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
Fleet size 109
Destinations 126
Headquarters “Diamanten” (The Diamond) building
Fornebu (Bærum), Norway
Key people Bjørn Kjos (CEO)
Bjørn H. Kise (Chairman)
Website norwegian.com

Norwegian Air Shuttle ASA (OSE: NAS), trading as Norwegian, is the third largest low-cost carrier in Europe, the second-largest airline in Scandinavia, and the ninth-largest airline in Europe in terms of passenger numbers.[1] 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 24 million people in 2014.

As of July 2015, Norwegian operates 100 aircraft of which 92 are Boeing 737s and 8 are Boeing 787 Dreamliners, and is known for its distinctive livery of white with a red nose, with individual portraits of noteworthy Scandinavians on the aircraft's tail fin.

Norwegian launched its long-haul operation in May 2013. In line with the majority of Norwegian's operations, the long-haul flights are operated by two fully owned subsidiaries. Norwegian Long Haul is a legally separate entity with two unique AOC but shares branding and commercial set-up with the rest of the Group. Many flights previously operated by Norwegian Air Shuttle are now operated by the Irish-based Norwegian Air International, under the new Norwegian Air International AOC, using the IBK ICAO code to distinguish these flights. These are operated using Norwegian's Irish registered aircraft. Crew bases for the long haul Boeing 787 fleet are at Bangkok (BKK), New York (JFK), London Gatwick (LGW) and Fort Lauderdale (FLL).

History

The routes operated on behalf of Braathens in Western Norway during the 1990s
A Fokker 50 operated by Norwegian Air Shuttle in 1999

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 for charter. This included the network of regional services between cities on the west coast of Norway operated on wet lease for the mother company. Following the bankruptcy, 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.[2][3] It was based in Bergen, but later established a technical base in Stavanger.[4]

From 1 April 1994, the airline also began service from Bergen to Ålesund Airport, Vigra.[5] 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.[6]

By 1999, the company had six Fokker 50s and flew 500,000 passengers on 20,000 flights.[4][7] 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.[7] 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.[8]

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 where the airline did not wet lease the aircraft to Braathens, but instead operated the route on their own risk. After Braathens was bought by Scandinavian Airlines System (SAS) in November 2001, all the contracts for the routes on the Norwegian west coast that Norwegian had with Braathens, were cancelled by SAS, who wanted their subsidiary SAS Commuter to take over. NAS had an 18-month cancellation period in their contract with Braathens, however this was not respected by SAS, who terminated the contracts without any notice.[9]

Low-cost carrier – 2002 onwards

Boeing 737-300 taxiing to the runway, with Henrik Ibsen fin
Norwegian previously operated seven McDonnell Douglas MD-80 inherited from FlyNordic

Following the decision by SAS to purchase Braathens, and the subsequent termination of all the contracts between Braathens and NAS, NAS announced in April 2002 that it would start domestic scheduled services as a low-cost carrier on the most busy routes. From 1 September 2002, the airline re-branded as Norwegian.[10]

The airline opened their second hub at Warsaw Frederic Chopin Airport in Poland, flying to Central European destinations. There were two Boeing 737 operating from Warsaw.[11] The base was closed in 2010. Norwegian Air Shuttle ASA announced 24 April 2007 that they 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 got a 5% share stake in Norwegian.[12]

In February 2008 Norwegian announced their first destination outside Europe, non-stop to Dubai from Oslo-Gardermoen and Stockholm-Arlanda.

After the bankruptcy of competitor Sterling Airlines, Norwegian announced that they would open a new hub at Copenhagen Airport and service the most profitable routes. Flights to Aalborg and Stockholm as well as additional flights to Oslo would start immediately, with flights to London, Amsterdam and Rome to follow "shortly after".

On 30 August 2007, Norwegian ordered 42 new Boeing 737-800 aircraft, with an option for 42 more, an order worth US$3.1 billion.[13] This order was later increased by 6 aircraft in November 2009. In July 2010 15 of the options were called, and in June 2011 15 more options were called, bringing the total order of new, owned 737-800's 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. It was registered LN-NOB,[14] and has a tail picture of the Norwegian composer Edvard Grieg. The plane made its first scheduled flight on 1 February. As of August 2013, the number of leased 737-800 aircraft has increased to 29. The first owned 737-800 from the 30 August 2007 order, registered LN-DYA,[15] arrived in Oslo in August 2009. This aircraft was given the tail hero of Norwegian artist Erik Bye.

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.[16][17]

In October 2009, Norwegian announced it intended to start flights from Oslo to New York 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.[18] On 8 November 2010, Norwegian announced that it had contracted to lease two new Boeing 787 Dreamliners from International Lease Finance Corporation, with delivery in 2012, and that it was negotiating the leasing of additional aircraft.[19]

On 25 January 2012, Norwegian announced the largest order of aircraft in European history. The order consists of 22 Boeing 737-800 and 100 Boeing 737 MAX 8 with an option for another 100 for the latter. Also, it included an order for 100 Airbus A320neo and an option for another 50 Airbus A320neo.[20]

In late October 2012, the airline announced a new base in 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 like easyJet, Monarch, Ryanair and Thomson Airways. Gatwick is also served by Norwegian from a large number of cities in Scandinavia.[21]

Corporate affairs

Bjørn Kjos, Norwegian's CEO and largest shareholder

The company is headed by CEO and largest shareholder Bjørn Kjos, and the board is chaired by Bjørn H. Kise.[22] 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.[23] Previously, the airline had its head office functions inside other buildings in Fornebu,[24] but in 2010 moved to Diamanten, which had been the former Braathens, and later SAS Norway, head office.[23]

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 European Low Fares Airline Association.

Business trends

A Norwegian Boeing 737-300 takes off from Prague Václav Havel Airport

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

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Turnover (MNOK) 959 1,210 1,972 2,941 4,226 6,226 7,309 8,598 10,532 12,859 15,580 19,540
Profits (EBT) (MNOK) −43 −110 39 −32 113 5 623 243 167 623 437 −1,627
Number of employees (FTE at year end) 374 445 560 882 1,417 1,596 1,852 2,211 2,555 2,890 3,738 4,314
Number of passengers (M) 1.2 2.1 3.3 5.1 6.9 9.1 10.8 13.0 15.7 17.7 20.7 24.0
Passenger load factor (%) 62.5 66.8 78.0 78.6 80.1 78.7 78.2 77.4 79.3 78.5 78.3 80.9
Revenue/RPK (Yield) (NOK) 0.8 0.7 0.68 0.67 0.67 - - - - 0.55 0.50 0.43
Revenue/ASK (RASK) - - 0.56 0.54 0.52 0.49 0.47 0.40 0.42 0.43 0.38 0.35
Number of aircraft (at year end) 8 11 13 22 32 40 46 57 62 68 85 95
Notes/sources [25] [25] [25] [25] [25] [25] [25] [26] [25] [27] [28] [29]

Destinations

Destination map

Norwegian serves Europe, North Africa and the Middle East for both business and leisure markets. In total the airline operates 416 routes to 126 destinations in 35 countries on four continents.

Domestic, intra-Nordic and typical European business and leisure destinations have the most frequencies. The busiest routes in Norwegians 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.

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

Long-haul operations

Main article: Norwegian Long Haul

Norwegian started long-haul flights on 30 May 2013.[30] The first scheduled flights are from Oslo and Stockholm to New York City and Bangkok, originally with wet-leased A340-300 aircraft while the airline awaited delivery of the new Boeing 787 Dreamliner aircraft. In March 2013 Norwegian Air Shuttle confirmed a new long haul route from Copenhagen, Oslo and Stockholm to Fort Lauderdale, beginning on 29 November 2013.[31] In September 2013, Norwegian announced flights from Oakland to Stockholm and Oslo, beginning in May 2014,[32] as well as Copenhagen-Los Angeles, Copenhagen-New York, Stockholm-Los Angeles, Oslo-Los Angeles, Oslo-Orlando and Bergen-New York (JFK)

Norwegian Long Haul also operates between London Gatwick to New York (JFK), Fort Lauderdale and Los Angeles.

The airline announced in April 2015, the beginning of flights to San Juan, Puerto Rico (US Territory) from Oslo, Copenhagen, Stockholm and London Gatwick beginning in November 2015. Also announced were flights to St. Croix, US Virgin Islands from Copenhagen beginning in November 2015.

The airline also plans on flying to India, Durban, Cape Town and Hong Kong soon.[33]

International network

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.[34]

Fleet

Short haul

As of September 2015, Norwegian Air Shuttle's short haul fleet consists of the following aircraft:[35][36][37]

A Norwegian Boeing 737-800
Norwegian Short Haul fleet
Aircraft In Service Orders Options Passengers Notes
C Y Total
Airbus A320neo — 100 50 — 168 168 EIS: 2016
Boeing 737-800 96 33 6 — 186
189		 186
189		 46 planes owned, 42 planes leased.[37][38]
Boeing 737 MAX 8 — 100 100 — 186 186 EIS: 2017
Total 96 233 156

In 2013, Norwegian Air Shuttle received 14 new Boeing 737-800s. For 2014 and 2015 the corresponding figures are 14, and 11, respectively.[39]

Norwegian's aircraft livery is white with a signal red nose. The vertical fins of the aircraft in Norwegian's fleet feature depictions of historically significant Norwegians, Swedes, Danes and Finns.[40] Norwegian has also operated a single aircraft in a special promotional livery for the insurance company Silver.[41]

Long haul

Main article: Norwegian Long Haul
Norwegian Long Haul Boeing 787 on approach to Gatwick Airport in July 2013

As of October 2015 Norwegian Long Haul's fleet consists of an all-Boeing 787 fleet:[42]

Norwegian Long Haul fleet
Aircraft In Service Orders Options Passengers Notes
C Y Total
Boeing 787-8 8 0 2 32 259 291 EI-LNA and LN-LNB are leased from DP Aircraft,[43] LN-LNC, LN-LNE and EI-LNH are owned through DY7 Aviation Ireland Limited[38][44] LN-LND, LN-LNF and LN-LNG are leased from Wilmington Trust (Dublin).
Boeing 787-9[45] 0 30[46] 10 35 309 344 11 orders will be leased from MG Aviation and ILFC. Entry into service Q1 2016[47][48][49][50][51]
Total 8 30 12

Historical fleet

A Fokker 50 at Trondheim Airport, Værnes in 1999

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 Total Introduced Retired Ref
Boeing 737-300 26 2002 2015 [52][53]
Boeing 737-500 1 2002 2003 [52][53]
Fokker 50 7 1992 2004 [52][54]
McDonnell Douglas MD-82 5 2008 2009 [52][55]
McDonnell Douglas MD-83 3 2008 2009 [52][55]

Operations and services

Norwegian Air Shuttle Boeing 737-800 cabin Sky Interior

All flight operations are performed under one single air operator's certificate (AOC) (ICAO airline designator NAX). The Group also held one 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 purchases all aircraft ground handling from a third party; in Norway, Aviator Airport Alliance, former Norport Handling and Røros Flyservice.

Norwegian, as a low-cost airline, operates aircraft with all-economy class seating. Surcharges are taken for on-board food and drinks, check-in baggage, payment by credit card and other non-core services.[56]

The airline runs two frequent flyer programs: Norwegian Reward is for travellers, who earn cash points based on a percent of cash paid for tickets and the ticket class (10% on full fares, 2% on discounted fares). Corporate Reward allows companies to redeem cash points on a similar basis. 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.[57]

Norwegian also offers free WiFi in its 737-800 fleet.[58]

Awards

In 2009, Norwegian CEO Bjørn Kjos received the annual leadership's prize "Kunsten å lede" from Manpower Inc. and HR Norge.[59] Kjos was also awarded the Ernst & Young Entrepreneur of the Year Award for Norway in 2009.[60]

Norwegian was awarded best European low-cost airline and fourth worldwide in 2014 by AirlineRatings.com. In 2013 Norwegian was voted best low cost airline in Europe by Skytrax.[61][62]


Customer service related criticism

Norwegian Air customers have lodged a record number of complaints, with a tribunal judge stating to the Dagens Næringsliv, "We have never before seen this scope of complaints in a single case."[83] With more than 200 complaints having been registered with the Transport Complaints Board alone, passengers have created the Twitter hashtag, #NeverFlyNorwegian.[84]

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 correct type of credit card).[85] In August 2014, 35,000 people were reportedly hit with delays when flying with Norwegian, and 1,200 passengers ultimately sued Norwegian for compensation.[86]

However, for the most part, the tribunal has not agreed with the complaints and only in a few cases has Norwegian had to compensate the passenger(s).[87][88][89]

Labour related criticism

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.[90][91]

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.[92][93]

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.[94]

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.[95][96]

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.[97]

Norwegian Long Haul

Norwegian has also received criticism for the terms of its contracts with its long-haul flight-attendants, who are on contracts based in Thailand.[98] 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 [99] 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).[100]

References

  1. ↑ Her er Europas største flyselskaper, regnet etter passasjertall Verdens Gang 9.January 2013 (Norwegian)
  2. ↑ "Norwegian Air Shuttle på ruinene etter Busy Bee" (in Norwegian). Norwegian News Agency. 27 January 1993.
  3. ↑ Valderhaug, Rune (28 January 1993). "Nytt selskap flyr fra Bergen". Bergens Tidende (in Norwegian).
  4. 1 2 Larsen, Trygve (13 October 2000). "Vil fly selv". Dagens Næringsliv (in Norwegian).
  5. ↑ Valderhaug, Rune (20 January 1994). "Braathen vil ikke fly direkte Bergen Nord-Norge" (in Norwegian). p. 6.
  6. ↑ Sæthre, Lars N. (24 August 1996). "Nye aktører kjemper om Widerøe-nett". Aftenposten (in Norwegian). p. 27.
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  92. ↑ "Pilot-opprør mot Kjos". Dagens Næringsliv (in Norwegian) (dn.no). 4 April 2011. Retrieved 22 December 2013.
  93. ↑ "Vi ansetter ingen i Norge". TDN Finans (in Norwegian) (dn.no). 19 May 2011. Retrieved 22 December 2013.
  94. ↑ "Norwegian saksøkes av sine egne piloter". Dagens Næringsliv (in Norwegian) (dn.no). 16 September 2012. Retrieved 22 December 2013.
  95. ↑ "Norwegian vil vingeklippe piloter før streik". Dagens Næringsliv (in Norwegian) (dn.no). 22 October 2013. Retrieved 22 December 2013.
  96. ↑ "Piloter varslar om sympatistrejk". Svenska Dagbladet (in Swedish) (Stockholm: TT/SvD.se). 31 October 2013. Retrieved 22 December 2013.
  97. ↑ Karlsson, Josefin (19 December 2013). "Norwegian säger upp kabinpersonal i Sverige". Aftonbladet (in Swedish) (Aftonbladet.se). Retrieved 22 December 2013.
  98. ↑ "Parat: - Sosial dumping i Norwegian". NTB/Dagens Næringsliv (in Norwegian) (dn.no). 30 October 2013. Retrieved 22 December 2013.
  99. ↑ "Flight Attendants". dn.no. 9 September 2008. Retrieved 10 May 2015.
  100. ↑ "Forsiden". dn.no. Retrieved 10 May 2015.

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