Norwegian Air Shuttle continues to struggle for survival, as the Norwegian Government refusing to give it further funding. As such, the airline has been forced to take drastic action.
With the government refusing to give extra funding, the airline has had to place its employees on furlough and reduce capacity. Like most airlines, they are suffering due to the downturn in travel due to government-imposed travel restrictions.
Norwegian is in the position where it needed the funding and requires it o keep its running costs to a minimum.
The airline is to furlough an additional 1,600 staff and park 15 of the 21 aircraft. Before COVID-19, the airline employed over 10,000. It will now keep just 600 people employed.
The airline plans to operate the following routes with six active aircraft:
- Oslo – Alta
- Oslo – Bergen
- Oslo – Bodø
- Oslo – Evenes
- Oslo – Haugesund
- Oslo – Kirkenes
- Oslo – Molde
- Oslo – Stavanger
- Oslo – Tromsø
- Oslo – Trondheim
- Oslo – Ålesund
- Tromsø – Longyearbyen
The airline released the following statement on the government not willing to invest in it. Norwegian’s CEO Jacob Schram stated the following
“First of all, I would like to thank of our customers, colleagues, the Norwegian Parliament, shareholders, leasing companies, creditors, bondholders, the travel industry and all others who have been supporting Norwegian in these challenging times. The fact that our government has decided to refrain from providing Norwegian with further financial support is very disappointing and feels like a slap in the face for everybody at Norwegian who is fighting for the company when our competitors are receiving billions in funding from their respective governments,”
“We are called Norwegian, We are Norwegian. We are a part of Norway and Norway is a part of us. This is the way it has been for almost 20 years. The support that we have received from our customers throughout all these years has meant a lot to us, in particular now during the Covid-19 crisis. We offer routes from Kristiansand in the south to Svalbard in the north, routes that cannot be replaced overnight. It will take time and it will have consequences for the competitive situation in Norway, like we have seen before. We also notice that airlines across the world that are also dependent on support to survive, are receiving billions from their respective authorities. Based on the number of tourists we fly to Norway, we contribute to sustaining 24,000 people in our country and boost the local economy by approximately 18 billion NOK per year. That alone clearly demonstrates that even moderate financial support, would constitute a profitable investment for Norway. How anyone could come to a different conclusion is impossible to understand. The local travel industry and businesses have again and again emphasized the importance of Norwegian’s route network. I recently visited all of our four bases in Norway and also met with local politicians and businesses,”
“We could clearly see the results of our hard work to go from growth to profitability, which was initiated in 2018. With further support to get Norwegian through this unprecedented crisis for the aviation industry, we would come out as a more sustainable and competitive airline, with a new structure and improved operation. Without support, the way forward has become much more uncertain. However, we will do whatever we can get through this crisis, to the benefit of our hard-working colleagues, our «Red Nose Warriors», and our customers,”
Can the airline survive?
If Norwegian’s foundations were shaky in the past, its future is turning into a fight to survival – with it cutting back to the bone. As Europe and Scandinavia tighten their travel restrictions over the winter due to spikes in COVID-19, it’s not a time for people to travel who would normally choose sustainable travel.
With the airline cutting back near enough to the bone, it has to hope that the promise of a vaccine, as well as an operating a minimal, but sustainable network, will be enough to see the airline through the dark winter months.
And there-in – is the real challenge.
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