Swiss President Mr Moritz Leuenberger yesterday ruled out another state bailout for the country's ailing airline industry unless the private sector does its part to help end a national aviation crisis.
The president, who is also transport minister, was speaking amid a scramble to find backers for a four-billion Swiss franc (€2.7 billion) rescue package floated on Sunday that would allow regional carrier Crossair to absorb two-thirds of Swissair and emerge as the national airline.
At stake is reviving the Swiss airline sector, which needs billions of dollars in fresh capital to preserve a full-fledged international service from a Swiss hub.
On Sunday, Crossair chief executive Mr Andre Dose pitched the plan for rescuing parts of its former parent airline to a task force of government officials, top bankers, aviation industry executives and unions.
Mr Dose said he still favoured a scheme for a smaller but healthier Crossair to acquire 26 short-haul and 26 long-haul planes from Swissair.
However, he said it could start operating the long-haul routes only by the end of March, not from October 28th as first planned.
That means someone - presumably the Swiss government - would have to come up with the SFr1 billion or more needed to keep the long-haul fleet flying through March.
Mr Leuenberger said it was "not clear at all" that the cabinet would agree to inject more emergency funds into Swissair, which got SFr450 million from the government earlier this month after a cash crunch grounded its entire fleet for two days.
He said the cabinet would discuss the issue at its meeting tomorrow, but not take a definitive decision until experts had a chance to review the rescue plan in detail.
Despite government lobbying, the private sector has been reluctant to pump funds into the airline sector.
Sixteen members of the executive committee of the national chamber of commerce, met yesterday to discuss the situation.
Business leaders also met Mr Leuenberger and the Swiss finance and foreign ministers on Sunday night.
Leading Swiss banks UBS and Credit Suisse Group hammered together a SFr1.4 billion rescue plan on October 1st and mandated Mr Dose to draw up a detailed business plan.
The banks bought Swissair Group's 70.4 per cent Crossair stake.
Spain's biggest airline Iberia said yesterday that it planned to reduce capacity by 11 per cent and cut costs in a bid to offset the slump in business since the September 11th attacks on the United States.
The airline plans to cut costs by nine billion pesetas in 2002, rising to Pte18 billion in 2003, according to a note sent to the securities market regulator.
Iberia said job cuts in the 29,000-strong workforce would be in line with the drop in capacity, but gave no specific number.
Aircraft and crew operated on lease - three from Air Europa and two from Air Atlanta - would be returned and new planes due for delivery next year would be postponed, the statement said.
