Austin Gets a Surprising New Transatlantic Flight

The Austin airport teased a new route announcement coming this morning.

This one was a bit vexing. The airport has been looking to hand out subsidies for new international routes. It was widely anticipated that, with Delta making Austin a focus city, we’d see a transatlantic flight to either Amsterdam or Paris and Delta joint venture partner KLM announced Amsterdam last month.

That meant Austin would have transatlantic service from each of the global alliances – London Heathrow on British Airways, Frankfurt on Lufthansa, and Amsterdam on KLM – plus London Gatwick on Norwegian. It didn’t seem likely to me that my home airport would get another transatlantic flight at this point – none of the alliances would add a transatlantic flight yet. Lufthansa just started service this year, KLM hadn’t started yet, and oneworld wouldn’t go anywhere other than Heathrow.

South America didn’t make sense. The Delta/LATAM partnership is too new. United’s partner Avianca is struggling so seemed unlikely to expand to Austin. And American, lacking a South American partner, isn’t one to do anything other than hub flying from even important spoke cities like Austin.

The only ‘game changing’ routes then seemed like Asia (Korean) or Hawaii but those weren’t likely either. Spirit just announced their route expansion, even beating American to the punch with Austin – Cancun service.

So I was genuinely stumped – in my home market. That wasn’t a great feeling. Well, Airline Route broke the story ahead of the announcement: Norwegian will be lauching Austin – Paris service. (HT: @IshrionA)

I suppose that was the most likely transatlantic flight, but I didn’t expect Norwegian’s expansion at a time when they’ve been pulling back on growth to control costs and stay alive.

Norwegian announced a pre tax $241 million quarterly profit today. That’s in the high-performing summer quarter, and they expect slightly lower earnings for the full year than previous guidance.

They’ve reduced their growth substantially as part of significant cost cutting, down from 48% available seat growth in the second quarter of 2018 to just 3% in the last quarter. Capacity is constrained heavily by the Boeing 737 MAX’s grounding. And they’ve just taken China Construction Bank as a joint venture partner. That reduces their capital costs substantially. At this point I don’t see an issue with Norwegian surviving the winter.

Copyright william87 / 123RF Stock Photo

With Delta’s increased presence in Austin I expected that Paris would eventually be served by Air France (or Delta itself) not Norwegian, though not for a few years. More transatlantic capacity and non-stop destinations from Austin is a nice win for the local market, albeit a subsidized win.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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  1. I’m not sure how sustainable this is long term to have so many TATL seats: daily 744 to LHR on BA, 4x weekly on 789 on DY to LGW, 5x weekly on A333 on LH to FRA, 3x weekly on 789 to CDG on DY and 3x weekly on A330 to AMS on KL. At the very least all these seats have to be making a dent on TATL feed for AA at DFW and UA at IAH from major spokes AUS and SAT.

  2. The costs the mainline air carriers are charging for direct flights to Europe from Austin just aren’t worth it in my opinion. I still fly via IAH or ORD or DFW depending on the carrier.

    A lower cost carrier with an okay premium product will hopefully bring that down. Austin is booming with growth and so are the surrounding towns and needs these options but if I have to pay $500-$600 more for direct when I can fly a hop of 30 minutes to Houston for so much less….so far I have been opting for the connection. I have seen zero price drop so far or emptier planes from IAH etc though so demand must be keeping up.

  3. I am no economist but I think not having the 737MAX is helping Norwegian.

    First, not having the MAX means capacity they don’t have to sell now, and flight costs / maintenance that they don’t have to pay. Just look at the plane occupancy rate: it is up despite missing the MAX. Of course, the MAX is partly a replacement for aircraft with higher operational cost, but I think that Norwegian secretly won’t mind.

    And then, once all investigations have been completed, there will of course be substantial compensation from Boeing. Norwegian can use this to, for example, reduce their debt burden or they can convert it into Boeing credits where they do not have to spend money on new aircraft or aircraft features. I think Norwegian will be alright.

    I AM disappointed they did not pick CLT for a UK or Europe destination…

  4. @Gary, meanwhile down in SAT, our traffic, number of flights and non-stop destinations have been dropping. Glad that I’m on the north side of SAT and AUS is on the south side of Austin, it is only an hour drive or a $5 megabus and Capital Metro to the airport for me.

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