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In November 2020, Norwegian Air filed for bankruptcy. The board of directors of the company today outlined a simplified business structure, which no longer includes long-haul flights.
Norwegian will no longer fly in 787
Norwegian’s entire long-haul Boeing 787-9 fleet has been on standby since March 2020, due to travel restrictions and the general drop in demand. As future demand remains very uncertain, the company believes that a long-haul network is no longer viable. It means Norwegian will no longer continue long-haul flights and will get rid of its Boeing 787s.
Unfortunately, this also means that legal entities primarily employing long-haul staff in Italy, France, the UK and the US have contacted insolvency practitioners.
Norwegian says he “will continue to assess profitable opportunities as the world adapts and recovers from the impact of COVID-19.” Since the airline was not making money on long-haul pre-coronavirus flights, I find it hard to imagine that it will return.
Norwegian will abandon its fleet of 787
Norwegian will focus on the European network
With its new streamlined business structure, Norwegian will focus on its European operations. The hope is “to build a strong, solid business that will attract investors and continue to serve new and existing customers.”
The company will focus on its Nordic core business, operating a short-haul network exclusively with narrow-body aircraft. The focus will be on routes in Norway, the Nordic countries and to major European destinations.
It is expected to serve these markets with around 50 narrow-body aircraft by 2021 and increase that number to around 70 narrow-body aircraft by 2022.
Norwegian aims to significantly reduce its debt, to around NOK 20 billion, and raise NOK 4 to 5 billion in new capital by combining a rights issue to current shareholders, a private placement and a hybrid instrument. The company has also re-entered into a dialogue with the Norwegian government on possible state participation in the new business plan.
Norwegian will focus on its European network
This development is inevitable but sad
I have two different takes here.
First of all, for consumers, this is a sad development. Norwegian probably offered the best experience for passengers of any budget carrier across the Atlantic – the 787s were modern, had wifi, and had a solid premium economy product. It was a real added value on the other side of the Atlantic for consumers, too bad it was not equally beneficial for the company. 😉
Even for those who haven’t actually flown with Norwegian, there’s no denying that Norwegian has helped cut fares across the Atlantic.
Then there’s the other point – Norwegian is hanging on by a thread. The airline was struggling even before the pandemic, and the company has been on the brink of liquidation more times than I can count. At this point, the ownership structure of the business has completely changed and the business is in huge debt.
So while this is a sad development, I guess I had expected for months that the company would not survive at all, let alone operate long haul flights.
Running 50-70 planes with a focus on the Nordic countries for the next few years always looks upbeat, so we’ll see how that goes.
Norwegian Air Premium Economy 787
At the end of the line
As part of its new business plan, Norwegian Air will abandon its long-haul operations and also get rid of its 787. These planes haven’t flown for nearly a year now, and the airline knows that in order to survive , long-haul flights are not part of this business model. Norwegian will instead focus on flights within Europe, with a particular focus on the Nordic countries.
Are you sad to see cut long haul flights in Norway?
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