Norwegian Air Shuttle deepened planned cuts in its long-haul network that are aimed at returning the troubled low-cost carrier to profitability this year.
The Oslo-based airline is fast reversing a strategy of growth at all costs that increased debt to untenable levels, and will now focus its long-haul routes on London, Rome, Paris, Barcelona and the United States, it said Thursday.
Norwegian had already reversed the course set by co-founder Bjorn Kjos, who stepped down last July – selling assets, trimming routes, delaying aircraft deliveries, changing loan terms and raising fresh cash. The moves have shown results with increased efficiency in recent months.
Norwegian now plans to reduce capacity, measured in available seat kilometres, by 13 per cent to 15 per cent this year compared with an earlier target of 10 per cent, it said in reporting fourth-quarter results.
Shuttered
The loss before interest and taxes was slightly narrower than analysts expected at 1.28 billion kroner (€130 million). That compares with a 3.59 billion-kroner loss in the year-ago period.
The company has shuttered more than 50 short-haul routes, mainly outside its core Nordic area, and more than 20 long-haul routes, it said in presentation material.
The carrier is optimising the network and securing leasing capacity to offset the impact of the continued grounding of Boeing's 737 Max. It is still in discussions with Boeing about compensation.
Norwegian expects issues with Rolls-Royce Holdings Plc engines on the Boeing 787 Dreamliner to continue in 2020.
– Bloomberg