrations by former Swissair employees before the UBS presentation held in Glattbrugg, and the following day saw demonstrations in [[Bern]]'s Federal Square.{{citation needed|date=May 2023}}

At around the same time, SAirGroup's stake in Crossair was sold to the Swiss banks [[UBS]] and [[Credit Suisse]]. Furthermore, Crossair took over various assets of former Swissair, including its employees, aircraft, and most European routes. Swissair and the SAirGroup were handed over to the liquidation firm of Jürg Hoss and ceased operations on 31 March 2002. Crossair was renamed [[Swiss International Air Lines]], or Swiss for short, and took over Swissair's intercontinental routes on 1 April 2002, officially ending 71 years of Swissair service.

==== Controversy surrounding Corti's decision to ground flights ====
An investigation by the Zurich branch of [[Ernst & Young]] into factors behind the grounding revealed that <blockquote>"...in contradiction to representations made by SAir Group, not just 14.5 million Swiss Francs, but around CHF50 million were available at the company's disposal on the morning of October 2, 2001".<ref name=":3">{{Cite book |url=https://www.liquidator-swissair.ch/fileadmin/_migrated/content_uploads/untersuchung1_e.PDF |title=RESULTS OF ERNST & YOUNG'S INVESTIGATION REGARDING SWISSAIR: Appendix 1 to the press release |date=January 25, 2003 |publisher=Ernst & Young |year=2003 |location=Zürich |pages=4}}</ref></blockquote> The report further stated that <blockquote>"Without the administrative inadequacies connected with the release of an [[Escrow|escrow account]], an additional CHF 73 million would have been available. Thus, overall, some CHF 123 million would have been available at SAirGroup, SAirLines, and Swissair."<ref name=":3" /></blockquote> Former Crossair executive André Dosé, who also served as the first CEO of successor airline [[Swiss International Air Lines]], stated in 2004 that this meant the grounding was not necessary and that Swissair could have likely continued flying until the financing for a successor airline would have been finalized,<ref name=":4">{{Cite web |title=André Dosé: Mario Corti, die Banken und das Grounding |url=https://www.handelszeitung.ch/unternehmen/andre-dose-mario-corti-die-banken-und-das-grounding |access-date=2024-06-25 |website=Handelszeitung |language=de-CH}}</ref> a view he reiterated in a 2021 interview.<ref>{{Cite web |date=2021-10-02 |title=20 Jahre nach dem Grounding - Ex-Swiss-Chef Dosé: «Das Grounding wäre gar nie nötig gewesen» |url=https://www.srf.ch/news/schweiz/20-jahre-nach-dem-grounding-ex-swiss-chef-dose-das-grounding-waere-gar-nie-noetig-gewesen |access-date=2024-06-26 |website=Schweizer Radio und Fernsehen (SRF) |language=de}}</ref> In his 2004 statement, Dose voiced the view that Corti and then-CFO Jacqualyn Fouse had lost oversight of Swissair's finances, accounting for this mismatch in perception of available funds.<ref name=":4" />

Mario Corti vehemently rejected the notion that Swissair and SAirGroup bank accounts together held more than 14 million Swiss francs in a public statement after the Ernst & Young report came out.<ref>{{Cite web |last=swissinfo.ch |first=S. W. I. |date=2003-01-24 |title=Swissair grounding could have been avoided |url=https://www.swissinfo.ch/eng/banking-fintech/swissair-grounding-could-have-been-avoided/3129472 |access-date=2024-06-26 |website=SWI swissinfo.ch |language=en-GB}}</ref>

===Transition phase===
On 5 October, commercial flights on most routes were gradually resumed thanks to a federal emergency loan of over CHF 450 million.<ref>{{Cite web |last= |first= |date=2001-10-04 |title=Swissair to Resume Flights With Government Funds |url=https://www.latimes.com/archives/la-xpm-2001-oct-04-fi-53107-story.html |access-date=2024-04-20 |website=Los Angeles Times |language=en-US}}</ref><ref>{{Cite web |last=Cappelli |first=Peter |title=How Swissair Landed in Trouble |url=https://knowledge.wharton.upenn.edu/article/how-swissair-landed-in-trouble/ |access-date=2024-04-20 |website=Knowledge at Wharton |publisher=[[University of Pennsylvania]] |language=en-US}}</ref><ref>{{Cite news |date=2001-10-03 |title=State rescues Swissair |url=http://news.bbc.co.uk/2/hi/business/1576636.stm |access-date=2024-04-20 |publisher=[[BBC]] |language=en-GB}}</ref> This occurred, in part, to ensure Switzerland's continued accessibility as a business location and to establish a basis for the creation of [[Swiss International Air Lines|Swiss]].<ref name=":2" /> By preventing the complete collapse of Swissair, the other airline-related businesses of the group were likewise spared collapse.<ref>{{Cite news |date=2001-10-29 |title=New threat to Swissair |url=http://news.bbc.co.uk/2/hi/business/1624688.stm |access-date=2024-04-20 |publisher=[[BBC]] |language=en-GB}}</ref>

 [[File:New Swiss International Airlines Logo, October 2011.png|thumb|The Swiss International Air Lines logo as of 2011]]

Following another federal repayable funding commitment of one billion francs, each of the 26 long-haul aircraft ([[McDonnell Douglas MD-11|MD-11]]s and [[Airbus A330|A330]]s) and 26 medium-haul aircraft ([[Airbus A321|A321]]s, [[Airbus A320|A320]]s and [[Airbus A319|A319]]s) were able to be transferred to [[Crossair]]/[[Swiss International Air Lines|Swiss]] at the end of the winter schedule of 2001/02. On Easter Monday, 1 April 2002, the last flight of Swissair, flight SR145 from São Paulo, landed in Zürich. A 71-year-long chapter of Swiss aviation history thus came to an end. Between 1931 and 2002, Swissair transported more than 260 million passengers. The SwissairGroup (the name change from SAirGroup to SwissairGroup was announced in 2001 but never officially implemented) still existed as 'SAirGroup in Nachlassstundung' ([[German language|German]]: ''Swissair in Administration'') for several years until all assets were liquidated, including a large auction where many of the remaining Swissair assets, such as historic items, were auctioned. Today, Gategourmet continues as a subsidiary of [[Gategroup]].

=== Factors behind collapse ===
Like other airlines that flew to the United States, Swissair's operations and [[Profit (accounting)|profitability]] were disrupted in the wake of the [[September 11 attacks|terror attacks against the United States]].<ref>{{cite news | author=Staff writers | title=Thousands stranded in airline crisis | url=http://news.bbc.co.uk/1/hi/world/europe/1577609.stm | work=BBC News | date=3 October 2001 | access-date=2009-03-19}}</ref>  Several politicians were among those included on Swissair's [[Board of directors]], and commentators have pointed to potential [[conflict of interest|conflicts of interest]] as fundamental to the demise of Swissair. Media have also suggested that the directorial board failed to oversee the actions of [[Philippe Bruggisser]] ([[Chief Operating Officer]] since 1996) and [[Eric Honegger]] (board member since 1993 and later board president) and that they left behind a convoluted corporate structure and financial commitments—amongst others, a further purchase of 35.5 per cent of Sabena's stock—which would only come to light when [[Mario Corti (manager)|Mario Corti]] was trying to save the airline.<ref>{{cite news|last=Olson|first=Elizabeth|title=Brussels sues Swissair in move to aid Sabena|url=https://www.nytimes.com/2001/07/04/business/brussels-sues-swissair-in-move-to-aid-sabena.html|access-date=27 September 2012|newspaper=The New York Times|date=4 July 2001}}</ref>

The [[judiciary]] is continuing to examine why Swissair acquired [[counsel]]ling that supported the Hunter Strategy and why Swissair continued to make certain payments despite nearing [[insolvency]]. Questions have also been raised about the [[federal aid]] given to Swissair and the politicians involved. The highly competitive nature of the market during the business's final years also precipitated its demise: like its Belgian counterpart [[Sabena]], Swissair fell victim to the rise of competition from [[low-cost airline|budget airlines]] on their short and medium-haul routes, such as [[Ryanair]] and [[EasyJet]].<ref>{{cite book |title=Business Studies | edition=Third |first=Dave | last=Hall |author2=Jones, Rob |author3=Raffo, Carlo | year=2004 | publisher=Causeway Press |location=Ormskirk | isbn=1-902796-83-7 | page=196 }}</ref>

Imogen Foulkes from the [[BBC]] said regarding the collapse: "Something did die in Switzerland that day: not just an airline but an image the Swiss had of themselves and, more importantly, of their business leaders"<ref name=":0" /> and "The Swiss financial community's reputation for good business sense was already seriously damaged by the Swissair disaster."<ref name=":0">{{Cite news |last=Foulkes |first=Imogen |date=2007-03-08 |title=Swiss shame over airline disgrace lingers |url=http://news.bbc.co.uk/2/hi/programmes/from_our_own_correspondent/6428019.stm |access-date=2024-04-03 |work=From Our Own Correspondent |publisher=[[BBC]] |language=en-GB}}</ref>

Because civil cases are still going on, some of the reasons why SAirGroup failed are still being looked into by the courts and have not been made clear legally. The following causes are widely recognised as crucial factors:

*The management underestimated the dangers and difficulties in the acquisitions and investments of partially ailing airlines. Therefore, the Belgian airline [[Sabena]] and German airline [[LTU International|LTU]] were acquired despite significant capital requirements. Also, investments in France ([[AOM French Airlines|AOM]], [[Air Liberté]], and [[Air Littoral]]) required much capital restructuring. Sabena ultimately ceased operations due to the aforementioned financial crisis.
*The indebtedness created by an uncompromising adaptation to the realities of "Hunter strategy" implementation and the lack of monitoring by the Board.
*The 2001 terrorist attacks in the US led to a sharp slump in demand and, consequently to an extreme tightening of liquidity.
*An orderly transfer of operations to [[Crossair]] was denied because of the failure to reach a bridging loan and the delayed transfer of the share purchase price.
*Increasing competition from low-cost carriers such as [[Ryanair]] and [[EasyJet]] in the short-to-medium-haul markets from Europe caused Swissair to lose passenger revenues.
*A full merger with Sabena was impossible due to Swissair's financial crisis.
*An MD-11, operating [[Swissair Flight 111|flight 111]], crashed in 1998, killing everyone on board. This event led to further troubles for the airline with negative publicity, a significant lawsuit, more financial problems and lowered customer confidence.

===Legacy===
In April 2002, [[Swiss International Air Lines]] commenced operations.  First called Swiss Air Lines, this company was based on the former Crossair and was a merger of Crossair and former Swissair employees, routes, aircraft, and intellectual property.<ref>{{Cite news |date=2001-10-02 |title=Debt-ridden Swissair to split with Crossair taking on flights |url=https://www.irishtimes.com/business/debt-ridden-swissair-to-split-with-crossair-taking-on-flights-1.330050 |newspaper=[[The Irish Times]]}}</ref> The company Swissair continued to exist (in liquidation) but had no further assets. Due to legal problems with Swissair, the name had to be changed to Swiss International Air Lines.

Swiss took over 26 long-haul and 26 medium-haul aircraft from the defunct Swissair fleet<ref>{{cite web |url=https://www.planetairlines.net/swiss.html |title=Planet Airlines - Swiss |website=planetairlines.net}}</ref> and refurbished the liveries and interiors to turn it into the new Swiss fleet, together with the former Crossair Fleet consisting of the Embraer 145, Saab 2000, MD-80 Series, and Avro RJ.<ref>{{Cite web|url=http://sr692.com/fleet/crossair/index.html|title=Fleet - Crossair}}</ref> The remainder of the Swissair aircraft that were grounded and were not taken by the new company were returned to their lessors.

After problems with the former Crossair pilot unions, who refused to accept different conditions than the former Swissair pilots within the same airline, a subsidiary called Swiss European Air Lines was founded, which belongs 100% to Swiss International Air Lines.

In 2003, it appeared that Swiss was going to become a member of [[Oneworld]].<ref>{{Cite web |last= |first= |date=2003-09-23 |title=Swiss joins Oneworld alliance |url=https://www.swissinfo.ch/eng/banking-fintech/swiss-joins-oneworld-alliance/3528166 |access-date=2024-04-20 |website=swissinfo.ch |publisher=[[Swiss Broadcasting Corporation]] |language=en-GB}}</ref><ref>{{Cite news |last=Tran |first=Mark |date=2003-09-23 |title=BA rescue deal keeps Swiss carrier flying |url=https://www.theguardian.com/business/2003/sep/23/theairlineindustry.money |access-date=2024-04-20 |work=The Guardian |language=en-GB |issn=0261-3077}}</ref> It had codeshares with Oneworld carriers [[British Airways]], [[American Airlines]], [[Cathay Pacific]], [[Qantas]], [[Aer Lingus]] and [[Finnair]], and held a strategic partnership and joint operation for all service to North America and AA-operated flights beyond U.S. gateways using [[American Airlines]]. Swiss started to terminate these codeshare agreements but did not terminate the AA alliance. A theory emerged that Swiss was planning to use its partnerships, the AA alliance, and its partnership with British Airways, a strong and supportive member of Oneworld, to join Oneworld itself.

However, in 2005, Swiss was taken over by [[Lufthansa]], the national airline of Germany.<ref>{{Cite web |last= |first= |date=2005-03-22 |title=Lufthansa takes over Swiss |url=https://www.swissinfo.ch/eng/banking-fintech/lufthansa-takes-over-swiss/4424174 |access-date=2024-04-20 |website=swissinfo |language=en-GB}}</ref><ref>{{Cite web |date=30 September 2011 |title=Swissair collapse still reverberates |url=https://www.swissinfo.ch/eng/swissair-collapse-still-reverberates/31250752 |website=swissinfo}}</ref><ref>{{Cite web |title=EU Gives Lufthansa-Swiss Merger Go-Ahead – DW – 07/05/2005 |url=https://www.dw.com/en/eu-gives-lufthansa-swiss-merger-go-ahead/a-1640372 |access-date=2024-04-20 |website=dw.com |publisher=[[Deutsche Welle]] |language=en}}</ref><ref>{{Cite web |date=2005-07-05 |title=Lufthansa wins EU approval for takeover |url=https://www.nbcnews.com/id/wbna8472109 |access-date=2024-04-20 |website=NBC News |publisher=[[NBC]] |language=en}}</ref> With the merger with Lufthansa, Swiss joined the [[Star Alliance]] in 2006, which Swissair planned to join before it failed. With this move, Swiss's frequent flyer club, Swiss TravelClub became part of [[Miles & More]], which was originally the Lufthansa Group frequent flyer club. It acts as both airlines' frequent flyer programme, along with many other Lufthansa Group airlines.

=== Management trial ===
A criminal trial began on 16 January 2007 in [[Bülach]].  The entire former Swissair management board stood facing criminal charges of mismanagement, false statements, and forgery of documents.<ref>{{Cite news|url=https://www.nytimes.com/2007/01/16/business/worldbusiness/16iht-swissair.4227734.html|title = Swissair trial opens with 19 executives charged - Business - International Herald Tribune|newspaper = The New York Times|date = 16 January 2007}}</ref> The top defendants in the trial were [[Mario Corti (manager)|Mario Corti]], [[Philippe Bruggisser]], George Schorderet, Jacqualyn Fouse, Eric Honegger, and [[Vreni Spoerry|Verena Spoerry]]. Corti, Honegger, and Spoerry entered statements proclaiming their innocence.<ref>{{cite news| url=http://www.iht.com/articles/ap/2007/01/16/business/EU-FIN-Switzerland-Swissair-Trial.php | title=Swissair executives assert innocence at the first day of Switzerland's biggest corporate trial | work=International Herald Tribune | author=Harry Rosenbaum | date=15 January 2007 | access-date=2007-02-22}}</ref>

On 7 June 2007, the court in [[Bülach]] cleared the defendants of all criminal charges over the airline's 2001 bankruptcy.<ref>{{cite news | author=Staff writers | url=http://news.bbc.co.uk/1/hi/business/6729261.stm | title=All Swissair defendants cleared | work=BBC News | date=2007-06-07 | access-date=2007-08-02}}</ref>

===Continued use of the "Swissair" brand===
Swiss retains the rights to the "Swissair" name, whose value was estimated at more than 10 million Swiss francs in 2010. To prevent the [[trademark]] from becoming void through disuse, Swiss licensed it to Hopscotch Air, which operates a fleet of [[Cirrus SR22]] planes in the United States, for use from 2010 to 2013. In Switzerland, the trademark is protected through its use by an aviation sports club, ''Sportfluggruppe Swissair''.<ref>{{cite news|title=Business lead |url=http://www.flightglobal.com/articles/2010/10/19/348506/business-lead.html|access-date=1 November 2010|newspaper=[[Flightglobal]]|date=19 October 2010}}</ref><ref>{{cite news|last=Keller|first=Senta|title=Swissair hebt wieder ab|url=http://www.bernerzeitung.ch/wirtschaft/unternehmen-und-konjunktur/Swissair-hebt-wieder-ab/story/22277954|access-date=1 November 2010|newspaper=[[Berner Zeitung]]|date=1 November 2010}}</ref>