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Wednesday, January 27, 2021

No More Cheap Transatlantic Hops – Norwegian Moves To Short Haul

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Long-haul low-cost legend Norwegian is set to ditch the long-haul side of its business as part of its ongoing restructuring process. The airline has said today that it is in talks with the government about possible aid, and will return to its roots as a short-haul European carrier.

Norwegian Air UK Boeing 787-9 Dreamliner G-CKOF (1)
No more long-haul for the new Norwegian. Photo: Vincenzo Pace | JFKJets.com

Back to short-haul for Norwegian

Low-cost airline Norwegian has today revealed that it will not return to long-haul flying. The carrier is looking to go back to its roots, with a move to emerge from its restructuring process as a European short-haul airline only.

According to a statement from the airline, it will only operate around 50 narrowbody aircraft in 2021, with a plan to increase this to 70 in 2022. The news doesn’t come as a complete surprise, as the airline was noted to have flown at least six of its 787 Dreamliners to Ireland for lessor repossession last week.

CEO of Norwegian, Jacob Schram, commented,

“Our short haul network has always been the backbone of Norwegian and will form the basis of a future resilient business model.

“I am pleased to present a robust business plan today, which will provide a new start for the company. By focusing our operation on a short haul network, we aim to attract existing and new investors, serve our customers and support the wider infrastructure and travel industry in Norway and across the Nordics and Europe.”

Norwegian 737
The airline will focus on a short-haul European network. Photo: Norwegian

The airline is seeking to raise some five billion kroner (around $590 million) through a new rights issue, a hybrid instrument and a private placement. This is the latest development in its restructuring process, being conducted under Irish examinership.

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Thousands of jobs to be lost

The airline will be making cuts to its staff in the UK, France, Italy, Spain and the US. The Independent has assessed that some 1,100 UK crew will be made redundant, and that similar levels of jobs are at risk in the other countries too. Schram further commented,

“Our focus is to rebuild a strong, profitable Norwegian so that we can safeguard as many jobs as possible. We do not expect customer demand in the long haul sector to recover in the near future, and our focus will be on developing our short haul network as we emerge from the reorganization process.

 “It is with a heavy heart that we must accept that this will impact dedicated colleagues from across the company. I would like to thank each one of our affected colleagues for their tireless dedication and contribution to Norwegian over the years.”

Norwegian 737-800
Thousands of jobs will be lost at its bases around Europe and the US. Photo: Norwegian

The rise and fall of Norwegian

Norwegian has made a name for itself as one of the cheapest ways to cross the Atlantic. With modern 787 Dreamliners, the airline forged a path connecting busy airports like Gatwick with US hubs, including New York and Los Angeles. It changed the game for European fliers, and spurred the impetus for new competitors to emerge; competitors like WOW and Primera.

The fate of WOW and Primera was sealed a long time before COVID. But Norwegian was struggling too. It entered the pandemic as one of the most debt-burdened airlines in Europe. Despite an initial bailout from Oslo, many believed that the carrier would not survive.

Now, it seems Norwegian is going the same way. Many have said that long-haul, low-cost is not a model that works, and there has been much speculation that Norwegian would emerge as a much smaller, short-haul focused airline. With that confirmed, we await the final restart of Norwegian and the shape the carrier will take.



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