Norwegian Air Is Facing Collapse In 9 Days If It Does Not Secure More Capital

Its been a rough year for airlines. While we’ve seen Primera Air and Cobalt Air go bankrupt, we’ve also seen the likes of Flybe being put up for sale. There is also the poor financial performance of WOW to consider, and let’s not forget Jet Airways. There are a few factors which almost all of the airlines have quoted as reasons for financial difficulties. These include high oil prices and poor exchange rates. Now, the latest airline that looks like it could be facing financial difficulty is Norwegian Air.

Who Is Norwegian?

Over the past few years, Norwegian Air has boomed. This has largely been due to their rock-bottom prices on long-haul services. Something that departed rival Primera Air had also offered. The airline has recently launched a low-cost subsidiary in Argentina. Additionally, Norwegian is in the midst of a number of new aircraft deliveries. In fact, the carrier has even gone as far as trying to sell some of its new aircraft to raise funds. While this has been going on, the carrier has also suffered from a number of other inconveniences recently.

Norwegian
Norwegian is famous for its low transatlantic fares. Photo: Norwegian

Gatwick Drama

A large portion of Norwegian flights depart from London Gatwick. Now, it will come as no surprise that the airline has been affected by the recent disruption at the airport. All of the airline’s operations at the airport were suspended, prompting the airline to issue the following warning: “London Gatwick airport is currently closed and is affecting all flight operations in and out of the airport. We would advise our passengers not to travel to London Gatwick at this time.”

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As the incident was considered an extraordinary circumstance, no compensation is due to customers under EU regulation 261. However, Norwegian should’ve provided hotel accommodation for stranded passengers according to the BBC.

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Norwegian
Norwegian was forced to cancel a number of flights following the drone crisis at Gatwick Airport. Photo: Gatwick Airport

Other Issues

There are a number of other circumstances which have affected Norwegian. Earlier this year, the airline was forced to wet-lease an A380 during the B787 engine crisis. This led to a huge number of delays, as Norwegian’s flights were initially scheduled for a time when New York had reached its capacity for A380 aircraft. While Norwegian didn’t want to cancel all of their flights, they were losing money on each A380 flight that was operated. This is due to the cost of hiring the aircraft and the crew, combined with the super cheap fares on offer. While Norwegian should have paid compensation for each of these flights, the airline is alleging that the A380 flights were also delayed due to extraordinary circumstances.

Additionally, the Norwegian Air fleet is currently down an aircraft. One of the airline’s B737-Max is currently stranded in Iran following a fault that required an immediate landing. According to sources, repairing the jet won’t be easy, as US sanctions against Iran are resulting in difficulty exporting the spare parts. As such, A Norwegian Spokesperson told a Norwegian newspaper “It’s correct that the aircraft is still in Iran and it’s not yet been clarified when technicians can start their work”.

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Norwegian
Norwegian reportedly has just 9 days before a “full crisis” regarding its financed. Photo: Norwegian

9 Critical Days

The next 9 days are reportedly critical for Norwegian according to newspaper Dagens Næringsliv. The Norwegian newspaper reported on Thursday that the airline was just days away from a “full crisis” regarding its financial state. Due to large acquisitions of aircraft, the airline is currently in the midst of “heavy debt”. As such Martin Stenshall of Danske Bank believes that Norwegian’s loan terms will be violated by the new year. That means that lenders could demand immediate repayment. Mr Stenshall told DN “If the company has to report a violation of the conditions surrounding its debt, it can land in an evil spiral and the crisis will escalate.”

Do you think that Norwegian is in trouble? Let us know in the comments down below!

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Peter Fox

Dagens Næringsliv is a Norwegian newspaper.
The Boeing 737 Max 8 in SYG AirPort may be stranded but shound be covered by Insurance

Bill Bellichek

Argentina not Venezuela. Not sure how you get them confused

LK

The article did say Argentina!

Anders

Tom, You realy need to get your facts straight. 1) The airline have not launched in Venezuela! They have launched i Argentina and startet with one plane. They are now starting with two planes of a fleet of 165. 2) “In fact, the carrier has even gone as far as trying to sell some of its new aircraft to raise funds” Since Nas ordred the 220 planes back in 2012 the strategy have been to sell off the airbus order (100 planes) and older 737-800 planes when the new max`s where set in production. It was never the strategy to… Read more »

AF Kay

The demise of this airline, should it happen, would not surprise me, as it is really not a well run business. My wife and I were booked on a flight from BCN to EWR on 11/8/18. We got to the airport only to find the the flight had been cancelled. The counters were empty. We called and were told that we had been rebooked to the same flight two day earlier, all without our knowledge. We were left completely on our own. I wrote to them to demand a refund and have yet to hear back from them. You be… Read more »

Anders

AF Kay;

Too bad to hear that you have had a bad experience. But you also need to understand that one event is not representative out of millions of journeys every year.

Nas has been voted the best low cost company every year in the recent years so it is probably not be as bad as you experienced

Luana

I am quite concerned as I have booked this airline for a flight from Rome to LAX for myself and 11 others in April 2019.

Any advice?

Caleb Britton

I’ve also booked a flight to LGW in March…

Scott B

me too for October 2019 for 9 people

Me

NAS is the worst airline and employer i have ever worked for. They do not consider their crew at all, so why should they do so with customers. Many of you have bookings with them in the next coming months, by this time it is almost certain they won’t be flying anymore and if they still do so, do not expect to much from them, the service and assistance they provide is as low as their fares.

Anders

Me:

You do not appear to be a very credible party, but rather a bitter one.
That you are now trying to swear an old employer is just embarrassing on your behalf.

That Nas would go bankrupt is just nonsense!

Me

@ Anders i don’t feel embarassed at all, just telling what i think about NAS, maybe you think their bankruptcy would be a nonsense but regarding the huge debt, they are closer to bankruptcy than being profitable… i hope i am wrong but we’ll see what will happen

Anders

Me:

The good thing is that debt is tied up in liquid and coveted funds so that`s not very much to worry about. A JV or plaine sales of the planes they not attend to use them self will liberate a lot of capital.

A bankruptcy will not happen, in the worst case IAG will buy up the company

viddì

Well, I work for RYR and, trust me, NAS can’t be worst (nobody can’t).

kelly n

i am concerned and not sure what to do. due to fly from lgw boxing day until new year with my kids to jfk 🙁

Charbax

Norwegian airline is totally awesome. And don’t worry, Norway has the world’s biggest national sovereign wealth fund (due to all the oil that Norway stole from Denmark since 1976), there is no chance that Norway would let its pride airline fail, no way. They will borrow them more money, no problem. The Boeing 737max issues are very concerning for the industry. I think Norwegian should be buying more Airbus airplanes, most importantly they need to place a very large Airbus A380plus order and connect each of their hubs to their biggest long haul destinations around the world. Though the B787… Read more »

JJ

I worked for norwegian Air – only finishing at the end of of October 2018. The concept and ideology is great, but is so poorly managed. They hemorrhage money, with all the poor organisation of crew rosters and passive flights. I have hundreds example of Norwegian paying thousands unnecessarily due to poor management .. SUCH bad organisation from AOCC it was a running joke with crew. No concern for PAX or crew saftey – being the only flight flying from EDI in a snow storm, only to be hit by lightning and having to turn back. Crew being forced to… Read more »

Me

JJ you said it all ,
I guess it was the Norwegian way :-))
The concept is good but there is no management at all, for me it was my worst experience, in the airline industrie i gave up after 6 months

Me

@anders
I agree with you that someone will take over NAS and as you say probably IAG, maybe they will then merge it with Level

BERT

I hope and wish Norwegian Air all the best. I have been flying NA since it began serving SFO -OAK in 2014 to the EU.

Happy Contentment with Norwegian Air!!

Theo

It`s only a matter of time before Norwegian declares bankruptcy. I wouldn`t book a flight too far ahead with them and if you do, use your credit card as you may get a refund when they do go under. I flew Norwegian several times, never once on time..always delays. Seems a really chaotic airline. Won`t fly with them again.

Anders

Theo:

Can you explain to me why you know Nas are going in to bankruptcy?
I assume that you have a financial background and knowledge of the operation that others have not?

Lynne

Nothing but good things to say about Norwegian Air. We are very happy passengers and won,t hesitate to book with them again…..Go Norwegian!

I love norwegian

By flying Norwegian you save a lot of money, and don’t have to worry about your safety- which people often do flying with other lowfare airlines. And also they have great entertainment, just as good as expensive airlines. They should probably be more expensive tbh. Also- the Norwegian government wouldn’t let them go bankrupt, the worst thing that could happen to the airline is being sold- but the name and airline Norwegian will live on. They have a great concept that’s why the airline will be there in the future. I don’t know why people are complaining, you get a… Read more »

NASnoMORE

The strategy with NAS is clear. They do this all the time, first pump the value a much as you can, like promising a buyout. Second start shorting the value and trash it out with as many bad news as you can. This way they make money shorting their own company using someone else’s stock and crashing the small dumb money investor that thinks this company is going bankrupt (just like happened with Tesla last year for example). When the floor is reached. In this case like now around 97-90 area. Start o buy, buy buy and buy in a… Read more »

Gary Cone

I have flown Norwegian about 15 times since they started flights from FLL to Europe 6 years ago. I have flown the world on many airlines for many lines and consider Norwegian the best I have ever flown. I wish them the best. I am hoping to fly back to Florida from Spain in a month but will hold off on a reservation just in case. Good luck Norwegian. !

JJM Ford

Purchased Norwegian Singapore to London return. A month before departure i had a stroke, lost most my sight, My Doctor refused to sign me fit to fly, maybe in three months.
Contacted Norwegian to delay my departure, very slow to reply, no offer to reschedule departure. I was told that i would have to repurchase my tickets. Lost everything.
Norwegian refuse to engage in any discussion.
In my opinion Norwegian are a bunch of malignant thieves who should be in prison.
Run an air line? They couldn’t run a piss-up in a brewery, even a Norwegian brewery.
Cheers JJM.