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It isn’t news that the global pandemic has been disastrous for the airline industry, but it’s worth remembering that even when it comes to disasters there are varying levels of severity. For some airlines, this crisis has been significantly more disastrous than for others, and Norwegian is one airline that’s among those that have been hit the worst.
Norwegian is an airline that I have a soft spot for because it’s a low-cost airline that has been a thorn in the side of the major carriers for years and it’s a big reason why airlines like Delta, American, British Airways, Air France and Lufthansa haven’t been able to significantly increase the prices they charge to fly across the Atlantic – they’ve had to compete with Norwegian.
The Norwegian business model has been suspect for some time (its cash burn has often been ridiculously high) but it was also a little unlucky to be significantly affected by the issues surrounding the Rolls Royce Trent engines that propel a significant number of its 787 Dreamliners. Long before the pandemic hit, Norwegian had been forced to restructure its business a number of times and to get significant help from its creditors to keep its operations going…but the airline survived. Somehow.
The pandemic, however, appears to have been one challenge too many for Norwegian and the airline is now almost unrecognizable. The Planespotters.net fleet facts for Norwegian shown that all of the airline’s 35 Dreamliners are currently grounded as are 74 of its 89 Boeing 737s. Right now, Norwegian appears to have just 15 active aircraft and according to the traffic figures the airline released today, it operated just 9 aircraft (on average) in December.
Here are a few stark statistics from Norwegian’s December operations:
- The number of passengers that flew with Norwegian in December 2020 represented a 94% decrease on December 2019.
- Norwegian’s capacity in December 2020 was down by 98% on December 2019.
- Norwegian’s load factor in December 2020 was just 52.3%, down by 31% on December 2019.
In releasing these figures, Norwegian’s CEO had this to say:
“The pandemic continues to have a negative impact on our business as it has had since March 2020. At the beginning of last year, Norwegian was headed for a positive result in 2020, instead 2020 has been a very challenging year and we now find ourselves fighting for survival. Despite low demand in December, Christmas bookings were positive, and we have succeeded in adapting our operations to the current situation. Our goal is to be a financially strong and competitive airline, with a new financial structure, a rightsized fleet and improved customer offering.”
“The support from our customers, employees and suppliers this past year has been extraordinary. We all wish to travel and meet our friends and loved ones again and at Norwegian our focus continues to be to connect people in a safe and comfortable way. The vaccination is now being rolled out across the world and is good news for both the aviation industry and those who want to travel. We will be ready to meet the competition for customers after the COVID-19 pandemic. 2020 has been a tough year, but we will continue to fight and come out of this crisis as a stronger Norwegian”
The few positive sentiments in that statement are nice to read but one has to wonder what chance Norwegian really has of getting out of this mess.
Realistically, between now and the end of April, most countries will not be able to vaccinate more than their key workers and their more vulnerable citizens, so with the virus now mutating and spreading quicker than ever (in some regions), we’re unlikely to see any kind of significant uptick in European or transatlantic air traffic much before the summer…and even then the number of people traveling will be nowhere near the numbers that were traveling in the summer of 2019. Personally, I don’t expect to see any kind of significant uptick in numbers before 4Q this year.
Norwegian’s problem is that it doesn’t just need people to start flying again, it needs a LOT of people to start flying again if it is to remain in business as a major transatlantic player and that’s not going to happen any time soon. I really hope that things get better for Norwegian (sooner rather than later) as I think it has a significant role to play in keeping travel equitable, but I’m struggling to see how it will get itself out of the mess that it’s currently in.
Going from operating over 100 aircraft and hundreds of daily flights to operating just 9 aircraft per day is easy. It’s called having a disaster. Going from 9 flights per day to where Norwegian once was is a completely different matter and, sadly, I cannot see it happening. As things stand, this is probably going to be one miraculous escape attempt too many for Norwegian.
Featured image courtesy of Norwegian