Posted on: 22 January 2019 by Kimberley Young
Norwegian has confirmed that it will close some of its bases in Spain, Italy and the US in 2019 in a move to improve profitability.
The company is reviewing its Boeing 737 operations (including the -800 and MAX models) as part of a cost-reduction programme aiming to improve profitability, reduce the commercial impact of seasonality and consequently increase revenue and cut costs.
As a result the company is planning to discontinue some routes and bases in Europe and the United States, commencing in April and continuing for much of 2019.
Norwegian has decided to close its bases in Palma de Mallorca, Gran Canaria and Tenerife in Spain; Rome Fiumicino in Italy; and Stewart and Providence in the United States. Rome’s long-haul Dreamliner base will continue to operate as planned, however.
“We are grateful to our crews at the affected bases for their hard work and commitment and our goal is to ensure that as few colleagues as possible will be affected,” said Norwegian’s chief commercial officer and managing director of Norwegian Air Resources, Helga Bollmann Leknes. “However, the company has reached a point where it needs to make necessary adjustments to its route portfolio in order to improve the sustainability and financial performance in this very competitive environment.”
She continued: “The decision about the route review has now been communicated to all the unions at Norwegian and we have already started the dialogue. We have a clear goal of avoiding redundancies and will offer affected crew transfers to our bases in Oslo, Stockholm and Madrid, or to our thriving Dreamliner-operated long-haul network.”
The changes to the route portfolio affects routes being operated by the Boeing 737-800 and 737 MAX 8 models which are primarily used on European routes, but also some longer routes between Europe and the US, and Europe and the Middle East. The Dreamliner operation is not affected by the changes.
Norwegian will also no longer base long-haul pilots in Amsterdam, the Netherlands; Bangkok, Thailand; or Fort Lauderdale, United States. The company says this will not affect cabin crew in these bases, nor translate in any decrease in the number of Dreamliner aircraft in operation.
Addressing the changes, the airline stated: “The closure of some of Norwegian’s crew bases will have little or no effect on already scheduled flights that are out for sale and customers who have booked flights with Norwegian. Norwegian will not stop offering flights to popular vacation destinations such as Las Palmas, Mallorca and Thailand.”
Looking back on 2018
The airline reported its highest passenger figures in a single year in 2018, with more than 37 million passengers and a load factor of 86%. While the year saw the launch of 35 new routes, the delivery of 25 brand new aircraft and major investments, the airline also reported “strong competition” and high oil prices.
With its year-end results, the airline revealed its plan to implement a series of cost-reduction measures to boost its financials in 2019, Norwegian CEO Bjørn Kjos commented: “The company has made considerable investments this year and will now enter a period of slower growth.
“We have adjusted and optimised our route portfolio and the capacity going forward. We have also made seasonal adjustments for the winter.”
Kjos added: “Continued tough competition, high oil prices and operational challenges in 2018 combined with the issues with Rolls Royce engines, which have particularly affected our long-haul operations, have had an impact on our financial results in the latter half of 2018. We have launched a series of cost-reduction measures to boost our financials in 2019 which will have an immediate and continued positive influence throughout the year.”