In November 2020, Norwegian Air filed for bankruptcy protection. The board of directors of the company today outlined a simplified business structure and no longer includes long haul.
Norwegian will no longer fly 787 aircraft
The entire Boeing 787-9 long Hell fleet of Norway has been put under fire since March 2020 due to travel restrictions as well as a general decline in demand. With future demand remaining highly uncertain, the company believes that a long haul network is no longer viable. That means Norwegian will no longer chase long haul flight, and will get rid of its Boeing 787.
Unfortunately, this also means that long-standing staff, primarily in Italy, France, Britain and the United States, have approached bankruptcy practitioners.
Norwegian states that it “will continue to assess profitable opportunities as the world adapts and recovers from the impact of COVID-19.” Given that the airline had not been making money on pre-coronaviruses flying for a long time, I have a hard time imagining that it would return.
Norway will dump its 787 fleet
Norwegian will focus on European network
With its newly simplified business structure, Norwegian will focus on its European functions. The hope is “to build a strong and solid company that will attract investors and continue to serve new and existing customers.”
The company will focus on its core Nordics business, specifically operating a short haul network with narrow body planes. Within Norway, the focus will be on major European destinations across and across the Nordics.
The plan is to serve these markets by 2021 with about 50 narrow body planes, and by 2022 to increase that number to about 70 narrow body planes.
Norwegian is aiming to reduce debt to around $ 20 billion, and to raise up to 4-5 billion in new capital through the issue of rights to current shareholders, a private placement and a hybrid instrument. The company has once again begun talks with the government of Norway about possible state involvement on the new business plan.
Norwegian will focus on its European network
This development is inevitable but sad
I have two different techs here.
First, it is a sad development for consumers. Norwegian offered possibly the best passenger experience of any low-cost carrier across the Atlantic – the 787 was modern, had WiFi, and was a solid premium economy product. This was a real value-add for consumers across the Atlantic, too bad it was not equally beneficial to the company. 4
Even for those who did not actually fly with the Norwegian, there is no denying that the Norwegian contributed fares to the lower part of the Atlantic.
Then there is another point – Norway hangs with a thread. The airline was already struggling with the epidemic, and the company is on the verge of more liquidation than it can count. The ownership structure of the company has completely changed at this point, and the company has large scale debt.
So while it is a gloomy development, I think I have been hoping for months that the company cannot survive very well, let alone that it will conduct long haul flight.
Operating the 50–70 aircraft still seems optimistic, with a focus on the Nordic over the next few years, so we’ll see how that plays out.
787 Premium Economy of Norwegian Air
As part of its new business plan, Norwegian Air will abandon its long-term operations, and may even get rid of its 787s. It has not been nearly a year to these aircraft, and the airline knows that if it is going to survive, a long haul flight is not part of that business model. Instead Norway will focus on flying within Europe, with a particular focus on Norwegian.
Are you sad to see Norway take a long flight?