djplong

I think it's hard for a lay-person to figure out Norwegian. I've flown with them a few times since they started their transatlantic services and, in general, I like them.

I mean, I'm on the fence about buying BOS-FCO in late September. With all these difficulties going on, I get an email two days ago advertising a new route from New York to *Athens*.

I figured I'd wait until some news in March comes out - but it's hard to "read the tea leaves" to see what shape they'll be in. I mean, who knows what they could axe in order to stay in business and I'd hate to make all the other planning for an Italian vacation only to suddenly lose out on the airfare that made it all possible. (Nonstops from Boston to Rome aren't easy to find, nor cheap)

I'm really pulling for Norwegian to succeed (since JetBlue doesn't seem to want to reveal WHEN they might start going to Europe) but with all this chaos???

iahphx

Ah, but that's the rub. They probably can't raise fares, as their customers will simply defect to the major carriers (in case you haven't noticed, there are TONS of cheap off-season fares across the Atlantic if you're looking for one). And Norwegian's costs are what they are: everyone needs to buy planes and fuel, and their operation is otherwise run on a pretty shoestring basis.

The problem is that the world doesn't need or want what Norwegian is selling. Pretty much everyone in the industry thought their model would fail. But Norwegian management somehow convinced some investors that everyone in the industry was wrong -- and then management piled on with a series of particularly boneheaded decisions. The odds that this turns out well are low. It's probably just a question of "when". But if Norwegian gets their money from their diabolical share offering, I think "when" is unlikely to happen for many months. If you can tolerate the risk, you might snag a bargain -- but I would only bite if their fare in much lower than the alternative. Folks who are simply vacationing and have some flexibility will almost certainly be better off booking with another carrier.

Often1

A further issue is IRROPS handling in the meantime. DY does not have interline ticketing agreements with other carriers, so rerouting is some number of days later. There are many threads here from people who were not provided hotel and meal vouchers and then vaguely told to submit receipts only to chase refunds for ages.

For well-resourced travelers, these are not the end of the world. But, for those on a budget -- presumably why they booked DY in the first place -- a few extra nights in a hotel for a family can run much more than they can afford and purchasing new tickets may be out of the question.

As the cash position deteriorates, conserving what remains becomes a greater priority.

If one must travel, I would hedge these risks with really high-quality travel insurance (may take something better than the average credit card).

The cheaper ticket may not be the less expensive journey.

iflyjetz

Mr Market agrees with your calculations. The stock gapped down on Wednesday open to 55 NOK.

This raises an interesting thought. IF the stock price drifts below 33 NOK before one exercises their rights, Norwegian raises zero new capital. This capital raise may not happen.

iflyjetz

The problem is that Norwegian's fares are depressing other carriers' tares. Once Norwegian goes belly up, other carrier prices will rise considerably.

iahphx

Interesting development. I thought the stock would logically trade down to 50 on the news. Some really bad choices for shareholders (but they are getting what they deserve from massively overvaluing this failing company). I still think it likely the share offering gets placed. We'll see.

77Pat

Just flew Norwegian for the first time CDG-JFK (actually landed about an hour ahead of schedule). Had flown in to LHR with Virigin Atlantic on points (premium economy). Not really an equal comparison, but I enjoyed both for what they were. Most other one way were cost prohibitive. Looking at the seating chart a few days out, it looked like a 1/4 full flight. Couldn't see the seating chart once locked (didn't feel like going through a dummy booking or signing up for expert flyer). But day of, it was packed. The row behind me had one empty middle seat, but someone ended up moving there once at altitude. I was somewhat amazed how many people chose the basic LowFare option (but this is only my second trip out of the country, don't have much experience traveling).

Without the Norwegian one way, would probably just have spent a week in Paris vs 2 destinations. Pricing for the 2 destinations on legacy was around $700-$800 (+$100 Eurostar) vs $300-$400 for just Paris r/t.

drsh99

[QUOTE=djplong;30804913]I think it's hard for a lay-person to figure out Norwegian. I've flown with them a few times since they started their transatlantic services and, in general, I like them."

I started a new thread asking for help as a first time norwegian flyer. I'd welcome advice! Flying this friday.

DeityAllah

MSPeconomist

Often1

It seems a bit of bravado by DY to suggest that it has a provable case against Boeing at this point. While I absolutely agree that various regulators quite properly grounded the aircraft, that does not mean that Boeing either did anything wrong or is liable. If it turns out that the grounding was not warranted by any action Boeing did or did not take, DY will have thrown good money after bad. But, in desperate times, that may be all that is left.

Im a new user

The cash injection succeeded. Stock exchange message here: https://newsweb.oslobors.no/message/471675You had to submit a binding resolution to subscribe the new shares about two days before the Ethiopian flight crashed, so it doesn't change anything with the rights issue. This issue of course costs DY a lot of money as some people will need hotel rooms, and the crew needs to be paid even if the flights are grounded.I suspect that DY simply try to sound innocent so that customers don't blame DY for flight cancellations. It is definitely too early to sue Boeing as it isn't yet known if Boeing has done anything wrong or not.

iflyjetz

Quote:

Originally Posted by Often1

It seems a bit of bravado by DY to suggest that it has a provable case against Boeing at this point. While I absolutely agree that various regulators quite properly grounded the aircraft, that does not mean that Boeing either did anything wrong or is liable. If it turns out that the grounding was not warranted by any action Boeing did or did not take, DY will have thrown good money after bad. But, in desperate times, that may be all that is left.

Payment by Boeing is written in the purchase contracts. This will almost certainly need to be covered by Boeing, although Boeing tries to 'pay' these obligations in discounts on future orders. That's how United (Boeing 787 penalties) ended up knee deep in cheap 737s and 777s.

Both Boeing and the FAA screwed up on the 737 Max. Buyers of the Max were unaware of the MCAS (Maneuvering Characteristics Augmentation System) including the pilots flying the Max until after the Lion Air accident. Not good. I fly the Airbus 320 family so I don't know what measures the fleet is taking but I suspect every single 737 pilot at my company is going to be required to go through a runaway trim simulator session by the time this is over. It's not cheap for the airlines.
I understand why Boeing opted for MCAS; they're continuing to stretch out the life of the 737. Personally, I thought the 737 had far outlived its usefulness when the -900 rolled off the line. In order to keep from dragging the tail on the -900, Boeing increased the approach speed to ludicrous speed with much longer landing distances. The very predictable result has been several -900s run off the end of the runway because they were unable to stop within the runway length. In fact, a 737 pilot told me a while back that United doesn't allow the 737-900 to land at LGA because of the long landing distance.

iahphx

I'm a bit skeptical of this criticism. Why would Boeing want to build a bad airplane? And why have so many airlines placed so many orders for it? Every airplane has limitations, but Boeing seems to have had huge commercial success with the MAX -- at least before these crashes. My guess from prior experience is that they'll be fine with the aircraft in the future. The 787 was also briefly grounded, and look how successful that airplane is today.

usbusinesstraveller

Norwegian's Chairman has resigned. Bjorn Kise (not Bjorn Kjos, he's the CEO) will step down at the annual shareholders' meeting in May.

Norwegian Air chairman Bjorn Kise resigns as turbulence hits carrier after failed bid from British Airways owner IAG | City A.M.