Admittedly, I could just do a search and look at their financial reporting, but recall reading that Norwegian as a whole wasn't profitable in its last fiscal year. Is the long haul break neck expansion profitable? What do others on this forum think about the sustainability of their strategy?

If you could just look at their annual reports to get facts versus speculation from aviation enthusiasts, why wouldn't you do that?

No, and not a chance!

Pe@rson wrote:

If you could just look at their annual reports to get facts versus speculation from aviation enthusiasts, why wouldn't you do that?

You can read every annual report from 2002 to 2016 without discovering anything about the profit/loss from the operation of Norwegian Long Haul, since those
numbers are not reported separately from the consolidated results for Norwegian Group.
The consensus seems to be that Norwegian Long Haul had its first year without loss in 2016.

kelvin933 wrote:

Pe@rson wrote:

If you could just look at their annual reports to get facts versus speculation from aviation enthusiasts, why wouldn't you do that?

You can read every annual report from 2002 to 2016 without discovering anything about the profit/loss from the operation of Norwegian Long Haul, since those
numbers are not reported separately from the consolidated results for Norwegian Group.
The consensus seems to be that Norwegian Long Haul had its first year without loss in 2016.

So let's speculate based almost solely on guesswork.

I make the point because there's no verifiable proof. Anti-Norwegian will insist no; pro-Norwegian yes. And nothing will change.

Ho hum.

Norwegian is 25% institution-owned, mostly local funds, which by itself smells of sovereign investment given that funds aren't supposed to invest in such speculative companies. DY is a very speculative company given that it doesn't have consistent result and their business plan is totally random. Norway is one of the richest countries and the airline does create high value service jobs in a country with low population and dominated by primary and secondary sector jobs, ie oil and fisheries. So it's easy to see where they get all their money for this expansion.

The airline itself is unlikely to make money with its segmented and ill-focussed strategies by an IMO lack of competent top management, which is a shame as a bit of focus could actually make it something.
However, the Norwegian government will probably be happy to support zero cost jobs instead of paying out welfare, for as long as Norwegian provides those jobs and it's cheaper than paying out welfare.

Norwegian is here to stay but major expansion will expose them to more risk and I'm not sure the guys pulling the strings behind the financing have an appetite for that. It will also create more scrutiny on the funding, create a whole new subsidies battle and Norway as a country could risk finding itself kicked out of different open skies agreements quite easily.

We'll see if their viking ego's match the ME3's foolish levels.

Here we go again...
Pro DYs vs Anti DY.
Pure biased speculation with little substance..

andymartin wrote:

No, and not a chance!

Facts?

sw733 wrote:

andymartin wrote:

No, and not a chance!

Facts?

None. That person just hates Norwegian or has nothing better to say and is just trying to make someone laugh.

The parent company Norwegian Air Shuttle made a large loss in 2014, but profits after that. In 2014, operating costs outstripped revenues.

From CAPA:
"Our calculations show that Norwegian's RASK has fallen by 15% since 2012, the last year before it entered long-haul markets. As noted previously, RASK typically falls as average trip length increases, but so too should CASK.

In Norwegian's case, however, CASK fell by only 6% from 2012 to 2014. This failure to match the fall in RASK with a similar or greater cut in CASK has plunged the company into loss."
https://centreforaviation.com/insights/analysis/norwegian-air-shuttle-2014s-heavy-losses-and-record-debt-place-the-focus-on-growth-and-costs-209759

Waterbomber wrote:

Norway is one of the richest countries and the airline does create high value service jobs in a country with low population and dominated by primary and secondary sector jobs, ie oil and fisheries.

I'm not so sure about their jobs being "high value" considering the flag of convenience games they're trying to play with their employees.

What a silly question. Only the legacies can offer "sustainable" long haul service. If it doesn't have lie-flat seats, few on these forums will be stepping aboard.

Here is what is happening today: IAG, AF/KLM Group, among others are creating subsidiaries to compete head-on, basing specially configured planes and opening/operating to same destinations (BA LGW-OAK). They are clearly having an impact. They continue to grow as more planes come on board.

Why is Norwegians "flag of convenience" under so much scrutiny when every legacy airline has regionals and subsidiaries and different employee groups with the exact same intention, lower costs/lower wages.

They are operating long haul birds with the lowest operating and maintenance costs, they have controlled labor costs (with lower costs), they are flying to destinations that have so much demand the legacies and choosing to spend millions of dollars to match them. That seems like someone is making money.

OB1504 wrote:

Waterbomber wrote:

Norway is one of the richest countries and the airline does create high value service jobs in a country with low population and dominated by primary and secondary sector jobs, ie oil and fisheries.

I'm not so sure about their jobs being "high value" considering the flag of convenience games they're trying to play with their employees.

The Norwegian employes in Norwegian are very well paid. Better paid than the Norwegians in SAS.

This doesn't answer question but :
How many people (if anyone knows) DO NOT pre order a meal on a long Norwegian flight? I am BA cabin crew and came back from LA on Norwegian a few weeks ago. It was only just cheaper than our own flight and was already bought for me. (I couldn't risk standby because I was helping two small nephews and their dad with broken legs to London) Almost everyone sitting near us received pre-ordered menu items. It made me think that it's a gimmick to say rather than *add-value* by buying the supper at a lower than on-board rate, you can simply *decrease* cost by not having it... So people, happy with the Norwegian concept, the nice new plane and new adventure just pay for the meal.... Which then made me think that maybe they're not altogether low cost and there may even be a shelf life on using "low cost" as a marketing tool word.

My point really is that I was hard pressed to really see any big difference between their 787 and ours (which I spend a lot of my time on) and all it takes is for them to remove one row of traveler plus seats (premium economy) - put in 4 lie-flats and after all BA's frantic and frankly ineffective scurrying about to "compete" we will have just further degraded our product and Mr Kjos will be chortling even louder into his beer... except that Norwegians are not a mean spirited people really. Norwegian is pulling a flanker, I am sure of it.

Waterbomber wrote:

Norwegian is 25% institution-owned, mostly local funds, which by itself smells of sovereign investment given that funds aren't supposed to invest in such speculative companies. DY is a very speculative company given that it doesn't have consistent result and their business plan is totally random. Norway is one of the richest countries and the airline does create high value service jobs in a country with low population and dominated by primary and secondary sector jobs, ie oil and fisheries. So it's easy to see where they get all their money for this expansion.


.

Bjorn Kjos owns just under 25% of the Norwegian Group, with no other shareholding greater than 6%. Hardly looks like sovereign investment to me. If funds aren't supposed to invest in speculative companies, how the hell does anybody find start-up capital for anything? What about biochemical and pharmaceuticals?

Tell Indigo Partners that their investment in JetBlue was speculative and that its flotation was a mirage.

The biggest indication would have to be at LGW. They are utilising slots previously used on short haul, and swapping them for long haul - surely an indication that its doing well at least from LGW.

airzona11 wrote:

Why is Norwegians "flag of convenience" under so much scrutiny when every legacy airline has regionals and subsidiaries and different employee groups with the exact same intention, lower costs/lower wages.

flags of convenience are union busting techniques to get around union and state labor regs. regional vs. legacy are union approved methods to defray costs of lower rasm vs casm. read sec1 of any legacy airlines pwa. and are not state dependent.

VolvoBus wrote:

Waterbomber wrote:

Norwegian is 25% institution-owned, mostly local funds, which by itself smells of sovereign investment given that funds aren't supposed to invest in such speculative companies. DY is a very speculative company given that it doesn't have consistent result and their business plan is totally random. Norway is one of the richest countries and the airline does create high value service jobs in a country with low population and dominated by primary and secondary sector jobs, ie oil and fisheries. So it's easy to see where they get all their money for this expansion.


.

Bjorn Kjos owns just under 25% of the Norwegian Group, with no other shareholding greater than 6%. Hardly looks like sovereign investment to me. If funds aren't supposed to invest in speculative companies, how the hell does anybody find start-up capital for anything? What about biochemical and pharmaceuticals?

Tell Indigo Partners that their investment in JetBlue was speculative and that its flotation was a mirage.

Well where did Mr. Bjorn Kjos suddenly find the huge fortune that launched DY to the heights that it is at now?
It's not at all clear where DY's money is coming from and when that happens, you don't need to look any further.
Starting and growing an airline requires big money and given the volatile nature of the business, you often need more than just appetite for return to make it work.

Long haul low cost is really poor economics. Many have tried and failed. It's a structural problem, not something the 787 or MOM will magically fix. The ability to spread capital costs across 6+ sectors a day is a huge differentiator amongst LCC's (southwest/Ryanair/Wizz) that can't be replicated in the long haul segment without supersonic transports.

Waterbomber wrote:

Well where did Mr. Bjorn Kjos suddenly find the huge fortune that launched DY to the heights that it is at now?
It's not at all clear where DY's money is coming from and when that happens, you don't need to look any further.
Starting and growing an airline requires big money and given the volatile nature of the business, you often need more than just appetite for return to make it work.

Before sprouting conspiracy theories read about the start of the airline, in this case Wikipedia should help you understand how a tiny Norwegian regional charter operation grew into todays Norwegian Air Shuttle. Mr Kjos did not need a huge fortune to start the airline, growing an airline is possible without huge cash injections if the airline is consistently profitable.
http://en.wikipedia.org/wiki/Norwegian_Air_Shuttle?oldformat=true

Blockplus wrote:

airzona11 wrote:

Why is Norwegians "flag of convenience" under so much scrutiny when every legacy airline has regionals and subsidiaries and different employee groups with the exact same intention, lower costs/lower wages.

flags of convenience are union busting techniques to get around union and state labor regs. regional vs. legacy are union approved methods to defray costs of lower rasm vs casm. read sec1 of any legacy airlines pwa. and are not state dependent.

Is DY state dependent ? Are you trying to tell me the regional staff are paid in line with their mainline peers? Airlines use them to lower costs.. Nothing you just said discredits DY from being a profitable and sustainable operation.

If you follow the money it leads you to companies controlled by the IKEA family.

Basefly wrote:

If you follow the money it leads you to companies controlled by the IKEA family.

Source? I've never heard this claim.

I am pleased the OP brought this topic up. When I heard yesterday about Norwegian's new services to AUS and DEN, I pondered the same question. It does make me wonder how a smaller carrier can put a fleet of brand new shiny 787's on a slew of lower yielding intercontinental routes and earn a profit. Regardless of the flag of convenience dilemma, it does make one wonder if this is sustainable over the long term.

airzona11 wrote:

Only the legacies can offer "sustainable" long haul service. If it doesn't have lie-flat seats, few on these forums will be stepping aboard.

How can you be sure of that? I wouldn't be surprised if many members of this website can't afford lie flat seats.

Jamake1 wrote:

I am pleased the OP brought this topic up. When I heard yesterday about Norwegian's new services to AUS and DEN, I pondered the same question. It does make me wonder how a smaller carrier can put a fleet of brand new shiny 787's on a slew of lower yielding intercontinental routes and earn a profit. Regardless of the flag of convenience dilemma, it does make one wonder if this is sustainable over the long term.

Yes it is sustainable as they are "growing the pie" and this is good for aviation and the Norwegian's are great business people as all you have to do is see what they have done with Viking River Cruises. Point being is that I am a regular on the Gatwick to OAK flight and it is wonderful experience and there is always a butt in every seat. All these "they cannot make it" comments make me laugh as they were the same arguments when SWA started back in 1971 and yes I was there to hear all the naysayers. Of course the then CEO of American Airlines Bob Crandall made his now famous stupid of all time comment: "This airline will not last as who is going to fly an airline with only 3 planes with no food and no assigned seating". So be careful about saying DY cannot do this as my strong opinion is they are doing it and will keep doing it and will make money at it. I fly LGA to OAK for $500 round trip so sorry BA and UAL but the news boys in town are eating your lunch.

Would be interesting to see when the Q2 results come out, but Q1 was a disaster compares to previous years. Consider how hard US airlines work to achieve profitability, it's amazing to me their investors just allow them to continue their business plan of loosing massive amount of money to gain market share.

Pe@rson wrote:

So let's speculate based almost solely on guesswork.

You're not seriously suggesting that anything else would (or in most cases, could) happen here, are you?

From the latest investor report:


Financing flexibility and availability:

* Export credit financing (Ex-Im and ECA) and Insurance syndicate (AFIC)
• EETC (Enhanced Equipment Trust Certificates), Private Placements, Commercial Banks
• Sale and leaseback (SLB) • Bonds
• Manufacturer support
• Attractive assets with a liquid secondhand market



Shareholders as of 5 May 2017


1 HBK HOLDING AS * FILIPSTAD BRYGGE OSLO NORWAY 8 795 873 24,6 %
2 FOLKETRYGDFONDET Postboks 1845 VIKA OSLO NORWAY 2 656 203 7,4 %
3 SKAGEN VEKST C/O HANDELSBANKEN NORDIC CUSTODY OSLO NORWAY 1 500 000 4,2 %
4 FERD AS PB 484 LYSAKER NORWAY 1 450 000 4,1 %
5 DANSKE INVEST NORSKE INSTIT. II. POSTBOKS 1170, SENTRUM OSLO NORWAY 943 266 2,6 %
6 SKAGEN KON-TIKI C/O HANDELSBANKEN NORDIC CUSTODY OSLO NORWAY 700 000 2,0 %
7 NOM CLEARSTREAM BANKING S.A. 42, AVENUE J.F. KENNEDY L-1855 LUXEMBOURG LUXEMBOURG 622 465 1,7 %
8 KLP AKSJENORGE Dronning Eufemias gate 10 OSLO NORWAY 552 841 1,5 %
9 VERDIPAPIRFONDET PARETO INVESTMENT Postboks 1724 Vika OSLO NORWAY 510 000 1,4 %
10 VERDIPAPIRFONDET DNB NORGE SELEKTI Dronning Eufemias gate 30 OSLO NORWAY 467 487 1,3 %
11 DANSKE INVEST NORSKE AKSJER INST POSTBOKS 1170, SENTRUM OSLO NORWAY 461 797 1,3 %
12 VERDIPAPIRFONDET DNB NORGE (IV) Dronning Eufemias gate 30 OSLO NORWAY 360 941 1,0 %
13 DNB NOR MARKETS, AKSJEHAND/ANALYSE v/ DNB Markets Equity Derivatives OSLO NORWAY 346 553 1,0 %
14 KOMMUNAL LANDSPENSJONSKASSE Dronning Eufemias gate 10 OSLO NORWAY 310 935 0,9 %
15 BROKER DANSKE BANK AS GIROSTRØGET 1 HØJE TÅSTRUP, DANMARK DANMARK 283 397 0,8 %
16 NOM DANSKE BANK A/S HOLMENS KANAL 2-12 DK-1092 KØBENHAVN K DANMARK 266 567 0,7 %
17 SWEDBANK GENERATOR BOLETTE BRYGGE 1 OSLO NORWAY 264 042 0,7 %
18 NOM NORDNET BANK AB GUSTAVSLUNDSVÄGEN 139/BOX 14077 16714 BROMMA SVERIGE 237 132 0,7 %
19 VERDIPAPIRFONDET ALFRED BERG NORGE Munkedamsveien 35 OSLO NORWAY 212 493 0,6 %
20 NOM THE BANK OF NEW YORK MELLON SA/NV 46 RUE MONTOYERSTRAAT B-1000 BRUSSEL BELGIA 210 818 0,6 %
21 DANSKE INVEST NORGE II POSTBOKS 1170, SENTRUM OSLO NORWAY 209 244 0,6 %
22 NOM SAXO BANK A/S Philip Heymans Allé 15 Hellerup DANMARK 203 472 0,6 %
23 APOLLO ASSET LIMITED Tour Odeon MC-98000 MONACO MONACO 200 000 0,6 %
24 NOM UBS AG 1 FINSBURY AVENUE LONDON, EC2M 2PP STORBRITANNIA 187 269 0,5 %
25 SKANDINAVISKA ENSKILDA BANKEN AB RA5:2/SSO - CORPORATE ACTIONS S-106 40 STOCKHOLM SVERIGE 181 143 0,5 % 26 NOM SKANDINAVISKA ENSKILDA BANKEN AB SECURITIES SERVICES S-106 40 STOCKHOLM SVERIGE 180 503 0,5 %
27 VERDIPAPIRFONDET HANDELSBANKEN RÅDHUSGATAN 27 OSLO NORWAY 170 000 0,5 %
28 ULSVÅG INVEST AS SARAV 32 ALTA NORWAY 165 000 0,5 %
29 CREDIT SUISSE SECURITIES ONE CABOT SQUARE LONDON, E14 4Q1 STORBRITANNIA 159 964 0,4 %
30 NORDNET LIVSFORSIKRING AS Postboks 302, Sentrum OSLO NORWAY 158 982 0,4 % TOP 30 22 968 387 64,2 % OTHER 12 791 252 35,8 % TOTAL 35 759 639 100,0 %


* The shareholding of HBK Holding AS reflects the actual shareholding and may deviate from the official shareholder register


HBK Holding is Bjørn Kjos's ownership

Folketrygdfondet is the Government Pension Fund of Norway

Kommunal Landspensjonskasse Gjensidig Forsikringsselskap or KLP is a mutual insurance company responsible for the management of municipal and county pensions and insurance issues

Other than that it's mostly banks, Investment funds etc


Everything you need to know:

https://www.norwegian.com/uk/about/comp ... relations/

airzona11 wrote:

Blockplus wrote:

airzona11 wrote:

Why is Norwegians "flag of convenience" under so much scrutiny when every legacy airline has regionals and subsidiaries and different employee groups with the exact same intention, lower costs/lower wages.

flags of convenience are union busting techniques to get around union and state labor regs. regional vs. legacy are union approved methods to defray costs of lower rasm vs casm. read sec1 of any legacy airlines pwa. and are not state dependent.

Is DY state dependent ? Are you trying to tell me the regional staff are paid in line with their mainline peers? Airlines use them to lower costs.. Nothing you just said discredits DY from being a profitable and sustainable operation.

dy is not state dependent as they are able to shop around to find a state that is convenient to them. all US carriers operate under the same rules. I'm not saying regionals operate under a b scale, but it was negotiated by the mainline pilots that they could operate for them at all. most mainline contract hold the holding company accountable to operate under the pwa, not just the certificate holder.

Could it be that Norwegian Long Haul is a feeder of Norwegian Air Shuttle? wouldn't be the first time a short haul needs a long haul arm to bring pax, or viceversa.

Jamake1 wrote:

I am pleased the OP brought this topic up. When I heard yesterday about Norwegian's new services to AUS and DEN, I pondered the same question. It does make me wonder how a smaller carrier can put a fleet of brand new shiny 787's on a slew of lower yielding intercontinental routes and earn a profit. Regardless of the flag of convenience dilemma, it does make one wonder if this is sustainable over the long term.

???? Do you know how easy it is to borrow money to buy airplanes?? Interest rates are low and good borrowers get better rates.

I love this, it's a great example of how lost some people are on this site. I don't know a single person who isn't somehow involved in aviation that knows anything whatsoever with regards to service levels and seating configurations. If you truly be,ieve people won't continue to flock to DY in droves. Cause they don't have lieflats or aren't "full service" (because that totally still means something nowadays, you would be damn hard pressed to discern a difference in comparable cabins between Norwegian and just about anyone else...because most people don't actually care). Money talks, and Norwegian has responded. Flying is less and less of a luxury, people take it for granted nowadays, and it's becoming a simple people mover service. Norwegian gets this and caters to overwhelming majority of people who simply want to go on vacation/visit friends or family/attend their business meeting and be done with it. The flight is not a meaningful part of the trip to most, which is an attitude lost to many on this forum. I say, go Norwegian, keep revolutionizing the market, and keep making flying accessible.

whywhyzee wrote:

Flying is less and less of a luxury, people take it for granted nowadays, and it's becoming a simple people mover service.

THIS!

Here's my contribution.

Airlines such as TUI and Thomas Cook (arguably Condor too) can do profitable low cost longhaul. All TCX flights are basically lowcost with some having a Premium Economy cabin. The reason those work is because they can feed them with mixed traffic.

TCX and TUI are both airlines attached to major holiday companies. Their operations are principally leisure oriented, and the holiday divisions buy seats on the longhaul lowcost flights. TCX has another trick up its sleeve in that it has JetBlue at certain US ports so their offering for onward travel is viable.

So they get their lowcost longhaul to work by mixing revenue streams. TCX for instance will sell you a ticket to Boston with a hotel and transfers, a ticket with onwards Jetblue flights, or just a ticket. That's three distinct passenger groups plus their premium cabin is extremely good value. TUI isn't much different with their services to Florida and all round the Caribbean.

Unless Norwegian has internal problems or bad management, all systems indicate they are here to stay and will be expanding. They hit the nail on the head with what customers want. The LCC long haul market is still under-served, we will see them grow more and more the legacies either adjust or will shrink. As united has said their customers say one thing, but book another way. Norwegian is doing it right

airzona11 wrote:

What a silly question. Only the legacies can offer "sustainable" long haul service. If it doesn't have lie-flat seats, few on these forums will be stepping aboard.

Here is what is happening today: IAG, AF/KLM Group, among others are creating subsidiaries to compete head-on, basing specially configured planes and opening/operating to same destinations (BA LGW-OAK). They are clearly having an impact. They continue to grow as more planes come on board.

Why is Norwegians "flag of convenience" under so much scrutiny when every legacy airline has regionals and subsidiaries and different employee groups with the exact same intention, lower costs/lower wages.

They are operating long haul birds with the lowest operating and maintenance costs, they have controlled labor costs (with lower costs), they are flying to destinations that have so much demand the legacies and choosing to spend millions of dollars to match them. That seems like someone is making money.

Bullshit!

If it does have lie-flat seats that's an indication it's far too expensive and therefor I won't step on board. Norwegian is offering exactly the right product, they get you from one place to another for not a penny too much. That's what people are looking for these days.

JumboMaiden wrote:

This doesn't answer question but :
How many people (if anyone knows) DO NOT pre order a meal on a long Norwegian flight? I am BA cabin crew and came back from LA on Norwegian a few weeks ago. It was only just cheaper than our own flight and was already bought for me. (I couldn't risk standby because I was helping two small nephews and their dad with broken legs to London) Almost everyone sitting near us received pre-ordered menu items. It made me think that it's a gimmick to say rather than *add-value* by buying the supper at a lower than on-board rate, you can simply *decrease* cost by not having it... So people, happy with the Norwegian concept, the nice new plane and new adventure just pay for the meal.... Which then made me think that maybe they're not altogether low cost and there may even be a shelf life on using "low cost" as a marketing tool word.

That's an important difference with the legacies. At an LCC you can opt not to have it, at a legacy you can't. It's included in the (higher) ticket price. When I flew Norwegian long haul to Bangkok a couple of years ago I didn't opt for any of these additional extras. I had a meal at the airport before departure and a home-made sandwich on board. The only thing I bought on board was a drink. Also I didn't have any checked luggage, only hand luggage. I think that's where the strength of the LCC business model lies.

Is it profitable? I'd say it is, otherwise they wouldn't be doing it.

I am in no way against Norwegian and I do applaud them for their innovative approach to making long-haul low-cost work (seemingly). However, to me, their business model and exorbitant rate of long-haul growth feels like a bubble. While I'm admittedly lacking facts to support this, I'll just call it a 'gut feeling.' It just doesn't seem sustainable.

There is nothing innovative about Norwegian. A large airplane filled with economy seats that charges for everything.

It may appear as Norwegian is in a bubble but the management and staff just seem too confident for me to believe that. I was at the first flight of Norwegian from SWF to EDI and they seemed very confident in what they are doing with starting flights to secondary markets. There really must be something else to the company that we obviously don't know that will give them true victory in the next couple of years. Only then will we really know their true way of making a profit.

PatrickZ80 wrote:

airzona11 wrote:

What a silly question. Only the legacies can offer "sustainable" long haul service. If it doesn't have lie-flat seats, few on these forums will be stepping aboard.

Here is what is happening today: IAG, AF/KLM Group, among others are creating subsidiaries to compete head-on, basing specially configured planes and opening/operating to same destinations (BA LGW-OAK). They are clearly having an impact. They continue to grow as more planes come on board.

Why is Norwegians "flag of convenience" under so much scrutiny when every legacy airline has regionals and subsidiaries and different employee groups with the exact same intention, lower costs/lower wages.

They are operating long haul birds with the lowest operating and maintenance costs, they have controlled labor costs (with lower costs), they are flying to destinations that have so much demand the legacies and choosing to spend millions of dollars to match them. That seems like someone is making money.

Bullshit!

If it does have lie-flat seats that's an indication it's far too expensive and therefor I won't step on board. Norwegian is offering exactly the right product, they get you from one place to another for not a penny too much. That's what people are looking for these days.

JumboMaiden wrote:

This doesn't answer question but :
How many people (if anyone knows) DO NOT pre order a meal on a long Norwegian flight? I am BA cabin crew and came back from LA on Norwegian a few weeks ago. It was only just cheaper than our own flight and was already bought for me. (I couldn't risk standby because I was helping two small nephews and their dad with broken legs to London) Almost everyone sitting near us received pre-ordered menu items. It made me think that it's a gimmick to say rather than *add-value* by buying the supper at a lower than on-board rate, you can simply *decrease* cost by not having it... So people, happy with the Norwegian concept, the nice new plane and new adventure just pay for the meal.... Which then made me think that maybe they're not altogether low cost and there may even be a shelf life on using "low cost" as a marketing tool word.

That's an important difference with the legacies. At an LCC you can opt not to have it, at a legacy you can't. It's included in the (higher) ticket price. When I flew Norwegian long haul to Bangkok a couple of years ago I didn't opt for any of these additional extras. I had a meal at the airport before departure and a home-made sandwich on board. The only thing I bought on board was a drink. Also I didn't have any checked luggage, only hand luggage. I think that's where the strength of the LCC business model lies.

Is it profitable? I'd say it is, otherwise they wouldn't be doing it.

They had small profit in 2016 when every airlines make boat load of money and had a huge loss in first quarter, much larger than 2016 q1. The aviation environment has certainly gotten tougher this year and they are opening new routes. Cause they believe you can expand into profitability somehow. We will see, but this bubble will pop if aviation ever takes a bigger downturn. They are lucky they are not listed in America, because wall street would have been all over them.

Norwegian has a huge debt leverage. Its balance sheets are very different from many legacies who have quite little debt, though leased planes are quite like debt. Norwegian thus has very little buffer if things go wrong, i.e. it cannot take much losses any more. That does not necessarily mean that it will be immediately belly up, but a bad quarter may just lead to a rapid debtor take-over after which things go on as before, unless the debtors prefer to take hardware. In no case is it comparable to AB or AZ, as the operations are mostly healthy, as far as I know, despite some problems with stranded passengers.

Curiously Norwegian has chosen to expand only in the US/Canada -EU market because the fares on other major markets are low enough that even an LCC will not be able to complete, especially when the full service airlines are offering free meals, generous baggage allowance. And the US and European legacies also match these low fares too and sometimes are the price leaders.

Norwegian is needed in this transatlantic market where the legacies are charging the customers with very high fares. As Norwegian expands, look for the legacies to start lowering the prices and the customers will benefit.

AtomicGarden wrote:

Could it be that Norwegian Long Haul is a feeder of Norwegian Air Shuttle? wouldn't be the first time a short haul needs a long haul arm to bring pax, or viceversa.

A rather obvious and pointless statement to be honest!

Basefly wrote:

If you follow the money it leads you to companies controlled by the IKEA family.

Why would a Swedish company such as IKEA be so involved with Norwegian?

Cunard wrote:

AtomicGarden wrote:

Could it be that Norwegian Long Haul is a feeder of Norwegian Air Shuttle? wouldn't be the first time a short haul needs a long haul arm to bring pax, or viceversa.

A rather obvious and pointless statement to be honest!

If that was the case the operating times for DY's longhaul flights wouldn't arrive so late in the likes of OSL,ARN and CPH when there are quite a few amount of flights. If that was their main goal their flights should arrive at 5:00am over 11:00am.

hohd wrote:

Curiously Norwegian has chosen to expand only in the US/Canada -EU market because the fares on other major markets are low enough that even an LCC will not be able to complete, especially when the full service airlines are offering free meals, generous baggage allowance. And the US and European legacies also match these low fares too and sometimes are the price leaders.

Norwegian isn't just going head-to-head with the big boys, it's creating markets. For example, Edinburgh to Bradley and T F Green or Belfast to Stewart are routes operated by nobody else.

Cunard wrote:

AtomicGarden wrote:

Could it be that Norwegian Long Haul is a feeder of Norwegian Air Shuttle? wouldn't be the first time a short haul needs a long haul arm to bring pax, or viceversa.

A rather obvious and pointless statement to be honest!

So, you agree with me then! NLH is not a money losing business.

slcdeltarumd11 wrote:

Unless Norwegian has internal problems or bad management, all systems indicate they are here to stay and will be expanding. They hit the nail on the head with what customers want. The LCC long haul market is still under-served, we will see them grow more and more the legacies either adjust or will shrink. As united has said their customers say one thing, but book another way. Norwegian is doing it right

Or they ll run everyone out of business and then jack up the prices, like Ryanair and the ME3 are doing.

Let's remove the technical advantage of the 787 vs older generation aircraft from the equation and ask ourselves this... would norwegian as 'successful' with standard aircraft like te a330, 772, or a 763?

At some point down the line, the 787's advantage over some of their competitors will be muted as OALs catch up technology wise.