Norwegian plans further growth from London ahead of expected losses.

The low cost carrier, Norwegian, held a media event yesterday announcing a further significant expansion of operations from the UK, and London Gatwick in particular.

This comes fairly recently after their last announcement of route expansion from London, back in July 2017.

They are going to expand routes to both South America and Asia:

The airline is exploring potential new routes to more South American countries due to strong ticket sales on the Buenos Aires route. Further Asia expansion will build upon the successful launch of the world’s longest low-cost route to Singapore with destinations such as Tokyo, Shanghai and Beijing planned if the airline receives access to the Siberian corridor.

There will be long-haul routes using the new A321LR.  This is Airbus’s answer to the elderly Boeing 757 and can seat up to 240 odd people, for transatlantic flights.  These are perfectly fine aircraft for a short hop in Europe, but I could imagine long-haul at six hours plus would be particularly unpleasant.  However they said:

Eight brand-new Airbus A321neo LR will land in Norwegian’s fleet in 2019 and will serve the UK from 2020. The A321neo LR will be Norwegian’s first Airbus aircraft to fly in its fleet as plans are underway to use these aircraft from London to the US East Coast and Midwest. Cities such as Detroit, Philadelphia and Minneapolis are examples of destinations that could be served. Norwegian will also consider routes to the Middle East using the Airbus A321neo LR.

There was also a focus on the higher end of the market.  Their newest aircraft have a larger premium economy cabin, and these aircraft will be the ones based in the UK as well as high-speed internet connectivity:

10 brand new Dreamliners entering the fleet in 2018, will feature the new expanded 56-seat Premium cabin, which will replace the current Gatwick-based Dreamliner fleet, giving UK passengers more premium seats and brand-new aircraft at less than a year old. Long-haul Wi-Fi will be rolled out from the end of this year on the Boeing 787 Dreamliner and Boeing 737 MAX aircraft with plans to offer a free Wi-Fi option and a paid high-speed option, fast enough to stream movies and TV shows.

Finally, there’s also going to be a focus on business travellers by increasing frequencies on their existing routes as well:

While the airline will add 21 more Premium seats to its 787 Dreamliners, with lounge access included with Premium tickets, Norwegian also has plans to increase frequency on key routes from Gatwick to give business customers more flexibility. London-Buenos Aires will increase to a daily service this winter, while further increases to Los Angeles from nine to 11 flights per week and an increase from two to four weekly flights to Fort Lauderdale (Miami), are also planned. Norwegian also has long-term ambitions to secure slots for a triple-daily Gatwick-New York service.

If you look at the combined British Airways / American Airlines presence on London to JFK, they’re at around 15 daily rotations, however American by themselves only have three flights a day, so that could certainly be an interesting number, if they’re able to fill the aircraft profitably, and if they’re able to get a hold of the right slots, at the right times.  That’s going to be the most challenging.

The bad news however is coming tomorrow with the release of their 2017 financial results.  Bloomberg is reporting that they are likely to report a loss of about 1.43bn NOK (around £130m / €147m) due to a number of issues, notably around a staffing snafu, similar to that of Ryanair.

There have been persistent reports about Norwegian’s long-term financial strength, with Willie Walsh, CEO of IAG calling out them and Monarch as the two airlines most likely to go bust this winter.  Monarch of course did, however Norwegian still seem to be with us. If they can improve their operational performance compared to 2017, then they may well prove Willie’s predictions wrong.

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