Norwegian Air stability through summer?
Jan 24, 2019, 11:16 pm
#1
Original Poster
Join Date: Jan 2013
Posts: 69
Norwegian Air stability through summer?
Hey all,
Back in November, I purchased a RT ticket on Norwegian for a family member to travel in April/May this year - it had the best schedule and price for this particular trip. Now comes the news that IAG is selling off their stake in Norwegian, which is obviously concerning. I know no one can see the future, but what is the likelihood that Norwegian remains stable through the summer months? Some reports indicate that they have enough cashflow to operate at least through the end of the year.
Is it best to just eat the cost of the ticket and rebook on a legacy carrier, at the expense of schedule/nonstop flights? Wait until closer to departure to see what happens? Some other option?
Back in November, I purchased a RT ticket on Norwegian for a family member to travel in April/May this year - it had the best schedule and price for this particular trip. Now comes the news that IAG is selling off their stake in Norwegian, which is obviously concerning. I know no one can see the future, but what is the likelihood that Norwegian remains stable through the summer months? Some reports indicate that they have enough cashflow to operate at least through the end of the year.
Is it best to just eat the cost of the ticket and rebook on a legacy carrier, at the expense of schedule/nonstop flights? Wait until closer to departure to see what happens? Some other option?
Jan 25, 2019, 12:16 am
#2
Join Date: Jan 2017
Location: Portland OR
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Norwegian’s financial stability (or lack of) is discussed ad infinitum here.
Norwegian to fly between UK, Ireland and U.S. NE Coast cities. from Summer 2017.
It's also come up recently on another thread -
Norwegian closing bases in RI and NY
Norwegian to fly between UK, Ireland and U.S. NE Coast cities. from Summer 2017.
It's also come up recently on another thread -
Norwegian closing bases in RI and NY
Jan 25, 2019, 3:21 am
#4
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IAG has/had circa 4% of Norwegian shares so it is not a significant holding. They only bought them to try and get themselves a little more leverage in possible take over talks.
It does appear that Norwegian do have sufficient funding and have started to make savings as well to improve their cash balances. Personally I would just keep a watching brief and make a decision closer to the time of the actual flights.
It does appear that Norwegian do have sufficient funding and have started to make savings as well to improve their cash balances. Personally I would just keep a watching brief and make a decision closer to the time of the actual flights.
Jan 25, 2019, 4:21 am
#5
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A 4% shareholding wouldn't have gotten IAG any inside information. So no reason to fear the imminent demise of Norwegian based on IAG selling out.
More likely they are feeling strong and cash generation would be good heading into the peak summer leisure travel season. So no need to engage with IAG on selling the airline on the cheap...
More likely they are feeling strong and cash generation would be good heading into the peak summer leisure travel season. So no need to engage with IAG on selling the airline on the cheap...
Jan 25, 2019, 6:05 am
#6
Join Date: Dec 2015
Posts: 91
Britain’s “Daily Telegraph” newspaper speculates today that Lufthansa might still be interested- “Carsten Spohr, chief executive of the German airline, said last June there was “a new wave of consolidation approaching” and Lufthansa was “in contact” with Norwegian.” I have no idea whether there is anything in this.
Jan 25, 2019, 6:21 am
#7
Join Date: Jan 2016
Posts: 2
I'm having the same questions, I just booked 4 tickets from PVD to Cork for July/August through Chase Ultimate Rewards on Norwegian. I have until this afternoon to cancel without penalties. My fear is that we won't know the real situation until April, when it will be too late to rebook award tickets with Aer Lingus. That could mean no trip at all. Unfortunately, the PVD to Cork route is perfect for us because we are so near our start/end points.
Jan 25, 2019, 7:56 am
#8
Join Date: Jan 2010
Posts: 1,331
Britain’s “Daily Telegraph” newspaper speculates today that Lufthansa might still be interested- “Carsten Spohr, chief executive of the German airline, said last June there was “a new wave of consolidation approaching” and Lufthansa was “in contact” with Norwegian.” I have no idea whether there is anything in this.
Jan 25, 2019, 8:46 am
#9
Join Date: Sep 2004
Posts: 309
I've got the same fears, I'm booked on a ticket from LHR-MIA (or maybe it's a different London airport, I'll figure it out before the flight!) in mid-May. It would be inconvenient to have to rebook a few weeks out, though at least London is a good airport to do it from, I suppose.
Jan 25, 2019, 10:40 am
#11
Join Date: May 2017
Posts: 2,016
Britain’s “Daily Telegraph” newspaper speculates today that Lufthansa might still be interested- “Carsten Spohr, chief executive of the German airline, said last June there was “a new wave of consolidation approaching” and Lufthansa was “in contact” with Norwegian.” I have no idea whether there is anything in this.
Jan 25, 2019, 12:08 pm
#12
Join Date: Jul 2001
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January traffic will be released on February 5 and Q4 earnings call is February 14.
Id wait until the earnings call.
Jan 25, 2019, 1:19 pm
#13
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I've got the same fears, I'm booked on a ticket from LHR-MIA (or maybe it's a different London airport, I'll figure it out before the flight!) in mid-May. It would be inconvenient to have to rebook a few weeks out, though at least London is a good airport to do it from, I suppose.
Jan 25, 2019, 3:47 pm
#14
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All a matter of risk tolerance. A recent cash infusion assures operations through March. After that is reading tea leaves unless one has inside information. And even then.
This is a way of saying that there is no person on FT who can tell you what will happen with anything April or later. Brexit, US interest rates, China trade, weather, and volcanic ash, may all combine to keep it afloat or sink it.
This is a way of saying that there is no person on FT who can tell you what will happen with anything April or later. Brexit, US interest rates, China trade, weather, and volcanic ash, may all combine to keep it afloat or sink it.
Jan 25, 2019, 5:15 pm
#15
Join Date: May 2005
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I would say it is not looking good for them! The bonds are now yielding over 30% ... way beyond even junk, so the price must have gone down to 1/2 just in the last few days after halving in Dec. Anyone looking for a bunch of cheap 787s would be buying the bonds ... IAG seem to have figured out the equity is worthless, so probably doing just that. They look to be senior debt so first in line in a BK.
See the Bloomberg link below from today, which is not pay walled. I'm flying them to LGW-OAK Tue and not even certain they will make it that, far at this point. The fall in advance bookings on this kind of news have to be devastating for cash flow.
https://www.bloomberg.com/opinion/ar...-ba-walks-away
Having said all they the have their act together now on operations, and are pleasant to fly. You would want to have a mileage ticket on another carrier you can use last minute and obviously use a credit card to book. I would suggest waiting as long as you can too to book too.. They do seem to open cheaper fare buckets back up close in to flights. For example the lowest possible Premium fares for Tue 29 Jan are currently still being offered LGW to both LAX and OAK.
See the Bloomberg link below from today, which is not pay walled. I'm flying them to LGW-OAK Tue and not even certain they will make it that, far at this point. The fall in advance bookings on this kind of news have to be devastating for cash flow.
https://www.bloomberg.com/opinion/ar...-ba-walks-away
Having said all they the have their act together now on operations, and are pleasant to fly. You would want to have a mileage ticket on another carrier you can use last minute and obviously use a credit card to book. I would suggest waiting as long as you can too to book too.. They do seem to open cheaper fare buckets back up close in to flights. For example the lowest possible Premium fares for Tue 29 Jan are currently still being offered LGW to both LAX and OAK.
