Norwegian Air CEO: 2017 was ‘a mess’ after plane, pilot shortages
Norwegian Air Shuttle is due to disclose its annual results for 2017 on February 15, 2018, and the airline’s CEO Bjorn Kjos is already calling the year “a mess” for the airline after plane and pilot shortages disrupted the carrier’s operations in the summer of 2017.
On February 13, 2018, just two days before annual results are to be disclosed, Kjos told Bloomberg that 2017 was “a mess” for the company and that he is glad the year is over. “2017 was not a good year,” he said.
Norwegian Air faced major disruptions in 2017, including pilot shortage during the busy summer period. The airline had to cancel flights in June due to understaffing, leaving thousands of passengers stranded or forced to cancel their travel plans. According to Norway Today, the company had to lease both aircraft and personnel to bridge gaps in departures.
Norwegian was also forced to ground more than 10 Boeing 737 Max jets due to engine issues, delaying operations by six weeks and leaving crews without the flying hours required to cross the Atlantic, costing the airline $130 million, including moving staff and leasing additional planes.
The airline is estimated to have suffered a loss of NOK1.43 billion ($180 million) in 2017, in comparison to the NOK1.24 billion ($156 million) profit in 2016, according to Bloomberg.
Despite the losses, the carrier is undergoing major expansions of its long-haul flight network adding routes to South America and Asia. The airline will run a service pitched somewhere between the low-cost European model and traditional transatlantic carriers, according to The Guardian.
Norwegian is setting up a subsidiary in Argentina, where the airline is licensed to fly up to 152 routes in South America, however the massive expansion raised some skepticism by airline critics.
Aviation analyst John Strickland told BBC that “They just haven't delivered the margins of profitability you'd want to see, especially when compared with British Airways or Ryanair,” noting that the airline will have to prove that it is capable of facing economic downturn or reduced passenger numbers.
The budget transatlantic flight model is becoming more popular among LCCs with WOW and Primera airlines also planning to start cheap long haul flights across the Atlantic Ocean, according to The Economist.