Norwegian Grounding 40% Of Planes, Laying Off Up To 50% Of Employees

Filed Under: Norwegian

Update: Norwegian has now announced that they will be cutting all long haul flights, and laying off 90% of employees. The airline may be getting additional funding from the government of Norway.

This doesn’t come as much of a surprise, but Norwegian has just announced that they’re grounding 40% of long haul planes, and laying off up to 50% of employees.

Norwegian grounding 40% of long haul fleet

Following the new US travel ban on Europe, Norwegian has announced that they’re grounding 40% of their long haul fleet and canceling up to 25% of short haul flights until the end of May.

As Jacob Schram, Norwegian’s CEO, describes the situation:

“This is an unprecedented situation and our main priority continues to be the care and safety of our customers and colleagues. The new restrictions imposed further pressure on an already difficult situation. We urge international governments to act now to ensure that the aviation industry can protect jobs and continue to be a vital part of the global economic recovery.”

Which Norwegian flights are being canceled?

For the time being, Norwegian will continue to operate all 11 routes between London Gatwick and the US. Norwegian will try to reroute as many passengers as possible onto these flights.

In terms of cancelations:

  • From March 13-29, 2020, Norwegian will cancel most long haul flights to the US from Amsterdam, Barcelona, Madrid, Oslo, Paris, and Stockholm
  • From March 13 until the end of May, Norwegian will cancel all flights between Rome and the US
  • From March 29 until the end of April, Norwegian will cancel all flights from Amsterdam, Athens, Barcelona, Madrid, Oslo, and Paris

Norwegian laying off up to 50% of employees

Norwegian has also revealed that due to this extraordinary situation, the company is looking “at all possible measures” to reduce costs. The airline plans to temporarily lay off up to 50% of employees, and that number may increase. All departments will be impacted by these layoffs.

The airline has initiated a discussion with unions about the process.

Can Norwegian survive this?

In many ways you can’t help but feel bad for Norwegian. Their business model was questionable to begin with, but they’ve also been supremely unlucky. They relied on the 737 MAX 8 and 787-9 for long haul flights, and they’ve had huge issues with both of those planes.

The airline has been undergoing a turnaround effort that really has been handled as well as it could be, and now they’re dealing with this.

Even with this Norwegian is taking drastic measures, but you can’t help but wonder if the company can make it through this. Their stock is down 19% today alone…

I would be extremely impressed if the company is able to make it through this.

Bottom line

All airlines are being hit hard by this situation, but Norwegian is probably being hit harder than most others. Their long haul operations are focused around travel between the US and Europe, and this latest travel ban will hit them hard.

The company was already on life support before all of this started, and this will only make things worse…

Comments
  1. I’m really sad about this. They’re a fantastic airline and all the issue have been outside their control.

    It’s not their fault Boeing f-ed up the 787 engines.
    It’s not their fault Boeing f-ed up the 737 max.
    It’s not their fault global travel is coming to a standstill.

    What especially annoys me is 5 years from now, people will point to their carcass and say “see, their strategy was bad”.

    No it wasn’t!

  2. Tourism take on the biggest hit in history…thanks to China.
    When China sneezes the whole world get sick.

  3. Is there a country, where this would benefit them? This is crazy. The infection speed is off the chart. Not seen anywhere other than military grade virus. Fingerprints of biological warfare. any thoughts?

  4. @james S rolls royce messed up the engines
    @endre 100% correct. China’s top level bio lab in right next to the fish market

  5. Not really about Norwegian (even though they originated here), but Norway has enacted one of the strictest travel policies in the world. Any person who enters the country from outside the other Nordic countries will have to be in house quarantine for two weeks after entering the country. This is valid retroactively to February 27. And all health professionals working in patient care are legally prohibited from leaving the country (privately or on business) for now until the end of April.

  6. It is debunked the virus is manmade – Current biotech can’t do this many mutations in its genetic information.
    However, surely it can’t be ruled out intentional or just accidental leak from the lab. And imo if not, China won’t try to throw the blame to US (Which is as crazy as what Trump’s doing.

  7. @Endre is Back.
    How was your first class trip on Cathay this week? Or was it with Air France?

  8. This is really unfortunate for Norwegian. First the 787 engine issue hurt them bad in 2018. Then the 737 Max in 2019. While they secured a credit card deal that could have had them profitable for years to come this happens. All travel from East should have been haunted when a Trump banned Chinese flights to the U.S. Not all countries banned Chinese travel and too many East Asian countries had flights, cruises and ferries operating between China.

  9. @Stanley. That’s a different end result you’re thinking of. I think that was the “debit endre”.

  10. @Ethan The whole virus isn’t man made, but it definitely appears it might have been altered to have a faster and more deadly transmission rate. I mean you just have to look at what’s happening all over the world. This is not normal flu!

  11. @James S
    It’s a great model until something does go wrong- at which point it’s a terrible model as all other airlines have managed to survive when presented with the 737 max and 787 engine issues.
    The truth is, the Norwegian model doesn’t leave much room for when things go wrong.

  12. My 25 year old son is booked on Norwegian to London tonight…the FC match he was going for is cancelled…London is a ghost town…
    And they won’t even offer him the option of changing dates on his ticket!

  13. Pentagon is right off the White House. And they weaponized Trump to benefit the Military Industry Complex win the most!
    Human are full of idiots.
    https://www.biorxiv.org/content/10.1101/2020.01.30.927871v1. READ the English comments from Stanford/John Hopkins/ u of Wisconsin bio research PhD study.
    When we work hard to study the virus and treat patients, regular citizens believe that “my aunt’s colleague has a friend in cdc, she said blablabla…”
    We already has in house COVID test but has limited capability. We developed in 7 days. Right now we also study patient’s body fluid to track the infection possibility to better protect fellow treatment team and general public. This is already so bad the entire western world is blind for the past three weeks. Singapore, Taiwan, South Korea, China (except Wuhan local gov) and even Philippine are acting much more aggressive than us.
    The top infectious prevention committee and the chief microbiologist in my company had a meeting with our researchers and treatment team. We know it is inevitable since we honor freedom more than lock down. Italy health system is collapsing, as well as Evergreen in kirkland, Washington. But we know it will happen since we know what happened one month ago in Wuhan, China. Right now I’m just praying my material management team can have enough mask and faceshield for me. Our RN team already contacted their Union rep just in case the dirty court fight between healthcare prof union and city/state gov. This will be bad, really really bad.

  14. I have a flight w/ Norwegian before the end of March from JFK-CDG.

    I haven’t heard anything from them yet, will I get a refund?

  15. Conspiracy theorists head history, the world has a huge pandemic every few hundred years. We get these minor ones every twenty to one hundred years

  16. Major bummer if they fold. Their direct MCO – CDG route was my preferred way to get to the EU.

    So many unknowns…

  17. IAG will be checking to see if they’ve got enough money to weather the storm of Coronavirus as well as acquiring Air Europa. They might have enough money on the table to take over Norwegian if IAG can be very careful with their balance sheet over the next few months. When Willie Walsh retires Norwegian will be in IAG’s sights.

  18. @ Victoria

    I was in London for dinner with friends on Saturday night, it certainly is not a ghost town. At midnight the West End was packed. People and cars everywhere.

    No concern at all for any kind of disease transmission.

  19. Feel bad for the employees.
    Obviously coronavirus isn’t something we’d have expected to happen (or impotus banning all EU-US flights (without notice to even the EU countries I might add)), but Norwegian’s business model left no room for issues outside their control. Rolls engines on the 78 should have been the wake up call, but they kept going and leased jets instead.
    I’d be surprised if they make it a few more weeks sadly. UK travel agencies being told to no longer sell Norwegian flights (along with Cathay, TUI and others) won’t help either.
    Maybe IAG will come in for them again – especially for those LGW slots now the third runway at LHR is cancelled.

  20. I’ve flown Norwegian from the beginning. Great planes, great service (except at checkin), and of course great prices. They were unfairly blocked first by the FAA, (trying to protect the US carrier monopoly), then their bad luck with Boeing (when nobody knew) . I will be very sorry to seem them fail as they were a great model for low cost air travel. Expect prices to rise with a jolt when the virus is over without Norwegian.

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