Norwegian Air Shuttle will exit the low-cost long-haul market to focus on services within Norway and to “key European destinations.”
The carrier said ongoing COVID-19 travel restrictions mean that “future demand remains highly uncertain” for its flights to the US and Asia, making its long-haul operations no longer viable.
The carrier has 2,160 pilots and crew working at subsidiaries in the UK, U.S., Italy, Spain and France whose jobs will go; 1,100 of those staff are at Norwegian’s London Gatwick (LGW) base.
Norwegian said the move was part of a strategy to “build a robust and solid company that will attract investors and continue to serve new and existing customers.” The airline filed for protection from creditors in Ireland in November.
“Our short-haul network has always been the backbone of Norwegian and will form the basis of a future resilient business model,” Norwegian CEO Jacob Schram said.
“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 has been hit hard by the COVID-19 crisis but was already struggling before the pandemic after its rapid long-haul expansion left it with a huge debt burden. The worldwide grounding of the Boeing 737 MAX jet also affected operations and a restructuring process was underway when coronavirus brought the airline to a standstill.
The LCC now plans to serve the Nordics and European destinations with around 50 narrowbody aircraft this year, increasing to about 70 in 2022. The business also hopes to raise as much as NOK5 billion ($590 million) in new capital to finance its operations.
Following the arrival of the carrier’s first 787-8 aircraft later that year, further routes were added. Transatlantic service began from Copenhagen (CPH), while Fort Lauderdale (FLL) became its second destination in the US.
In the subsequent years, Norwegian became a disruptive force in the European aviation industry under the leadership of co-founder Bjørn Kjos, adding large amounts of capacity and rapidly increasing the number of routes, particularly to US destinations like Boston (BOS), Los Angeles (LAX), Newark (EWR) and Oakland (OAK).
The airline carved out a niche in finding big point-to-point markets with room to grow and stimulate new traffic, as well as targeting unserved routes to secondary cites.
According to figures from OAG Schedules Analyser, capacity grew from 25 million seats in 2012 to reach 40.2 million in 2017 and 46 million in 2018. Year-on-year growth between 2017 and 2018 was 14.4%, putting it among the fastest-growing carriers in the world.
During 2018, Norwegian operated 52 routes between Europe and North America, as well as seven long-haul routes to destinations in Asia.
Following the grounding of Norwegian’s 18 737 MAXs, more transatlantic routes were scrapped, including all operations from Dublin (DUB), Cork (ORK) and Shannon (SNN). Total capacity in 2019 was 43.3 million seats, down by almost 6% on the previous 12 months.
Looking at Norwegian’s long-haul network during 2019, OAG figures show that LGW was the carrier’s largest base. The airline offered almost 1.1 million departure seats to long-haul destinations from the airport, ahead of Paris Charles de Gaulle (CDG) with 482,860 seats and Barcelona (BCN) with 303,358 seats.
LGW-JFK was Norwegian’s biggest long-haul route in 2019, with the carrier offering 312,590 two-way seats between the destinations. The figure gave the airline a 10.7% capacity share of all seats provided between London and New York during the year. British Airways was the largest with 34.5%.
Photro credit: Nigel Howarth / Aviation Week