The budget airline has cut back on its ambitions. Therefore it no longer wants the last 92 Boeing 737 Max and five Boeing 787. But the cancellation itself is not enough for Norwegian.
When things were still going well, ambitious growth plans were forged in Oslo. Norwegian Air Shuttle ordered 110 Boeing 737 Max and wanted to expand its route network with the new, efficient aircraft. But then the low-cost airline was hit by three setbacks: It suffered financial problems itself, the 737 Max was grounded and finally the corona crisis brought operations to a halt.
The airline can therefore no longer use the many aircraft it ordered and can no longer pay for them. Boeing has been informed that they will not accept the remaining 92 737 Max, Norwegian announced on Monday evening (June, 29). The airline had received 18 aircraft until the worldwide grounding in March 2019.
Last five Dreamliners cancelled as well
Not only does Norwegian not want the remaining 737 Max anymore. The Norwegians also want to cancel the five remaining 787 Dreamliners. They also want to cancel the service contract for the planes, according to the announcement.
Norwegian has more to discuss with Boeing, however. The grounding of the 737 Max had «disrupted operations and caused considerable losses», the company said. At the same time, the problems with the reliability of the Dreamliner’s Rolls-Royce Trent engines had also led to operational disruptions and losses, it continues. Norwegian wants to be compensated for this.
Talks are in progress, but…
Discussions on compensation are already underway. However, no agreement has yet been reached on «reasonable» compensation. At the same time, Norwegian has taken legal steps to recover advance payments for the ordered aircraft.
Norwegian’s creditors and shareholders agreed in May to a restructuring plan which will ensure the airline’s survival for the time being. Nevertheless, it intends to keep the majority of its fleet on the ground until March 2021. Until then, it plans to operate a minimum flight plan on short haul routes.