Norwegian founder hints at alliance agreements

Fresh from signing a co-operation agreement with New York-based JetBlue, low-cost long-haul specialist Norwegian is planning to expand its alliance to other carriers, the Scandinavian airline’s co-founder has told an industry event.

Norwegian is planning to expand its alliance to other airlines as part of an ambitious turnaround strategy over the coming years, according to the carrier’s co-founder and president Bjørn Kjos.

Speaking on 19 November 2019 at IATA’s Wings of Change Europe conference in Berlin, Kjos refused to be drawn on the exact details of any future partnerships but said Norwegian has had “a number of very interesting meetings” with other players.  

“I cannot say anything now but there will be a much, much larger alliance,” he said. “You will see a larger entity coming up.”

Norwegian has an existing agreement with easyJet in Europe through the latter’s Worldwide by easyJet service, which allows passengers to connect with partner airline flights and vice versa.

In addition, in October 2019 Norwegian signed a letter of intent with JetBlue to form an interline agreement, enabling for a single booking for connecting flights between the US and Europe.

The partnership, which is expected to launch in early summer 2020, will connect about 60 US and almost 40 Caribbean and Latin American cities to Norwegian’s network in New York, Boston and Fort Lauderdale. From there the Scandinavian carrier serves more than 20 European destinations.

Speaking to Routesonline, Kjos said the agreement with JetBlue will provide feed for its long-haul network. He said that while Norwegian has 516 routes, it still lacks sufficient feed.

“In order to be successful on long-haul, you have to have a good feeder network. A lot of the legacy carriers have done that through their alliances,” he said.

“So what we are doing is building up a feeding structure. We have that in Europe with easyJet, but we don’t currently have anything in the US.

“JetBlue is obviously planning to fly transatlantic so we’ll be able to co-operate with them on those routes, and they can feed us and we can feed them on the US side.”

JetBlue intends to launch multiple daily flights to London from New York JFK and Boston in 2021 using Airbus A321LR aircraft. It is still evaluating which London airport to serve. 

“I don’t see them as a competitor; I see them as a partner,” added Kjos, who stepped down from Norwegian’s chief executive role in July.

In recent months Norwegian has moved away from rapid expansion to prioritising profitability. In the third quarter of 2019, the airline reported a 28 percent rise in net profit to NOK1.67 billion ($184m) compared with NOK1.30 billion in the same period a year ago.

Revenues rose 8 percent to NOK14.4 billion, primarily driven by intercontinental growth, while passenger numbers dropped by 3 percent to 10.5 million in line with a capacity reduction.  

The third quarter profit rise came despite the ongoing grounding of Norwegian's 18 Boeing 737 Max fleet and engine issues with its Boeing 787s. Kjos told Routesonline that Norwegian currently expects the Max to be back in operation “at the start of the second quarter” of 2020.

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