New regional subsidiary to be established

2 May 2003

SWISS will announce the creation of a new regional subsidiary at its media conference today. The Swiss International Air Lines Board of Directors intends to spin off the airline’s regional operations into a separate entity operating under the “Swiss Express” name. The action is being taken in response to new market conditions to offer low-cost air connections, especially within Europe. Swiss Express should commence operations with the start of the 2003/04 winter timetable period.

Further topics to be presented at the conference will include additional tactical and strategic actions being taken by the airline, including cost economies on the personnel front.

SWISS’s liquidity amounted to CHF 861 million at the end of the first quarter of 2003. The company expects to have liquidity of CHF 500 million by the end of the year, even without additional measures or new credit facilities. There is no question of the airline being grounded.

Note to editors: SWISS will not comment further or provide any interviews for radio or TV until the media conference begins.