Will Ryanair Kill Norwegian?

The reality TV show-esque relationship between Ryanair and Norwegian intensified this week. The Irish carrier’s full frontal assault on Norwegian may seem funny but could do real damage. Many argue that this is just another tactic by CEO Michael O’Leary to grab headlines. But until the dust settles, we won’t know if this dog’s bark is worse than its bite.

Ryanair to kill Norwegian in an old-school dogfight

It’s no secret that the European low-cost rivals Ryanair and Norwegian are often fighting for the same money. Both airlines offer wide-reaching, competitively priced flights. The only difference seems to be in their reputation.

Ryanair regularly grabs headlines for all the wrong reasons. This week it could be pilot strikes, next week standing only planes. But Norwegian regularly rates highly among its passengers and users. While it’s true, there has been some backlash against their code sharing practice with the Spanish carrier, they are still solid.

So O’Leary’s latest outpouring towards Norwegian, suggesting they’re heading for failure, is worrying. The carrier was once a good buddy of the Scandinavian Viking, but now could best be described as a Frenemy. The acerbic CEO launched an attack claiming the airline was riddled with issues. First, he suggested Norwegian cheated over pilot recruitment and now he’s saying, they’re doomed!

Fuel price issues could hurt Norwegian

While it’s true Norwegian’s finances have come under increasing scrutiny lately, they are hardly bankrupt. That rival airlines are contemplating a bid tells us the company still has value. But the Ryanair boss is more than happy to throw fuel on the fire, so to speak. He claims they took a risky bet on fuel price and it will be their undoing.

Ryanair cancelled more than 2,500 flights in the first quarter of this year and came under heavy criticism for failing to compensate passengers

But he really put the knife in when he suggested Ryanair was waiting for its rival to fold. Basically saying they intend to take Norwegian’s routes before making new fleet plans. But while the Ryanair and Norwegian tiff sounds one-sided, the Irish carrier has more than it’s fair share of issues too.

Ryanair cancelled more than 2,500 flights in the first quarter of this year and came under heavy criticism for failing to compensate passengers. It countered the backlash by promising to process all future compensation in 10 days. However, in the latest round of strikes has refused point blank to compensate any.

Sadly, the once tolerated low-cost, but mostly on-time flier is not as well stomached anymore. The travelling public has grown tired of the bravado and broken promises. But O’Leary hasn’t learned. Last week he went on record saying, “Alitalia continues to be loss-making, SAS is loss-making, Norwegian is doomed. All going under.”

Norwegian-737
Norwegian-737

But despite this tirade, we can’t ignore the facts. The Oslo-based airline, who has previously offered $99 flights between Europe and the U.S does have a fuel issue. They bet on the price going down and didn’t buy their usual stock in advance. Norwegian typically hedges half its fuel needs but decided not to last year. Now with kerosene prices already on the rise, we have to wonder where the cash will come from.

We hate to say it, by O’Leary could be right.

2
Leave a Reply

2 Comment threads
0 Thread replies
0 Followers
 
Most reacted comment
Hottest comment thread
2 Comment authors
newest oldest most voted
Hein

Norwegian’s problems may stem from its strategy to fly long haul as a LCC. This has proven an issue for many LCCs, with some exceptions e.g. Jetstar flying from Oz to Bali, Japan etc – admittedly using the latest fuel-efficient (though capital intensive) equipment, in this case B787-8s. O’Leary/Ryanair (and EasyJet) have perhaps been wise to stay away from long haul, and where possible from primary hub airports, all expensive stuff compared to secondary airports. Having said that, I believe that Norwegian will survive as it has a good product and a great reputation, which cannot be said for Ryanair… Read more »

Patrick O'Sheamus

BeJesus, the blathering of this Irish midget gbrings a smile to me face, O’Leary needs to get his own house in order before backstabbing his rivals, to be honest with ya, I wouldn’t go on a Ryanair flight even if it was free, he’d want to charge you to deplane. Basically the man’s a egomaniac and should have been closed down years ago