Norwegian flying HIGH – airline’s global expansion to include NEW long–haul budget routes
NORWEGIAN is planning another huge expansion after passenger increase in 2017, but its fast growth is causing concern with investors.
Norwegian Air: The airline is expanding following a year of passenger growth
Norwegian has reported an 11 per cent increase in passengers last month, as the budget airline continues to grow.
Chief Executive Bjorn Kjos is hoping to expand even further due to this year's success.
“We are pleased that more passengers are choosing to fly with Norwegian. The demand is stable and the growth is highest on our intercontinental routes.
“Global expansion is important to position ourselves in a market with such strong competition, but also for creating economic value in the markets we operate.”
Norwegian Air: The airline reported an 11 per cent increase in passengers this year
The airline launched the world’s longest long-haul budget flight earlier this year
The airline launched the world’s longest long-haul budget flight earlier this year from London to Singapore.
Asia could be the next place they choose to expand to for more low-cost flights.
They already offer many flights to the US, having succeeded in the US market for cheaper flight options.
Norwegian introduced 32 new aircraft in 2017 alone, taking it to nearly 150 planes and by 2019, it is set to have nearly 200 aircraft.
Norwegian Air: The budget airline launched the first low-cost long haul flight to Singapore
In 2012, the airline had just 68 aircraft. It’s rapid expansion, has caused concern among analysts in the industry.
Andrew Lobbenberg, an aviation analyst at HSBC told the Financial Times: “They are not profitable this year in what is a very good year for the airline industry.
“The underlying business is losing considerable sums of money. This is not sustainable, something has to change.”
Shares have dropped 40 per cent this year, compared to other budget airlines which have increased, such as EasyJet (44 per cent) and Ryanair (19 per cent).
Norwegian Air: Bjorn Kjos hopes to add more aircraft to the fleet
Norwegian Air introduce their new 787 Dreamliner
Norwegian Air: The airline has successful broached the US market
The airline will need to be careful not to follow in the path of Monarch Airlines, who went bust earlier this year.
Over 80,000 passengers were affected after the airline went under, who were flown back to the UK by the Civil Aviation Authority (CAA) at a cost of £60 million.
Monarch cited terrorism as a large part of the problem after flights to Turkey and Egypt were affected.
The once popular holiday destinations suffered after a number of attacks in the countries left Britons heading to alternative destinations instead.