Transport

Cantillon: Norwegian Air close to landing US deal

It has taken Washington two years to ‘tentatively’ agree to grant the permit

Chief executive of Norwegian Air Shuttle Bjorn Kjos: The Scandinavian group chose to base Norwegian Air in the Republic as that would allow it to benefit from the EU’s open skies treaty with the US.

Tue Apr 19 2016 - 01:17

An Irish airline with a Scandinavian name flying from Cork to Boston? It’s easy to see why some might be confused, if not a little suspicious. However, there’s some likelihood that this is going to happen.

The US department of transportation is "tentatively" proposing to give Norwegian Air International a foreign carrier's permit allowing it to operate flights between there and the EU.

Norwegian Air International is an Irish-registered and licensed airline that is a subsidiary of Norwegian Air Shuttle, which established it in 2013. The Scandinavian group chose to base the carrier in the Republic as that would allow it to benefit from the EU’s open skies treaty with the US.

As Norway is not in the EU, Norwegian needs this to go forward with its plans to offer low-cost transatlantic flights. In 2014, the group's chief executive, Bjorn Kjos (pictured), said that it chose the Republic as the base for its international subsidiary because it has a high standard of safety regulation and because the State is a hub for aircraft finance.

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The problem is that it has taken Washington two years to “tentatively” agree to grant the permit. This is because powerful US aviation unions say the airline intends using the Republic as a flag of convenience to employ low-paid crew, undermining working conditions for those working for all other transatlantic airlines.

Kjos and Norwegian dismissed this, saying the airline employs staff under Irish law. It has also told the US department and the Irish Aviation Authority that only EU and US citizens would crew the flights. This has not quelled union fears. Edward Wytkind of the transportation trades department of the AFL-CIO, the US federation of labour organisations, made it clear they oppose the decision. Interested parties have 21 days to make submissions on the proposal and a final decision will follow a week later. While it may have had a breakthrough, it would be unwise to assume that Norwegian Air International has this over the line just yet.

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