Just like ae for æ.
"Ä" is a separate letter in the Swedish alphabet: https://en.wikipedia.org/wiki/Swedish_alphabet
In German on the other hand, "Ä" is part of the language but not part of the alphabet and it is simply expanded to "AE" as in the previous comment.
> In German on the other hand, "Ä" is part of the language but not part of the alphabet
Some people claim that, but I wouldn't take that as an authoritative statement. Plenty language authorities disagree, since "ä" and "ae" are not interchangeable.
> it is simply expanded to "AE" as in the previous comment
Only in some contexts (lists of names predominantly), generally "ä" is sorted after "a". E.g. the Duden dictionary goes "zahlen", "zählen", "Zahlenangabe".
However, in 2006 the arguably authorative dictionary changed to sort w after v. Gnu tools have yet to catch up with this, what I can see. :)
As an example of a conflicting locale, Swedish would have Äpfel after Käsen!