Originally Posted by
SusanDK
While my data point is admittedly small and anecdotal, having flown transatlantic on Norwegian 9 times in a little over a year, I have not seen a single empty seat in either class (prem or econ) on any flight. This has been all from CPH to Florida (FLL or MCO), but in January (twice), April (twice), May, August, October, November and December. I know they offer premium economy upgrades for a reasonable price close to (or on?) the day of travel, but having booked several of our flights fairly late (i.e. within a few weeks of travel), I can attest that the premium seat map was nearly full when we booked. And they've usually announced during boarding that the flight is full. (Although our last flight at the end of April did have some last-minute bookings by people who were affected by the SK strike.)
That's why it is surprising to me that they are dropping all winter flights from CPH. MCO was always seasonal (summer) and the FLL flight was only twice per week in winter, but was full whenever we took it.
Susan, you are hitting on the item that has bugged me about Norwegian for quite a while now. It is likely that almost all of the tickets you purchased were sold at below operating cost. In essence, Norwegian's investors subsidized your ticket. The company did a great job as a regional European carrier of turning a profit, but whoever is responsible for Norwegian's yield management is completely incompetent. Norwegian's load factors have not been an issue; they are flying nearly full aircraft. But they're selling tickets at below cost. When a company does this, they eventually run out of investor money. Norwegian's run out of investor money twice in the last 18 months and has done two recapitalizations to keep operating. The last recapitalization of 3B NOK was half burned through in the first quarter of this year.
I stated in the last couple of months that Norwegian needed to raise their ticket prices a minimum of 10% just to get to breakeven and keep operating as a going concern. Instead, they have been having weekly fire sales of their seats through this entire summer. They have essentially put themselves out of business by doing this because they will need an even larger capital raise this fall in order to survive.
To me, it appears that Norwegian management gave up on running an airline and simply decided to make a roulette bet on the price direction of oil by taking such a large fuel hedge position. And at the moment, that bet is going very poorly for Norwegian.