Norwegian Air Shuttle

Norwegian Air Shuttle ASA
IATA ICAO Callsign
DY NAX NOR SHUTTLE
Founded 22 January 1993
Operating bases
Frequent-flyer program Norwegian Reward
Subsidiaries Norwegian Long Haul
Norwegian Air International
Norwegian Air UK
Norwegian Air Argentina
Fleet size 55 (159 across all Norwegian airlines)
Destinations 153
Headquarters "Diamanten"
Fornebu, Norway
Key people Bjørn Kjos (CEO)
Bjørn H. Kise (Chairman)
Tore Jenssen (CEO Norwegian Air International)
Revenue Increase NOK 25.95 billion (2016)[1]
Operating income Increase NOK 1.82 billion (2016)[1]
Net income Increase NOK 1.134 billion (2016)[1]
Website norwegian.com

Norwegian Air Shuttle ASA (OSE: NAS), trading as Norwegian, is a Norwegian low-cost airline. It is the third largest low-cost carrier in Europe behind easyJet and Ryanair and the ninth-largest low-cost airline in the world, the largest airline in Scandinavia[2], and the eighth-largest airline in Europe in terms of passenger numbers.[3] It offers a high-frequency domestic flight schedule within Scandinavia and Finland, and to business destinations such as London, as well as to holiday destinations in the Mediterranean and the Canary Islands, transporting over 30 million people in 2016. The airline is known for its distinctive livery of white with a red nose, with portraits of distinguished Scandinavians on the tail fins of its aircraft.

Norwegian launched its long-haul operation in May 2013. The long-haul flights are operated by fully owned subsidiaries: Norway-based Norwegian Long Haul, Ireland-based Norwegian Air International, United Kingdom-based Norwegian Air UK, and Argentina-based Norwegian Air Argentina. Each airline holds a unique air operator's certificate (AOC) but shares branding and commercial functions with the rest of the Group.

History

Regional airline – 1993–2002

Norwegian Air Shuttle (NAS) was founded on 22 January 1993 to take over the regional airline services produced by Busy Bee for Braathens in Western Norway. Busy Bee, founded in 1966, was a subsidiary of Braathens that operated a fleet of Fokker 50 aircraft on charter services. This included the network of regional services between cities on the west coast of Norway operated on wet lease for the mother company. Following Busy Bee's bankruptcy in December 1992, NAS took over three leased Fokker 50 aircraft, and started operating from Bergen Airport, Flesland to Haugesund Airport, Karmøy, as well as from Bergen to Molde Airport, Årø or Kristiansund Airport, Kvernberget, and onwards to Trondheim Airport, Værnes. The company was established and owned by former Busy Bee employees and initially had a workforce of fifty.[4][5] It was based in Bergen, but later established a technical base in Stavanger.[6]

From 1 April 1994, the airline also began service from Bergen to Ålesund Airport, Vigra.[7] In 1995, the company received its fourth Fokker 50s, and had a revenue of NOK 86.6 million and a profit of NOK 2.9 million. It flew 50 daily services.[8]

By 1999, the company had six Fokker 50s and flew 500,000 passengers on 20,000 flights.[6][9] The company had a revenue of NOK 172 million and a profit of NOK 13 million. On 2 June 2000, NAS bought the helicopter operator Lufttransport from Helikopter Service.[9] In 2000, the NAS fleet was expanded to seven Fokker 50s. From 2 January 2001, several Braathens routes were terminated, including the NAS-operated services from Kristiansund to Trondheim and Molde. The route from Bergen to Haugesund, and Bergen–Molde–Trondheim were reduced.[10]

On 7 January 2002, NAS took over the responsibility for the route from Stavanger to Newcastle, flying two round trips per day. This was the first route on which the airline did not wet lease the aircraft to Braathens, but instead operated the route in its own right. After Braathens was bought by Scandinavian Airlines System (SAS) in November 2001, all contracts that Norwegian had with Braathens for the routes on the Norwegian west coast were cancelled by SAS, as it wanted its subsidiary SAS Commuter to take the routes over. NAS had an 18-month cancellation period in its contract with Braathens, however this was not respected by SAS; the contracts were terminated without any notice.[11]

Low-cost carrier – 2002 onwards

Norwegian previously operated seven McDonnell Douglas MD-80s previously owned from FlyNordic

Following the decision by SAS to purchase Braathens, and the subsequent termination of all contracts between Braathens and NAS, NAS announced in April 2002 that it would start domestic scheduled services as a low-cost carrier on the busiest routes. From 1 September 2002, the airline re-branded as Norwegian.[12]

The airline opened its second hub at Warsaw Frederic Chopin Airport in Poland, flying to Central European destinations. There were two Boeing 737 operating from Warsaw.[13] The base was closed in 2010. Norwegian Air Shuttle ASA announced 24 April 2007 that it had bought 100% of the Swedish low-cost airline FlyNordic from Finnair plc; becoming the largest low-cost airline in Scandinavia. As payment for the shares in FlyNordic, Finnair received a 5% share stake in Norwegian.[14]

On 30 August 2007, Norwegian ordered 42 new Boeing 737-800 aircraft, with options for 42 more, an order worth US$3.1 billion.[15] This order was later increased by six aircraft in November 2009. In July 2010 15 of the options were converted to orders, and in June 2011 15 more options were converted, bringing the total order of new, owned 737-800s to 78 aircraft with 12 remaining options. Additionally, Norwegian introduced leased Boeing 737-800 aircraft into the fleet. The first leased 737-800 arrived at Oslo Airport, Gardermoen, Norway, on 26 January 2008.[16]

In April 2010, Norwegian started flights from Oslo-Gardermoen and Stockholm to Helsinki-Vantaa Airport. During early 2011, Norwegian had three aircraft stationed there, introducing domestic flights to Oulu Airport and Rovaniemi Airport on 31 March 2011. In May, flights to nine additional international destinations began.[17][18]

In October 2009, Norwegian announced it intended to start flights from Oslo to New York City and Bangkok, requiring new intercontinental aircraft. In 2010, it said it was considering up to 15 intercontinental destinations from Scandinavia, and would also consider services to South America and Africa.[19] On 8 November 2010, Norwegian announced that it had contracted to lease two new Boeing 787 Dreamliners with delivery in 2012; and that it was negotiating the leasing of additional aircraft.[20]

On 25 January 2012, Norwegian announced the largest orders of aircraft in European history. The orders consist of 22 Boeing 737-800 and 100 Boeing 737 MAX 8 aircraft with options for another 100 of the latter; and for 100 Airbus A320neos with options for another 50.[21]

In late October 2012, the airline announced a new base at London Gatwick from spring 2013 with three Boeing 737-800s to be used on new international routes from London to leisure destinations in Spain, Portugal, France, Italy and Croatia. All announced routes are flown in competition with airlines such as easyJet, Ryanair and Thomson Airways. Gatwick is also served by Norwegian from a large number of cities in Scandinavia.[22]

In 2016 Norwegian won its first charter contract in the United States, flying three Boeing 737-800s out of Chicago/Rockford International Airport and General Mitchell International Airport in Milwaukee to Mexico and the Caribbean from December 2016 to April 2017 for Apple Vacations and Funjet Vacations.[23]

On 20 April 2017, Norwegian announced that it will launch flights between London-Gatwick and Singapore with the Boeing 787. The flight will be operated by Norwegian Air UK.[24]

To finance its aggressive growth involving the inauguration of many new routes across itself and its subsidiaries, the hiring and training of new employees, and the accepting of aircraft deliveries, Norwegian sold some of its shares in Bank Norwegian in June and December 2017, and participated in the sale and leaseback of its owned aircraft.[25]

With 220 aircraft on order as of 30 April 2018, Norwegian has the second largest orderbook among European airlines, after Wizz Air with 273.[26] On 2nd May 2018, Norwegian launched a third daily New York to London flight.[27]

Corporate affairs

Overview

Diamanten, the headquarters of Norwegian Air Shuttle

The company is headed by CEO and largest shareholder Bjørn Kjos, and the board is chaired by Bjørn H. Kise.[28][29] The airline is listed on the Oslo Stock Exchange.

The company's head office is in Diamanten, an office building at Fornebu, Bærum outside Oslo.[30] Previously, the airline had its head office functions inside other buildings in Fornebu,[31] but in 2010 moved to Diamanten, which had been the former Braathens, and later SAS Norway, head office.[30]

The Norwegian Group consists of the parent company Norwegian Air Shuttle ASA, and the fully owned subsidiaries Norwegian Air Shuttle Polska Sp.zo.o and Norwegian Air Shuttle Sweden AB. All flights are operated by the parent company Norwegian Air Shuttle ASA; the subsidiaries manage personnel, sales and marketing within certain geographical areas.

Norwegian Air Shuttle ASA owns 100% of the telephone company Call Norwegian AS, 99.9% of NAS Asset Management which owns the new 737-800 aircraft purchased from Boeing, 100% of NAS Asset Management Norway AS, and 100% of Norwegian Long Haul AS, as well as 20% of Norwegian Finans Holding ASA (Bank Norwegian AS).

Norwegian is a member of Airlines for Europe.[32]

The key trends for Norwegian over recent years are shown below (as at year ending 31 December):

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Turnover (MNOK) 1,972 2,941 4,226 6,226 7,309 8,598 10,532 12,859 15,580 19,540 22,491 26,055 30,948
Profit (EBT) (MNOK) 39 −32 113 5 623 243 167 623 437 −1,627 75 1,508 −2,562
Number of employees (FTE at y/end) 560 882 1,417 1,596 1,852 2,211 2,555 2,890 3,738 4,314 4,576 5,796 -
Number of passengers (m) 3.3 5.1 6.9 9.1 10.8 13.0 15.7 17.7 20.7 24.0 25.8 29.3 33.2
Passenger load factor (%) 78.0 78.6 80.1 78.7 78.2 77.4 79.3 78.5 78.3 80.9 86.2 87.7 87.5
Revenue/RPK (Yield) (NOK) 0.68 0.67 0.67 - - - - 0.55 0.50 0.43 - 0.42 0.39
Revenue/ASK (RASK) 0.56 0.54 0.52 0.49 0.47 0.40 0.42 0.43 0.38 0.35 0.38 0.36 0.34
Unit Cost (CASK) [33] - - 0.53 0.56 0.49 0.46 0.46 0.45 0.42 0.42 0.42 0.41 0.43
Number of aircraft (at year end) 13 22 32 40 46 57 62 68 85 95 99 118 144
Notes/sources [34] [34] [34] [34] [34] [35] [34] [36] [37] [38] [39] [33] [40]

Criticism

Customer services

Norwegian Air customers have lodged a record number of complaints, with a tribunal judge stating to Dagens Næringsliv, "We have never before seen this scope of complaints in a single case".[41] With more than 200 complaints having been registered with the Transport Complaints Board alone, passengers have created the Twitter hashtag, #NeverFlyNorwegian.[42]

Norwegian's policies have also been criticized by passengers who were left without food, drinks and blankets on board for up to 12 hours (available for pay but only with credit card).[43] In August 2014, 35,000 people were reportedly hit with delays when flying with Norwegian, and 1,200 passengers ultimately sued Norwegian for compensation.[44]

However, for the most part, the tribunal did not agree with the complaints and only in a few cases has Norwegian had to compensate the passenger(s).[45][46][47]

Labour relations

Between 2011 and 2013, Norwegian Air Shuttle (NAS) has received harsh criticism regarding its treatment of employees. The media first reported NAS's announced intention to open a base in Helsinki, from where it hired pilots on short-term contracts (in Estonia) rather than as employees within the company. The Norwegian tax-office authorities suspected in August 2012 that many Norwegian citizens were working for NAS on these contracts and not paying Norwegian taxes despite operating on flights originating from Norway.[48][49]

The Norwegian Pilot's Union (NPU) brought NAS to court over the short-term contracts. NAS CEO Bjørn Kjos only inflamed matters when he declared that NAS would no longer hire employees on Norwegian terms.[50][51]

In the fall of 2012, NAS started to use contract-employed pilots on routes within Scandinavia, which was considered by the NPU to be an abrogation of labor terms regarding non-Scandinavian pilots on routes within Scandinavia. NPU soon after sued NAS.[52]

In October 2013, the NPU announced their intention to strike as NAS forced its pilots to face dismissal or transfer to Norwegian Air Norway or Norwegian Air Resources AB, both subsidiaries of NAS. The respective subsidiary would then lease the pilots back to NAS. NPU and their Swedish counterpart SPF accused NAS of using this ploy to break the solidarity and organization of the pilots, with the eventual goal of co-ercing pilots to converting their jobs to contract positions.[53][54]

In mid-December, NAS faced its Swedish non-contract flight-attendants with either dismissal or transference to Proffice Aviation, an external staffing company. According to the Swedish cabin-crew union, Unionen, it managed to save the jobs of 53 NAS employees, but it was dissatisfied with the direction NAS had taken. The situation led to the leader for the Swedish Left Party, Jonas Sjöstedt, to state that stricter regulation is needed for the use of staffing-companies in Sweden.[55]

Norwegian Long Haul

Norwegian has also been criticised for the terms of its contracts with its long-haul flight-attendants on contracts based in Thailand.[56] This has caused the Air Line Pilots Association to further accuse Norwegian of unfair competition practices.

The airline contests these accusations and has disclosed the pay scale for its Thai employees, who earn between USD 33,300 and USD 39,200 per annum which is under the $42.2K USD [57] average pay for US flight attendants (though these comparisons are made between solely intercontinental Norwegian Long Haul flights versus domestic and intercontinental flights of US paid flight attendants).[58]

Destinations

  Norwegian Short Haul
  Norwegian Long Haul
  Seasonal
  Future
  Terminated

Norwegian serves Europe, North Africa and the Middle East for both business and leisure markets. In total the airline operates 500 routes to 150 destinations in 35 countries on four continents.

Domestic, intra-Nordic and typical European business and leisure destinations have the most service. The busiest routes in Norwegian’s network are the Oslo to Bergen and the Oslo to Trondheim routes with 15 daily round-trips. Norwegian’s largest non-Scandinavian operation is to London Gatwick with up to 24 daily round-trips. Intra-Scandinavian routes, and in particular "the capital triangle" between Oslo, Stockholm and Copenhagen, is attractive due to extensive traffic for both business and leisure travellers. Other modes of transportation are generally slow between these cities.[59]

Typical leisure destinations in Southern Europe are typically served once or twice a day from the main Nordic cities.

Long-haul operations

Norwegian started long-haul flights on 30 May 2013.[60] The first scheduled Norwegian Long Haul flights were from Oslo and Stockholm to New York City and Bangkok, originally with wet-leased Airbus A340-300 aircraft while the airline awaited delivery of its new Boeing 787 Dreamliner aircraft. In March 2013 Norwegian Air Shuttle confirmed new long haul routes from Copenhagen, Oslo and Stockholm to Fort Lauderdale in Florida, beginning on 29 November 2013.[61]

Fleet

Norwegian Boeing 737-800

As of October 2018, the Norwegian Air Shuttle fleet, not including subsidiaries, consists of the following aircraft:[62][63][64]

Norwegian Air Shuttle fleet
Aircraft In Service Orders Passengers Notes
Airbus A321LR — 30 220[65] Deliveries begin 2019.[66]
Boeing 737-800 52 — 186
189
Boeing 737 MAX 8 3 98 189[67] Order to be distributed among parent and subsidiary airlines.
Deliveries (to subsidiaries) began June 2017.
Total 55 128

As of October 2018, Norwegian and its subsidiaries operate 159 aircraft, which includes 71 aircraft by Norwegian Air International, 19 by Norwegian Long Haul, 13 by Norwegian Air UK, and 1 by Norwegian Air Argentina.[68][69][70][71]

Historical fleet

A former Norwegian Fokker 50
A former Norwegian Boeing 737-300

From 1993 to 2002, the company solely operated Fokker F-50 turbo-prop aircraft primarily as a commuter airline, having a total fleet of six in 2002. The company ceased all F-50 operations at the end of 2003 in order to focus on the Boeing 737-300 jet operations and sold the last three of the Fokker F-50 in early 2004. For a limited period in the early years of the 737 operation Norwegian operated a 737-500 as an interim solution while waiting for 737-300 deliveries. Following the acquisition of Swedish low cost airline FlyNordic in 2007, Norwegian inherited eight MD-80 aircraft. The last of the MD-80 aircraft was phased out two years later.

Norwegian Air Shuttle historical fleet
Aircraft Introduced Retired Ref
Boeing 737-300 2002 2015 [72][73]
Boeing 737-500 2002 2003 [72][73]
Fokker 50 1992 2004 [72][74]
McDonnell Douglas MD-82 2008 2009 [72][75]
McDonnell Douglas MD-83 2008 2009 [72][75]

Livery

Norwegian's aircraft livery is white with a signal red nose. Slightly further down the aircraft is a dark blue line. The vertical stabilizer of the aircraft in Norwegian's fleet is either white with red and dark blue lines at the top with white Norwegians titles in the blue or features depictions of historically significant Norwegians, Finns, Danes, and Swedes.[76] Norwegian has also operated a single aircraft in a special promotional livery for the insurance company Silver.[77]

Operations and services

Norwegian Air Shuttle Boeing 737-800 interior

All flight operations are performed under one single air operator's certificate (AOC) (ICAO airline designator NAX). The Group also held a Swedish AOC (ICAO airline designator NDC) up until 2009, but the double AOC operation was discontinued for efficiency purposes. The main technical base is at Stavanger, although heavy maintenance (C/D checks) and engine maintenance are put out on tender.

Norwegian, as a low-cost airline, operates aircraft with all-economy class seating (except on the Boeing 787 which offers 2 cabins, Premium and Economy). Surcharges are taken for on-board food and drinks, check-in baggage, payment by credit card and other non-core services.[78]

The airline runs a frequent flyer program called Norwegian Reward. Passengers can earn points based on the price of the ticket and the ticket class (20% on Flex tickets, 2% on LowFare tickets). Norwegian supported the ban on point accrual that was in force on Norwegian domestic flights until 16 May 2013, but when that ban was lifted, the reward programs were extended to that market as well.[79]

Norwegian also offers free WiFi on services in Europe and on flights between the U.S. and the Caribbean. WiFi is not available on international long-haul flights.[80]

Accidents and incidents

On 11 July 2017, Norwegian Air Shuttle Flight 4287, a Boeing 737-8JP (LN-NHF), ran off the end of the runway at Helsinki Airport in Vantaa, Finland, coming to a stop in a grass field. None of the 166 passengers onboard were injured. There was heavy rainfall at the time of the incident which is being investigated by Finland's Safety Investigation Authority.[81][82][83]

Humanitarian work

Since 2007, Norwegian has been a signature partner with UNICEF Norway and has 4 aid flights to various war torn countries in the world. These are flights where the company, its employees and passengers contribute with money to fill up an aircraft with aid and deliver it to the country in need. Passengers can contribute when they purchase tickets, food and drinks, or through the entertainment system on board. Previously, the airline has used one of its Boeing 737-300 or Boeing 737-800 aircraft in a special UNICEF livery, however in 2017 for its mission to Yemen, the airline used for the first time a Boeing 787-9 for such a mission.[84] Recently the airline has also cooperated with MegaDo and Insideflyer, auctioning off seats for these special flights with all proceeds donated to UNICEF.[85]

Norwegian and UNICEF have conducted four humanitarian aid missions since 2014 to the Central African Republic, to Syrian refugees in Jordan, to Mali, and Yemen. Together, the partners have brought emergency aid that has saved more than 100,000 children’s lives.[86]

References

  1. 1 2 3 "Annual Report 2016" (PDF). Norwegian Air Shuttle. Retrieved 24 April 2017.
  2. ↑ "Norwegian become larger than SAS - Norway Today". Norway Today. 2017-02-07. Retrieved 2017-04-25.
  3. ↑ Her er Europas største flyselskaper, regnet etter passasjertall Verdens Gang 9.January 2013 (in Norwegian)
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  6. 1 2 Larsen, Trygve (13 October 2000). "Vil fly selv". Dagens Næringsliv (in Norwegian).
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  84. ↑ "A Flying Force for Good: Organizations and Airline Livery Combinations". AirlineGeeks.com. 2018-04-24. Retrieved 2018-05-18.
  85. ↑ "On Board Norwegian's UNICEF Dreamliner Flight to Djibouti". The Points Guy. Retrieved 2018-05-18.
  86. ↑ "Norwegian's Fourth Humanitarian Aid Flight with UNICEF Now on its Way for Yemen with Emergency Aid". Norwegian.com (Press release). Norwegian Air Shuttle ASA. 25 September 2017.

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