Norwegian Drops All Transatlantic Flights, Liquidates Long Haul Subsidiaries

Norwegian Air was exceptionally weak before the pandemic, but their financial maneuverings had positioned them so that a strong summer in 2020 would give them runway to make it through the lean winter. Covid precluded that strong summer. Last year on March 6 I identified Norwegian’s failure as a coronavirus risk. Now they’ve announced the end of long haul flying.

In October Norway’s government discussed and then declined to nationalize the airline. In November they declared bankruptcy, looking to restructure. Earlier they had declared four subsidiaries bankrupt.

The airline has now told employees of its long haul subsidiary in the U.S. and elsewhere that their jobs are terminated effective Friday, January 15.

January 14th, 2021

Dear colleagues,

It is with with great sadness that I am writing to inform you that we have made the difficult decision that the long haul operation will not continue in all our markets going forward. Our newly announced business plan has outlined a more simplified business structure that focuses on a dedicated short haul route network.

The COVID-19 pandemic has profoundly affected the entire aviation industry. Travel restrictions and changing government advice continue to negatively influence demand for long haul travel and our entire Boeing 787 Dreamliner fleet has been grounded since March 2020. Future demand for long haul travel remains very uncertain.

We have sought every opportunity to safeguard as many jobs as possible and maintain a viable business. The financial situation that we find ourselves in has resulted in an examinership process in Ireland and a reconstruction process in Norway at the end of 2020. To exit these processes and safeguard the future of our company our only viable option is to focus on our short haul network.

This means that Norwegian Air Resources UK Limited (the Company), as well as the two related group affiliates operating in the US, France and Italy will now probably cease to trade. The board of directors has contacted insolvency practitioners at KPMG in the UK. The objective is to place the Company into Creditors’ Voluntary Liquidation as quickly as possible. KPMG’s key function will be to assist employees make claims to the Government Redundancy Payment Office for arrears of pay and redundancy (where available). KPMG will also co-ordinate between the employees, Unite, BALPA and the Company regarding training records.

Although the liquidation process has started, the legal formalities will take some time to complete. It is expected that KPMG will be appointed for this process before the end of January. In the meantime, we will sadly have to initiate a collective redundancy process.

We fully understand that this news will create both personal stress and challenges during this difficult time and would personally want to thank each one of you for your tireless dedication and contribution to Norwegian over the years.

Our operations reached many milestones since we launched, and prior to this crisis we were the benchmark for low cost travel across the world which is a testament to your hard work and professionalism.

A further update and FAQ document in relation to the redundancy and termination claims will be provided to all employees before the close of business on Friday January 15th, 2020.

Thank you,
________________
Guro H. Poulsen
EVP People


Copyright william87 / 123RF Stock Photo

Norwegian helped drive low cost transatlantic travel with its Boeing 787s, much to the chagrin of legacy carriers. British Airways even considered buying the airline in order to quash it as a competitor. Now it will focus on domestic and regional flying with its narrowbody aircraft.

None of this is surprising but it’s disappointing for consumers who benefited from the competition, whether they flew Norwegian or not.

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 InsideFlyer.com, 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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Comments

  1. Very disappointing as they were the only carrier in the U.K. that priced transatlantic tickets as one-way fares. They will be missed.

  2. Sorry to hear this — I took advantage of their low prices when they began flying out of Denver…I got a Denver to Copenhagen and Copenhagen to Dublin trip for about $500 or so. The airplane was brand new, service was good. I would have used them again, but I guess that’s a thing of the past….

  3. What most people won’t be aware of… Norwegian’s exit from the longhaul market may surprisingly pose a particular headache for British Airways.

    It removes another competitor to the existing BA / American Airlines transatlantic joint venture. This is not good news as it will mean greater scrutiny in 2024 when the Competition and Markets Authority revisits the existing agreement.

    Luckily for BA, JetBlue has plans to enter the transatlantic market later this year.

  4. Am I glad I threatened DOT and EU261 complaints to finally drag refunds out of them rather than accept a percentage bonus taking refunds in points for numerous canceled flights.

    Too bad though their premium economy was an excellent value for Westbound travel from Europe to USA when I did not need a lie flat seat to sleep. Product was like US airlines in Domestic First Class but better (wider) seats.

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