Norwegian feels the frostbite
Norwegian Air is Europe’s third largest airline and world’s fifth largest low cost airline. It has a fleet of 36 Boeing 787 aircrafts, 118 Boeing 737 aircrafts and 18 Boeing 737-8MAX aircrafts which are currently grounded. It serves around 150+ destinations and employs around 11,000 staff. Norwegian along with other airlines throughout the world has been struggling due to the rapid spread of coronavirus resulting in widespread ban on travel and restrictions.
What has happened ?
The airline is set to cancel around 3000 flights between March and Mid June. Airlines have been given a big blow due to the travel ban recently imposed by U.S on travel to Europe. U.S had announced travel restrictions on 26 European countries excluding UK, Ireland and non Schengen countries. The aviation industry has a whole has also been facing a crisis go $113 billion due to the decrease in passenger demand.
The airline has been in a tight spot such as this as recent as last year. It was also on the brink of collapse but survived the scare. It was also hit by grounding of B737 Max planes. Norwegian had 18 of them operational. Norwegian CEO Jacob Schram said in a statement “This is an unprecedented situation… the new restrictions imposed further pressure on an already difficult situation”. “We urge international governments to act now to ensure that the aviation industry can protect jobs and continue to be a vital part of the global economic recovery”. The airlines stock has also plunged by a whopping 22%.
The airline has taken some drastic steps to cope with the mounting losses incurred due to the ban and restrictions. It has decided to ground 40% of its long haul fleet and cancel upto a quarter of its short haul flights.
Norwegian will cancel the majority of its long haul flights to the U.S from Amsterdam,Madrid,Oslo,Stockhlom, Barcelona and Paris from March to the end of May. The employees were also warned in an internal note that ” to be prepared for a scenario where we reduce capacity by upto 50%”.
The only silver lining
The upper hand Norwegian has is that most of its flights to the U.S are operated out of London-Gatwick which is not impacted by the latest travel restrictions. The airline has come out and said ” we will reroute as many of our customers as possible through London during this difficult period”.