Tag Archives: Norwegian Air Shuttle

Norwegian cancels 97 Boeing jets

Norwegian Air Shuttle has canceled its future orders for 97 Boeing jets including 92 737 MAX jets and five 787 Dreamliners.

Norwegian Air Shuttle aircraft photo gallery:

Norwegian to restart short haul flights from the UK and serve a wider European network from July

Norwegian Air Shuttle has made this announcement:

Norwegian is pleased to announce that in line with other European carriers and as a result of increased customer demand the airline will begin to operate flights between London Gatwick to Oslo, London Gatwick to Copenhagen, Edinburgh to Oslo and Edinburgh to Copenhagen from July 1. 2020.

London to Oslo will be operated seven times a week, London to Copenhagen six times a week, Edinburgh to Oslo and Copenhagen twice a week respectively.

Since April Norwegian has only operated eight aircraft on domestic routes in Norway. Now another 12 aircraft will re-join the fleet and be put into operation across Scandinavia to serve our popular core destinations.

From July Norwegian will operate 76 routes across Europe from the airline’s Scandinavian hubs compared to the 13 domestic Norway only flights served today. Other destinations include Spain, Greece and key European cities.

Further destinations and frequency increases will be announced in due course subject to passenger demand and government travel restrictions.

Norwegian announces a new management structure

Norwegian Air Shuttle has made this announcement:

CEO Jacob Schram has announced a new management structure in Norwegian. The biggest changes involve two distinct commercial units in the Group, greater employee and customer focus, more efficient operation and, not least, an organization that facilitates broad cooperation across the business.

“I have been committed to putting in place a management structure that takes us from growth to profitability by delivering our new Norwegian strategy and business plan. In order to run a profitable and sustainable company going forward, I will build the commercial part around two distinct entities with clear P&L responsibilities,” says CEO Jacob Schram.

By bringing departments together to focus on our customers we gain insight and power to innovate and use smart choices throughout their customer journey. We will remain true to the core values of Norwegian which have been in place since its inception – a popular company that offers good quality flights at a good price.

I have also been committed to improving operations through a simplified structure, clear roles and responsibilities, as well as even more efficient operations,” he continues.

The new group management will be in place from June 2, 2020.

The new departments and management positions:

The newly created AIRLINE department will have the full responsibility for the profit of the core business. The department shall ensure an optimal network of routes, optimize prices, plan flight operations, as well as carry out ongoing sales and marketing activities. The department will be headed by Andrew Hodges, who is currently head of Network Strategy & Planning in the current Norwegian commercial department. Hodges has over 20 years of experience in aviation, including 12 years at low-cost airline easyJet, where he has held several management positions in commercial and finance. He has also worked for British Airways and Deloitte.

AIRLINE ECOSYSTEM is also a new department. The department will have full performance responsibilities and will drive new business ecosystems in connection with the company’s core business. This will take place through partner agreements and new customer platforms. A new manager will be announced in due course, meanwhile Brede Huser will lead the department until a new manager is in place. He is currently head of the Norwegian Reward benefits program.

Responsibility for the entire customer journey will fall under the new CUSTOMER department. The department will deliver the agreed products and services to both the Airline and Airline Ecosystem unit through concept / product development, brand & marketing, customer activation and customer service. The new head of this department is Christoffer Sundby, who will start on the 1st of September. Sundby has a broad experience from operational management, product and concept development, marketing and sales backgrounds. He has formerly worked for Unicare, Circle K, Statoil Fuel & Retail, Statoil and McKinsey. Until September 1st, the department will be headed by Kei Grieg Toyomasu, who is currently Head of Marketing and Digital Channels.

OPERATIONS will work towards the Airline profit unit and provide agreed products and services within flight operations, as well as technical and maintenance, ground services, security and emergency preparedness. A new leader for this area will also be announced in due course. Tore Kristian Jenssen will continue to lead the department until a new leader is in place.

CFO Geir Karlsen continues in his position as head of FINANCE & CONTROL.

IT, SUPPLY CHAIN AND PROCESS IMPROVEMENT is a newly created function that will optimize and streamline all of the company’s processes, systems and procurement. IT and procurement will be centralized to this department, which will also run the company’s business centers and provide lean and optimized processes throughout the company. The department will be headed by Knut Olav Irgens Høeg, who is currently responsible for Procurement, IT and the customer center in Norwegian.

The PEOPLE department will have overall responsibility for all the company’s employees, including pilots and cabin crew. All HR activities, including all training and development of employees will also form part of this department. HSE and trade union dialogue will be priority tasks for this unit. The department will be headed by Guro Poulsen, who currently heads Crew Management in Norwegian.

COMMUNICATIONS will be responsible for external and internal communication, sustainability and public affairs. The department will be headed by Anne-Sissel Skånvik.

In other news, Norwegian has confirmed that the company restructuring has been completed and that the state loan guarantee of in total NOK 3 billion has been approved. The company has now converted NOK 12.7 billion of debt to equity and laid a solid foundation for the future, although the next months will remain challenging.

“I want to thank everyone who has supported the company during this unprecedented crisis that has affected the entire the airline industry: The Government and Parliament; customers; employees: shareholders; leasing companies; creditors; bondholders, the travel industry and other Norwegian supporters. Now that we can access the state loan guarantee, we can continue to transform the company. Through this process, the belief in New Norwegian and the company’s strategy have been confirmed by shareholders, the market, bondholders, leasing companies, other creditors and lenders. Nevertheless, the months ahead will remain challenging and with a high degree of uncertainty for the industry. Norwegian will still need to collaborate closely with a number of creditors as the company currently has limited revenues,” said CEO Jacob Schram.

Since the end of 2018, Norwegian has taken significant actions to restructure its operations and return to profitability. The company was on the path to deliver a positive net profit in 2020, and this summer was set to be the strongest in the company’s history. Instead, the coronavirus outbreak and global travel restrictions has led to a substantial drop in demand.

The Company has seized this time as an opportunity to restructure and develop a new strategy and business plan – New Norwegian – for a strengthened airline to re-emerge when travel restrictions are lifted and demand returns.

 

Norwegian Air calls for a special meeting on May 4 to discuss its future

Norwegian Air Shuttle (Norwegian Air) is basically in hibernation as its plans its future. The beleaguered airline has called for a special meeting on May 4, 2020.

At that meeting, the management of the company is expected to present a new restructuring plan that will see a much smaller airline if approved. Creditors will be asked to exchange debt for equity.

The company is also planning a hibernation phase that will last until next winter.

Read more from Forbes.

Norwegian aircraft photo gallery:

Norwegian’s pilot and cabin crew companies in Sweden and Denmark file for bankruptcy

Norwegian Air Shuttle has made this announcement:

Due to the ongoing spread of the Coronavirus (COVID-19) most countries have advised against or have banned non-essential travel. The closure of borders and quarantine restrictions has effectively brought the entire airline industry to a halt. Consequently, almost all of Norwegian’s flight operations have been cancelled, while the costs for air crew remain. The pilots and cabin crew in Scandinavia are employed in subsidiaries in the Norwegian Group.

Unfortunately, despite the measures that the company has already taken to reduce costs, the Board of these companies are left with no choice but to apply for bankruptcy.

The decisions about filing for bankruptcies in the four crew subsidiaries were made by the respective boards on Monday April 20, 2020.

”The impact the Coronavirus has had on the airline industry is unprecedented. We have done everything we can to avoid making this last-resort decision and we have asked for access to government support in both Sweden and Denmark”, said CEO of Norwegian, Jacob Schram.

“Our pilots and cabin crew are the core of our business and they have done a fantastic job for many years. It is heart-breaking that our Swedish and Danish pilot and cabin crew subsidiaries now are forced to file for bankruptcy, and I’m truly sorry for the consequences this will have for our colleagues. We are working around the clock to get through this crisis and to return as a stronger Norwegian with the goal of bringing as many colleagues back in the air as possible,” Schram said.

In Norway, there are efficient furlough opportunities which means that the government pays for all salary related costs throughout the duration of the furlough period. Unfortunately, there is not the equivalent coverage in Sweden or Denmark schemes.

Despite the measures that the company has already taken, coupled with the lack of significant financial support from the Swedish and Danish governments, we are left with no choice.

The Board of the below companies in the Norwegian Group on April 20, 2020 decided to file for bankruptcy:

Norwegian Pilot Services Sweden AB

Norwegian Pilot Services Denmark ApS

Norwegian Cabin Services Denmark ApS

Norwegian Air Resources Denmark LH ApS

Due to the extraordinary situation (force majeure), Norwegian has also notified OSM Aviation that it has cancelled the crew provision agreements with several of its jointly owned OSM Aviation subsidiaries. These companies have crew based in Spain, UK, Finland, Sweden and the US.

The above actions will affect 1,571 pilots and 3,134 cabin crew. About 700 pilots and 1,300 cabin crew based in Norway, France and Italy are not affected.

The process of the subsidiaries filing for bankruptcy is now being managed by bankruptcy courts and bankruptcy trustees in the respective countries.

Video:

Norwegian March traffic figures heavily influenced by COVID-19 measures

Norwegian Air Shuttle made this announcement:

The global outbreak of COVID-19 that took hold across the aviation industry throughout March has heavily influenced Norwegian’s traffic figures. The company experienced a dramatic drop in demand following government-imposed travel restrictions and a general travel decline.

Norwegian immediately responded to this global change in demand and adapted its flight schedule several times during the month. The first step was to cut approximately 15 percent of planned capacity on March 10, this was then reevaluated and adjusted to up to 85 percent of planned capacity from March 16 with most cancellations starting from March 25. Capacity was 40 percent lower than planned while the flights that were operated had a load factor of 72 percent, down 13.8 percentage points compared to the same month previous year.

Compared to the same period last year total capacity (ASK) decreased by 53 percent while total passenger traffic (RPK) decreased by 60 percent. The total number of customers carried in March was 1,153,283, a decrease of 61 percent.

In March, Norwegian operated 77 percent of scheduled flights, multiple rescue flights and continued to maintain a critical regional flying infrastructure.

Jacob Schram, CEO of Norwegian, said: “The speed of the COVID-19 global outbreak throughout March had a profound impact on the entire Norwegian network as cancellations, in line with global travel advice and falling demand, were implemented throughout the month. Norwegian operated multiple rescue flights on behalf of the government to ensure that thousands of Scandinavian passengers could safely return home. I would like to take this opportunity to thank all our dedicated colleagues, our customers and members of the public for their continued support. We will provide further financial and business updates to the Oslo Børs when it is appropriate to do so.”

Norwegian to suspend more than 4,000 flights and implement layoffs

Norwegian Air Shuttle has made this announcement:

Following the U.S. ban on travel from most of Europe and the escalating coronavirus situation, Norwegian has decided to ground 40 percent of its long-haul fleet and cancel up to 25 percent of its short-haul flights until the end of May. The changes apply to the company’s entire route network.

Jacob Schram, CEO of Norwegian said: “This is an unprecedented situation and our main priority continues to be the care and safety of our customers and colleagues. 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.”

40 percent of long-haul capacity to be cancelled

From March 13th to March 29th, we will cancel the majority of our long-haul flights to the U.S. from Amsterdam, Madrid, Oslo, Stockholm, Barcelona and Paris.

From March 13th to the end of May, all flights between Rome and the U.S. will be cancelled.

From March 29th until the end of April, all flights from Paris, Barcelona, Madrid, Amsterdam, Athens and Oslo to the U.S. will be cancelled.

All routes between London Gatwick and the U.S. will continue to operate as normal. Our goal is to reroute as many of our customers as possible through London during this difficult period.

The short-haul network heavily impacted

Norwegian will also cancel a large share of its domestic flights in Norway and flights within Scandinavia, such as Oslo-Copenhagen and Oslo-Stockholm. Flights to Italy will also be cancelled. Domestic and intra-Scandinavian flights will be combined to re-protect our customers.

Customers booked to travel on affected flights will be contacted to discuss their options including rebooking onto a flight at a later date. Due to a high number of enquires we encourage all customers to check our website www.norwegian.com/updates for the latest travel advice. If your travels are past April 15th, 2020, please refrain from contacting our Customer Care team at this time.

Layoffs

During a pandemic it is Norwegian’s policy to prioritize and safeguard the health and well-being of employees while ensuring Norwegian’s ability to maintain essential operations and continue providing services to our customers.

Due to the extraordinary market situation as a result of the coronavirus, and thus a dramatic drop in customers and subsequent production decline, we must look at all possible measures to reduce costs. This unfortunately also includes temporary layoffs of up to 50 percent of our employees and the number may increase. All departments will be affected by the temporary layoffs.

We have initiated, in consultation with the unions, a discussion and mapping process and will then return with leave notices to affected departments, stations and employees.

Norwegian Air Shuttle aircraft photo gallery:

Norwegian drops 22 long-haul flights to the United States

Norwegian has made this announcement:

Norwegian has during the past few days experienced reduced demand on some routes, particularly on future bookings. Bookings for flights departing in the coming weeks are less affected. The company has decided to cancel 22 long-haul flights between Europe and the U.S. from March 28 to May 5. Norwegian has a limited number of flights to Northern Italy and other regions heavily affected by the virus. In addition, the company has a higher share of leisure traffic, which seem less affected than business traffic. The company has also already reduced its capacity by up to 15 percent in 2020. Norwegian is monitoring the developments closely and is continuously evaluating additional changes to its schedule.

The following routes are affected: Rome – Los Angeles; Rome – Boston; Rome – New York (reduced number of departures during selected weeks on all these routes) and London – New York (three daily departures are reduced to two on some days).

Affected customers will be contacted by Norwegian and offered a new itinerary.

Given the uncertainty and ongoing impact on overall demand for air travel, Norwegian withdraws its 2020 guidance provided to the market on February 13, 2020. At this stage, it is too early to assess the full impact on our business.

Norwegian aircraft photo gallery:

Norwegian blames its 2019 losses on the grounding of the Boeing 737 MAX and Rolls-Royce engine issues

Norwegian Air Shuttle issued this financial report for the fourth quarter and full-year 2019:

Norwegian reported its full year and fourth quarter 2019 results. Year on year, unit revenue increased in nine consecutive months, driven by maturing routes and the optimization of Norwegian’s global route network. The punctuality has improved considerably during the past six quarters, and in the fourth quarter 2019 it was up 3.1 percentage points to 82.6 percent.

Figures were negatively impacted by the global grounding of the Boeing 737 MAX aircraft and ongoing Rolls Royce engine issues. The net loss was NOK 1,609 million ($173.8 million) in 2019, while the underlying operating result before ownership costs doubled to NOK 6.5 billion.

In 2019, Norwegian secured significant financial milestones that further strengthened the airline’s move to profitability. The internal cost-reduction program #Focus2019 delivered on target with cost reductions of NOK 2.3 billion for the full year and NOK 444 million in the fourth quarter. In addition, the company has postponed aircraft deliveries, sold aircraft, sold its shares in Norwegian Finance Holding and sold its domestic operation in Argentina as well as raised new capital to strengthen the liquidity.

At the same time, 2019 was a challenging year for the industry marked by a tough trading environment. Significant costs caused by the global grounding of the Boeing 737 MAX and the ongoing Rolls Royce engine issues on the Dreamliner fleet meant the company was forced to wetlease additional aircraft to avoid cancellations and delays throughout the network.

The company’s total revenue in 2019 was NOK 43.5 billion, an increase of eight percent compared to 2018, driven by improved unit revenue and increased ancillary revenue per passenger. Norwegian’s shift in strategic focus from growth to profitability resulted in a production growth (ASK) of one percent while unit revenue increased seven percent. The load factor was 86.6 percent and more than 36 million customers chose to travel with Norwegian.

Fourth quarter results

For the fourth quarter, underlying operating result before ownership costs (EBITDAR excluding other losses/gains) improved to NOK 436 million compared to a loss of NOK 118 million in Q4 2018. Total revenue was NOK 8.9 billion, representing a seven percent reduction in revenue driven by capacity reductions and route optimization across the network. However, the revenue reduction was more than offset by lower operating expenses. In Q4, production (ASK) decreased by 19 percent, while a 16 percent improvement in unit revenue and eight percent higher ancillary revenue per passenger countered much of the capacity reduction. More than 7.5 million customers chose to travel with Norwegian this quarter.

“2019 marked a new flight path for Norwegian as the company changed its strategy to move from growth to profitability. We have achieved our initial goal to save NOK 2.3 billion as part of #Focus2019 and concluded several positive financial milestones. The focus of returning to profitability will continue as we focus on Program NEXT to build a strong, sustainable and profitable business to benefit our customers, employees and shareholders,” said Chief Financial Officer of Norwegian Geir Karlsen.

“Throughout 2020, we will turn challenges into opportunities as we remain committed to offering greater choice to customers, contributing to a sustainable aviation industry and refining our products and services. Norwegian has changed the landscape of low-cost travel and as a company we will continue to change and adapt to further attract both business and leisure customers,” said CEO of Norwegian Jacob Schram.

1.7 million tons of CO2 saved

Thanks to Norwegian’s young and more fuel-efficient fleet, 1.7 million metric tons of CO2 were saved in 2019 compared to the industry average. At the same time, 40 percent of the total CO2 emissions were offset through EU’s emissions trading system. Since its launch in December, 123,000 customers compensated their carbon footprint using the partnership between Norwegian and the climate-tech company CHOOOSE during the booking process.

Norwegian in the UK and Ireland:

  • Norwegian carries almost 6 million UK passengers each year from London Gatwick, Edinburgh and Manchester Airports to 30 destinations worldwide
  • Norwegian is the third largest airline at London Gatwick, with 4.6 million yearly passengers, and over 1,200 UK-based pilots and cabin crew
  • In 2014, Norwegian introduced the UK’s first low-cost, long haul flights to the U.S. – the airline now flies to 11 U.S destinations, Buenos Aires and Rio de Janeiro from London Gatwick
  • Norwegian is the only airline to offer free inflight WiFi on UK flights to more than 30 European destinations and 13 long-haul destinations.
  • The airline has one of the youngest aircraft fleets in the world with an average age of 3.8 years, including next-generation Boeing 787 Dreamliner, Boeing 737 MAX and Boeing 737-800s
  • Norwegian has been voted ‘Europe’s best low-cost carrier’ by passengers for six consecutive years at SkyTrax World Airline Awards from 2013-2018, along with being awarded the ‘World’s best low-cost long-haul airline’ in 2015, 2016, 2017, 2018 and 2019
  • Norwegian Reward is the airline’s free to join award-winning loyalty program offering members CashPoints and Rewards that reduce the cost of Norwegian flights

Norwegian aircraft photo gallery:

Jacob Schram appointed new CEO of Norwegian, drops long-haul routes from Stockholm and Copenhagen

Norwegian’s Board of Directors has appointed Jacob Schram as CEO of Norwegian, starting January 1, 2020. Geir Karlsen will continue as CFO and Deputy CEO.

Jacob Schram (57) has 30 years of experience from large international companies. He has previously held managing roles in Circle K, Statoil Fuel & Retail (SFR), McDonalds and McKinsey. As CEO, he led the process of publicly listing SFR on the Norwegian Stock Exchange in 2010. When Couche-Tard acquired SFR in 2012, he held the position as Group President for Europe until he stepped down in 2018. Schram initiated and led the global rebranding to Circle K at more than 10 000 stores across Couche-Tard’s international network and service stations.

Schram is also the author of the book “The Essence of business”. During the last year he has worked with private investments, start-ups and presentations related to his book and the topic “Future mobility 2030”, in addition to holding the position as Senior Advisor at McKinsey. Schram has a Master’s degree in Economics from Copenhagen Business School. He is a Norwegian citizen.

“Norwegian has made aviation history and I am honored to take on the role as CEO. The airline industry is characterized by strong competition and unforeseen events, but it is also an industry that is important to people everywhere. I look forward to using my experience to build on the strong foundation laid down by Bjørn Kjos, Geir Karlsen and the rest of the talented and dedicated Norwegian team. Now, my main focus will be to bring the company back to profitability and fortify the company’s position as a strong international player within the aviation industry,” said newly appointed CEO of Norwegian, Jacob Schram.

In other news, Norwegian’s long-haul flights from Stockholm (Arlanda) and Copenhagen will be discontinued on March 29, 2020.

Norwegian aircraft photo gallery: