On Tuesday, budget carrier Norwegian announced its passenger numbers for September. Only 319,370 people flew with the airline last month, a decrease of 90% compared to the previous year. Norwegian said that new and stricter travel restrictions across Europe were to blame for the low demand.
While the European market looked like it could be making a relatively speedy recovery, the second wave of coronavirus infections sweeping the continent has dampened the cautious optimism of the past couple of months. As reinstated and stricter travel restrictions once more rolled out across European nations, September passenger figures were generally lower than airlines had hoped for.
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Frequent changes in restrictions to blame
Numbers were particularly dismal for troubled low-cost carrier Norwegian. Only 319,370 customers chose to fly with the airline in September. This was a decrease of 90% from the same month last year. The overall capacity last month was down by 93%, and the total passenger traffic by 96%.
“In September several European countries were classified as ‘red’ by the authorities. We have seen that as soon as the authorities impose new travel restrictions demand is immediately impacted. We are continuously adapting our route network in line with changing demand, but the frequent changes in travel restrictions make forward planning difficult, both for us and our customers. Looking ahead, this continues to be a prolonged crisis that is far from over,” Jacob Schram, Norwegian’s CEO, said in a statement.
While the budget carrier’s schedule is but a shadow of its former self, it operated 99.2% of its scheduled departures last month, 97.6% of which departed on time.
On an ordinary, pandemic-free day, Norwegian flies over 500 routes to 150 destinations worldwide. However, this spring, the carrier only operated a few domestic flights in Norway, subsidized by the Norwegian Government and, at times, carrying no more than one person on board. While it has added close to 45 destinations back to its current network, schedules remain sparse.
Close to collapse
While not in the best of financial conditions heading into 2020, the ongoing crisis has pushed the struggling carrier to the brink of extinction. In March, it received a $275 million bailout from the Norwegian Government to avoid going under.
Meanwhile, in August, the Swedish National Debt Office rejected Norwegian’s request for a state credit guarantee, on the grounds that it was not deemed to have been financially viable at the end of 2019. The budget airline commented at the time that “clearly, competition is not something that is desired in Sweden.”
Nationalization despite loan extension?
Late last month, the Norwegian Government extended loan guarantees for all carriers based in the country, including Norwegian Air. However, As the aviation crisis shows no signs of abating, and numbers remain abysmally low for Norway’s largest airline, more funding is needed to keep the company afloat. Norwegian is reportedly in discussions with the Government over a partial nationalization to help see it through.