Norse Atlantic: New Norwegian Long Haul Airline

Filed Under: Other Airlines

A couple of weeks ago I first wrote about Norse Atlantic Airways, a new Norwegian low cost long haul airline startup (sounds like a familiar concept, eh?). Well, are now a couple of updates regarding Norse Atlantic Airways — the airline has officially reached an agreement to lease nine Boeing 787s, but will they be allowed to fly to the US?

Let’s cover the basics about the airline, and then we’ll talk about the latest updates.

Norse Atlantic Airways basics

Norse Atlantic Airways is a newly announced airline startup, and it sounds like the founders are pretty serious:

  • The airline has been founded by Bjorn Kljos, Bjørn Kise, and Bjørn Tore Larsen (that’s a lot of Bjorns/Bjørns — reminds me of the Saudia flight where I had captain Mohammed, first officer Mohammed, and cabin supervisor Mohammed), who own 90% of the airline combined; they’re industry veterans who previously held top positions at Norwegian Air Shuttle and OSM Aviation
  • The airline plans to use Boeing 787s to operate transatlantic routes
  • In Europe the airline will operate out of cities like London, Oslo, and Paris, and in the US the airline will operate out of cities like Los Angeles, Miami, and New York
  • The airline hopes to launch operations by December 2021 (December is a fantastic time to launch transatlantic leisure flights, eh?) 😉
  • The airline would like to collaborate with airlines like Norwegian to provide feed
  • The airline has already raised $24 million from shareholders, and eventually wants to be listed on the Oslo Stock Exchange

Norse Atlantic Airways would fly former Norwegian 787s

Norse Atlantic Airways secures Boeing 787 leases

Today it has been announced that AerCap and Norse Atlantic Airways have signed a lease agreement for nine Boeing 787s, with deliveries scheduled to begin in 2021. The planned lease includes six Boeing 787-9s and three Boeing 787-8s.

As Bjørn Tore Larsen, CEO of Norse Atlantic Airways, describes this deal:

“We are thrilled to be partnering with a market leader in AerCap to lease our initial fleet of Dreamliners. Norse Atlantic Airways looks forward to providing our passengers with comfortable, affordable, intercontinental travel aboard these state-of-the-art aircraft.”

I would imagine that these 787s will simply maintain the same interiors that they previously had with Norwegian, given that it’s the most cost efficient option. I’d say that’s good for consumers.

Norwegian’s 787s had a solid premium economy product, with recliner seats in 2-3-2 configuration. Norwegian premium economy was certainly a good value.

Norwegian 787 premium economy

Meanwhile Norwegian’s economy was in a 3-3-3 configuration. While not the most spacious out there, the personal entertainment, mood lighting, power ports, and internet, were ultimately a solid offering for an ultra low cost carrier (I’m curious to see if Norse Atlantic plans to offer Wi-Fi).


Norwegian 787 economy

Could the US block Norse Atlantic Airways flights?

In order to fly to the United States, Norse Atlantic Airways will need to gain approval from the US Department of Transportation, as is the case with all airlines looking to serve the US.

Last week the Chairman of the House Transportation and Infrastructure Committee, Peter DeFazio, urged Transportation Secretary Pete Buttigieg to block Norse Atlantic Airways from flying to the United States:

“At the end of 2016, the outgoing administration imprudently issued a foreign air carrier permit to Norwegian Air International — an airline that was ‘Norwegian’ in name only and established itself in Ireland under a flag of convenience to avoid Norway’s strong labor protections. Norwegian is bankrupt, and its U.S. services have ceased, but its founder is forming a new carrier that will likely seek a permit—Norse Atlantic—and it is imperative that you correct the error of 2016 and deny this airline’s application.”

There’s no denying that Norwegian took advantage of every tax & labor opportunity available to it, but at the same time should that be grounds for blocking the airline from flying to the US? Because if so, I have a few other airlines I’d like to bring to DeFazio’s attention.

Also, it’s not like US airlines don’t take advantage of every opportunity they have — just look at how Delta has avoided tariffs on Airbus planes, or how many tens of billions of dollars worth of aid US airlines have received, which Norwegian hasn’t.

To be clear, I don’t have issues with any of these individually, I just think there’s some cherry-picking going on here.

Could Norse Atlantic Airways be blocked from flying to the US?

Why low cost, long haul airlines don’t work

At the beginning of 2021 it was announced that Norwegian would discontinue long haul flights, as the airline is in bankruptcy protection. Norwegian was struggling for years even pre-pandemic, and has basically already had its nine lives.

The intentions for Norse Atlantic Airways are pretty clear — some investors (including a former Norwegian executive) with a clean balance sheet are trying to take over where Norwegian left off when it comes to long haul. There’s only one small problem — history has shown that low cost long haul airlines generally don’t work.

Now, to give some credit to this idea in general, or to perhaps express some hope:

  • Having an airline like Norse Atlantic Airways would be great for consumers, since it will keep legacy airlines in check, and will keep fares low
  • The general timeline for launching this airline isn’t terrible, especially if the plan is to launch in about a year; the airline probably got a great deal on planes, and can get a great deal on labor, and hopefully within a year there will be a significant recovery, with several competitors having gone out of business or scaled back during the pandemic
  • The biggest issue with a transatlantic low cost carrier is how seasonal traffic is, as Norwegian could make money in summer, but was losing a significant amount the rest of the year; is there any way that Norse Atlantic Airways could learn from Norwegian’s mistakes and do a better job with a counter seasonal route network (though that concept has its own challenges)?

This is going to be an interesting one to watch. While the airline has now secured leases for planes, it otherwise has an uphill battle, between general profitability and regulatory concerns.

Norwegian 2.0 will be entering the transatlantic market

Bottom line

Norse Atlantic Airways is the newest airline startup. The airline essentially plans to take over where Norwegian left off with its long haul network — the airline will fly former Norwegian 787s across the Atlantic using a low cost business model.

Only time will tell if this airline actually takes off, between the general challenges associated with this business model, and concerns from US regulators. My favorite Richard Branson quote comes to mind with this — “the quickest way to become a millionaire in the airline business is to start out as a billionaire.”

What do you make of Norse Atlantic Airways?

Comments
  1. Solution to the seasonality problem:
    1. From May to September, fly exclusively east/west, between Europe and North America
    2. From October to April, fly exclusively north/south, between northern Europe and warm vacation destinations (southern Europe, Mediterranean, North Africa)
    3. Stay focused. Stop trying to chase every possible destination/route.

  2. Norwegian model would’ve been successful had they squeezed by a little longer it was the 787 issues and covid that interrupted their plans and since operating on a cliff budget, went bust. more time and i am confident they would’ve raised prices a bit (still less then legacy ) and be profitable jut like NK

  3. The photo “Norse Atlantic Airways would fly former Norwegian 787s” wow just realized how big those engines are. They are either GEnx-2B (104.7” diameter) or GEnx-1B (111.1″ diameter)
    and these are only 2/3rd diameters of the B777x GE9x is 156″ diameter. Amazing what force those blades on the front endure, not to fly out.

  4. I don’t know why such an airline could not focus on taking Europeans to long-haul sun destinations during winter and the transatlantic market during the summer.

  5. This sounds like it has some great potential!!!

    Maybe it should wait till march to start operations though??

  6. It isn’t actually as stupid as you make it sound. Some of Norwegian’s routes were profitable, so it makes sense to take what was good, in a slimmer company without so much of the bulk that there was before. A smaller airline of 12 787s seems sensible.

  7. I strongly suspect the answer will be along the lines of “that’s cute” or “hahahahaha NO” but I’ll ask anyway: will loyal customers of Norwegian have their status transferred and/or recognized if they continue to fly with Norse?

  8. @ JDubsFL — Hah, I wouldn’t rule out some sort of a status match, or something, but I wouldn’t expect anything else to transfer, since this is a completely separate company.

  9. Norwegian had a good model but over expanded and did so too quickly. Before they got too ambitious, they were successful and definitely lead to lower transatlantic pricing across the board, so we should all be rooting for them. They ran into a TON of bad luck with the 787 engine issues, MAX, and COVID. None of those are their fault.

  10. @ Ryan — I think that’s a good plan in general, but there are still a couple of challenges associated with that:
    — There are costs and challenges associated with seasonal operations rather than year-round operations (hiring and staffing at outstations, brand awareness, having to spend more on marketing, etc.)
    — There’s only so much demand for long haul travel in winter, given that schools typically aren’t out, so a lot of travel is consolidated around Christmas/New Years

  11. As an employee of the long haul Norwegian operation with their 787’s, I can say it was the best airline I have ever worked ! ….
    It was just a big shame we encountered many troubles like the 787’s engines and the 737 max ( a total failure)
    overall I do believe Norse can take over a great part of the market from the deceased Norwegian.
    Shame that the pilots and crew had their monies stolen at the end of it … with no redundancies etc etc ….

  12. Clearly americans goes will norwegian match customers status like loyalty program? who cares it is low cost it doesnt exist for both… so it is not an issue 🙂

  13. If they are anywhere CLOSE to Norwegian’s cost and service on long-haul flights…count me in. I’m STILL saving to pay the difference between my cancelled Norwegian flight (from LAX to LON) on one of the legacy carriers! I’m rooting for them!

  14. I agree with other commenters that they could have more success if they switched to warm destinations over winter like CPT, DXB, CUN, DPS, BKK and MCO, but they would need to be a very nimble airline to switch around every six months like this.

  15. @Endre

    Those are actually Rolls-Royce Trent 1000s, based on the shape and pattern of the spiral on the spinner.

  16. Great video on YouTube by Wendover Productions on this: https://youtu.be/fTyUE162lrw. Seems like Norwegian hasn’t learned their lessons. Long haul low cost airlines just don’t work with routes that are already in demand and have other airlines serving them. They should try to follow TUI’s model instead and serve new leisure destinations from a variety of hubs and create their own demand instead.

  17. For condor it works and they have seasonal flights. The slots at JFK may be an issue for seasonality, what would you say?

  18. I can see this being another massive failure. Simply put Norwegian distrusted the market and the legacy carriers reacted offering the same fare structure but more frequencies. With JetBlue entering the European market with much more cost effective A321XLR’s, I struggle to see how and where Norse would compete. When Norwegian did operate to ‘winter sun’ destinations such as BUE,SIN,BKK,HKT,KBV they were usually more expensive than full service carriers and if you take the HKT,KBV examples, they were significantly more expensive than full service carriers who operated multiple daily connections. Even if Norse were able to find Niche routes the profit margins would be razor thin and a competitor would simply capacity dump and drive them out of the market.

  19. I wish them luck, but will not book with them.

    As for Norwegian Reward, which has been gutted by the way, it had no tiers. Either you are a member, or you are not.

  20. @AirlineInsider91 – I wonder why they were more expensive than full service on Thailand routes? Surely they had lower operating costs.

    I think DPS would work well for them over winter – its a very popular destination for Europeans and I don’t believe there are any direct flights from Europe.

  21. @John T, the issue laid with there algorithm for connecting flights from the UK and other parts of Europe. As an example an EK T class fare to HKT would be £390-£430ish but a D8/DI sale fare via CPH/OSL would be £495-£525, this was due to Norwegian not releasing lower fare buckets despite demand being low (28 passengers from the UK departed on DI/D8 to HKT in 2019). DPS would be an option for Norse but if they are taking over planes from Norwegian they aren’t to great at high temperatures, I believe they had to limit capacity/timings at Las Vegas due to this! Added to that DPS is a low yield market which Garuda have and will start again operating again. Norse as someone else mentioned could follow a TUI-esque business model, CPT,PQC,KOS,PUS &DRW could be good options the latter being just in range of the 787 and would be targeted to students/one way fares into Auz at £200ish O/W or £400ish RT, now that would fill seats in winter!

  22. Do we really think international travel will be back up to pre-covid levels by December? Except for London to Dubai pre-red listing and US to Mexico this seems like a not so great idea. But keep us posted, Lucky. Interesting to follow what the company does.

  23. If the Trent 1000 issues continue for Norse amd Norse demands compensation, I hope they sue RR, the one that really deserves blame, unlike Norwegian, who blamed Boeing for RR’s screwups.

  24. This will be another complete failure. The only people that even fly this type of airlines is that 1 in 3 years Looking-for- the cheapest-trip vacation. Norwegian screwed over their previous aircrews. Any pilot or FA trying to work for this company should get their heads examined. They had an illegal operation before with how they staffed their airlines (Flag of Convenience). They’ll have to hire the correct way. As soon as wages need to rise from their lowball hiring rates, they’ll go bust. A shame people will fall for this all over again.

  25. The issue with the RR Trent’s are pretty much solved. Due to Covid they aren’t making new engines so they were able to concentrate on the “broken/flawed” ones. With the entire Norwegian 787 fleet grounded repairs have been completed. The downtime also allowed RR to restock spare engines and parts. I too see a little deja vu in this plan but these 787s at fire sale prices shouldn’t be a problem.

  26. The reason DeFazio wrote requesting denial is one simple fact UNION. DeFazio is heavily backed by the unions and this President has publicly stated he will be the most union favorable President ever. Translated cost of goods/services will go up and up due to the unions.

  27. Lucky, those “naughty airline tidbits” aren’t really an easy comparison.

    1) Delta could (and likely does) make the case that the planes they cheekily flew around Trump’s sanctions were ordered or even partially purchased before the tariffs came into effect, and their exploiting a perfectly valid loophole (flying through a neutral country before delivery to the US) was merely a reaction to Trump’s witless refusal to grandfather in the planes bought prior to his little tantrum. Norwegian is just evading taxes by locating in Ireland. They pretty much admit it, as does the very willing Irish government.

    2) Of course Norwegian or Norse Atlantic did not receive CARES Act funding. They’re not based in the United States. We also didn’t send aid to Alitalia, in case you were wondering.

  28. Can Norsk Air learn from Norweigian’s mistakes? Yes, but only by not starting service in the first place. Any way you slice it the business model is broken.

  29. Interesting to read the comments here from numerous informed Industry Insiders. But few talk about the Consumer perceptions of LHLCCs. The strange paradox being that, even though the economy pricing of Norwegian was never actually that cheap after all the add-ons, people filled their trans-atlantic routes seemingly willing to think they were. Meantime perhaps somehow Premium fares attracted more economy upgraders than hard-nosed Legacy Loyalty flyers. Can Norse make a go of this? Not without maximising London Gatwick. Maybe the good news is that the equipment and the slots have just come along at low cost short term prices. But there is indeed a market for those who like to delude themselves that they are getting a bargain, just to sit on a brand new plane with a Crew that still gets the concept of Service.

  30. It’s unfair to say low cost long haul CANNOT work as we have one example of a LOCO that’s done pretty well with it’s longhaul operations – Jetstar.

    Jetstar has a lot of advantages that many others don’t to be fair. The backing of a major legacy carrier (Qantas) and obviously all the advantages that come with that.

    But it also seems a little more clever in the routes that it flies. Instead of competing with the legacy carriers on busy routes (exactly what Norse is planning on doing), Jetstar carves out under-served secondary routes where there is a health amount of leisure travel and little competition. Like Sydney – Phuket and Osaka.

    But yeah, it’s pretty easy to work out why longhaul loco isn’t as profitable as shorthaul –
    1) Aircraft utilisation: On short haul flights locos can squeeze out extra flying sectors each day. An extra flying sector equals extra revenue. On longhaul flights most of the locos are limited to the same aircraft utilisation rates as the legacy carriers.

    2) Auxillary revenue: When you have one aircraft flying 8 sectors a day that’s 8 opportunities from revenue for things like checked bags, handbaggage, check in, food and drink etc etc. A low cost longhaul airline will have maybe two opportunities per aircraft per day.

    3) Costs: On flights like LHR – CAI or TLV (think the 5 hour-ish mark) crews even on the new labour agreements with BA still operate one leg, get off and spend 24hrs there before doing one leg home the next day. Airlines like EasyJet which operate the same routes from London use the same crew to fly there and straight back.

  31. They have already raised millions from investors, like a lot of “tech innovations” the product is the stock price not what they are creating, and it appears they already have a successful stock price. Cant wait for Lucky to repost this story in a few years when the airline never actually takes the delivery of these planes.

  32. I have a few friends who flew the former Norwegian to Europe out of Newark back before the legacy airlines were completely retrofitted with PE class seats. They were, overall, disappointed. The upside was they flew in the front of a new plane in PE seats and the fares were fully flexible. The downside was, they had to position to Newark (does cost something for that) and the flights left at midnight or there about (late for most of us morning people). And in two cases, the flights were cancelled due to engine problems and there was no replacement plane and they were delayed for a day and forced to find a hotel. Not the bargain they anticipated.

  33. It is completely unfair to judge the viability of low-cost long-haul based on the past couple years (aircraft issues, Covid). I hope Norse gets up and running soon, and I plan to patronize their airline once it does.

    And, despite what some in Congress may think, we are not going back to the bad old days of overseas airline rate regulation when only the privileged could afford to fly.

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