Last Update: at 16:25

New CEO

Norwegian may boost long-haul offering

The loss-making low-cost airline recently reduced its long-haul offer. The new CEO of Norwegian now sees potential for new routes to Asia and more flights to America.

Norwegian

Boeing 787 of Norwegian.

Norwegian has a new CEO: Since January 1st Jacob Schram is the guy leading the budget airline to its future. The former manager of a chain of service stations awaits no easy task: he has to restructure an airline with lots of problems.

Due to lack of money, Norwegian was unable to repay debts last autumn. The company suffers also from the grounding of its Boeing 737 Max. And many of its Boeing 787 are currently on the ground due to engine problems. So it had to abandon its expansion and now is focusing on profitability rather than growth.

Potential in long-haul

In November, Norwegian announced the removal of Stockholm and Copenhagen from the long-haul network and a focus on other major European cities as departure airports for flights to the USA. In initial statements in mid-February, the new airline CEO Schram, did not appear to have adopted a clear course with regard to long-haul flights.

This now seems to be changing – and in favour of long-haul flights. Schram told the Swedish news agency TT that more flights to North America and new routes to Asia could be a long-term solution to Norwegian’s problems. Schram said he hoped for better profits from long-haul flights.

Still deep in the red

This statement is surprising: the industry still has serious doubts about the profitability of low-cost long-haul flights – especially with wide-body aircraft. Meanwhile, Norwegian hopes for improvement of its results thanks to lower oil prices. The airline also expects compensation payments from Boeing due to the flight ban for the Boeing 737 Max.

For last year, the budget airline again announced a deficit of approximately 1.7 billion Norwegian kroner or more than 169 million euros. Compared to 2018, however, Norwegian improved its result by about 80 million euros.

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