Norwegian airlines has announced a cost reduction plan to close bases on Gran Canaria, Palma de Mallorca and Tenerife, as well as the cancellation of the Tenerife South-Rome route along with capacity reductions on some other routes. The decision does not affect any of the other five bases operated by Norwegian in Spain: Alicante, Barcelona (with two bases: short and long haul), Malaga or Madrid, nor its corporate headquarters in Barcelona.
Of the 122 routes they offer from 13 Spanish airports, only the one that connects Tenerife South with Rome is to be canceled, although the airline has specified that there will be a certain number of small capacity reductions on some other routes from Palma de Mallorca and Tenerife.
Specifically, starting next summer, the routes connecting Palma de Mallorca with several cities will be affected, Copenhagen reduced from 14 to 13 weekly frequencies, Oslo, from 9 to 8 weekly frequencies, Dusseldorf, from 9 to 7 weekly frequencies, and Helsinki, from 7 to 6 weekly frequencies. The Tenerife North-Madrid route will also be reduced from 9 to 7 weekly frequencies.
Norwegian, the sixth largest airline in Spain by passenger volume, transported 8.93 million passengers to and from the country during 2018, 6% more than in 2017.
COSTS REDUCTION PROGRAM
As part of its cost reduction program, Norwegian has initiated a comprehensive review of operations with its Boeing 737 (both the 800 and MAX 8 models), with the aim of improving profitability, reducing the commercial impact of seasonality and, therefore, hoping to increase revenues and profitability while reducing costs.
The aim of the Norwegian airline, which employs 11,000 people around the world, is to ensure that the least possible number of workers are affected by these changes. For this, it proposes relocation transfers to long-range operations (with the Boeing 787 Dreamliner), basic transfers of facilities and similar requests, all in an attempt to avoid redundancies.
All these measures will result in the suspension of routes and bases in Europe and the United States. The decision affects some of the routes that are being operated by the Boeing 737-800 and 737 models. MAX 8, which are mainly used on European routes but also on those that connect with the United States or the Middle East.
“The company has reached a point where it needs to make the necessary adjustments in its route portfolio to improve its sustainability and financial performance in this highly competitive environment,” said Helga Bollmann Leknes, Norwegian commercial director and managing director of Norwegian Air Resources.
She also explained that these measures, including the plans to close bases, have been communicated to the unions, with which dialogue has already begun, and reiterated the “clear objective” of avoiding redundancies.