Norwegian has announced the end of transatlantic flights between Ireland and North America, effective from the 15th of September. The short-notice move comes at a time of drastic financial and operational pressures and amid recent management changes at the airline. The route shift is set to impact several thousand customers.
In a press release, the airline’s SVP of Long-Haul Commercial, Mathew Wood, said the cuts came after a comprehensive review, eventually leading to the conclusion that these routes were no longer commercially viable. Indeed, the Irish transatlantic market, which Norwegian has been an active member of since 2017, is a competitive one.
On one hand, Ireland’s first airport, Dublin, is the home of IAG airline Aer Lingus. The Irish hybrid flag carrier operates numerous flights to destinations such as Chicago, New York, and Los Angeles.
On the other hand, many North American airlines, such as US based carriers United, American, and Delta, in addition to Canadian airlines Air Canada, WestJet, and Air Transat, each operate flights to their respective hubs and focus cities.
As well as the competitive point-to-point services to and from Dublin, customers can additionally connect at continental European hubs with relative ease.
While Norwegian plans to continue flights from Dublin to Oslo, Stockholm and Copenhagen, it will cut services from Cork, Shannon, and Dublin flights to New York, Providence and Hamilton, Ontario.
The MAX is to blame
In the press release, Mr. Wood pointed to the global 737 MAX grounding as a contributing factor in the decision to end Irish transatlantic flights.
“Since March, we have tirelessly sought to minimise the impact on our customers by hiring (wetleasing) replacement aircraft to operate services between Ireland and North America. However, as the return to service date for the 737 MAX remains uncertain, this solution is unsustainable.” – Matthew Wood, SVP Long-Haul Commercial at Norwegian
While we reported that Norwegian wassuffering from the 737 MAX groundings back in July, the extent of the challenges was not yet known at the time. Although the airline had suspended flights to and from Shannon, Ireland back in June, it seems that extensive wet-leasing became too expensive for the low-cost carrier.
Indeed, the 737 MAX groundings have caused some serious headaches for the airline. Aside from route closures, the groundings have invariably had a detrimental impact on the airline’s growth plans and finances.
Not only had the airline ordered over 100 aircraft from the American manufacturer, but Bloomberg also reports that the groundings are costing the airline between US$568,00 to $1.76m per day. Such a financial impact has even led Norwegian to request financial compensation from Boeing.
Expansive growth, challenges, and subsequent cuts.
For the past few years, Norwegian Airlines has been one of the fastest-growing airlines in the world. Not only has the airline been able to tap into the European short-haul market, but has also achieved a commendable position at London’s Gatwick airport.
That said, many financial analysts have repeatedly expressed concerns over the airline’s ability to break into the highly-lucrative transatlantic market. Back June 2018, one unnamed analyst told the Financial Times that Norwegian could “go bust in the autumn.”
While Norwegian did not go “bust” this past autumn, the airline has cut numerous routes outside of Ireland. Additionally, winter 2019-20 is also set to see some significant reductions, with the airline announcing 100s of route cancellations for the upcoming season.
A spokesperson for Norwegian told Simple Flying that the airline had no further comment on the matter.
What do you think of these developments? Is the low-cost long-haul model invariably challenging for airlines? What do you think the future holds for Norwegian? Let us know in the comments.