Norwegian Air stability through summer?
#256
Join Date: Jul 2001
Programs: Marriott LT Tit; Hyatt Explorist; Hilton CC Gold; IHG CC Plt; Hertz (MR) 5 star
Posts: 5,536
Actually, I've used a substantial amount of time on my research. Thomas Cook did come up in my search but I had sort of dismissed them as I thought they were primarily a charter company with economy-only seating dealing in package vacations. But thank you for encouraging me to have a second look. We prefer at least premium economy, if not business class. I see that TC does have a premium economy although the seats are not as roomy as Norwegian's premium economy (I do like the Dreamliner). If we must take a connecting flight, I felt more comfortable booking a traditional airline.
Honestly, the travel that we've had to do this past year and a half has taken its toll - physically as much as financially - so a comfortable flight is as important as being cost effective. DY's direct flight in premium economy that didn't break the bank has really been appreciated, albeit I now recognize from this thread is unsustainable for them.
Most of my research has been with the 1-connection options (LH via FRA; AC via YYZ; SK via EWR, IAD or ORD; DL via AMS; FI via KEF; VS via MAN) in at least premium economy and they have been quite expensive when only booking one-way. I'm hoping that after the next trip or two, we will be able to start booking round-trip tickets that originate in the U.S. because I have found more reasonable fares for that itinerary.
Honestly, the travel that we've had to do this past year and a half has taken its toll - physically as much as financially - so a comfortable flight is as important as being cost effective. DY's direct flight in premium economy that didn't break the bank has really been appreciated, albeit I now recognize from this thread is unsustainable for them.
Most of my research has been with the 1-connection options (LH via FRA; AC via YYZ; SK via EWR, IAD or ORD; DL via AMS; FI via KEF; VS via MAN) in at least premium economy and they have been quite expensive when only booking one-way. I'm hoping that after the next trip or two, we will be able to start booking round-trip tickets that originate in the U.S. because I have found more reasonable fares for that itinerary.
If you're only buying your tickets ~2 weeks out, you'll have a pretty good idea of what Norwegian's finances are so it will be less risky to buy a ticket with that short before travel.
The short term concern that I see is their bond covenant that requires them to have a minimum of 1.5B in book equity. If they go below that amount, they will be in technical default on their bonds and it's up to the bondholders as to whether or not Norwegian will continue to operate or just be shut down. They had 3.1B in book equity at the end of the first quarter. This is why I've been watching their unrealized gains/losses in hedging very closely - that will add to/subtract from book equity.
Norwegian has, to date, had more lives than a cat. However, they have already burned through half of the fresh capital (3B NOK) that they raised in March at a new record pace for them. Whether investors are willing to throw more money at the company after losing that much money quickly is an unknown. Personally, I have to question why any investor would have put more money into this company in the last two years, as the company has not shown that they understand how to properly price their product. However, there may very well be another set of investors in Norwegian to keep them going.
Norwegian has a huge cost advantage over traditional airlines; their cost per available seat mile is ~7 cents vs 11+ cents for traditional airlines. That's why traditional airlines are more expensive than Norwegian - their costs are higher. If you're still flying this trip after Norwegian goes out of business, you can expect the price to be at least double what Norwegian charges due to both higher costs and airlines pricing their tickets at a point where they're profitable.
#257
FlyerTalk Evangelist
Join Date: Oct 2004
Location: SAN
Programs: Nothing, nowhere!
Posts: 23,223
Most of my research has been with the 1-connection options (LH via FRA; AC via YYZ; SK via EWR, IAD or ORD; DL via AMS; FI via KEF; VS via MAN) in at least premium economy and they have been quite expensive when only booking one-way. I'm hoping that after the next trip or two, we will be able to start booking round-trip tickets that originate in the U.S. because I have found more reasonable fares for that itinerary.
#258
Join Date: Jul 2001
Programs: Marriott LT Tit; Hyatt Explorist; Hilton CC Gold; IHG CC Plt; Hertz (MR) 5 star
Posts: 5,536
In the UK there is scheduled airline failure insurance, sometimes as an option and often included in better policies. It can also be bought as a stand alone policy. Look for something similar in your location.
https://www.gocompare.com/travel-ins...ure-insurance/
https://www.gocompare.com/travel-ins...ure-insurance/
#259
Suspended
Join Date: Jul 2001
Location: Watchlisted by the prejudiced, en route to purgatory
Programs: Just Say No to Fleecing and Blacklisting
Posts: 102,103
Actually, lower oil prices might end up shutting them down quickly, as Norwegian is overhedged. Let's wait until we see how much they're carrying in unrealized hedging losses in the May traffic figures report which will be released in the next couple of weeks. Anything over a billion NOK in unrealized losses and they'll likely have blown through their minimum capitalization covenants.
In addition, Norwegian has been running nearly nonstop fare sales through the summer. This indicates to me that they are running very low on cash and are struggling to just meet payroll.
Someone's been selling the stock aggressively in the last few weeks.
In addition, Norwegian has been running nearly nonstop fare sales through the summer. This indicates to me that they are running very low on cash and are struggling to just meet payroll.
Someone's been selling the stock aggressively in the last few weeks.
#260
Suspended
Join Date: Jul 2001
Location: Watchlisted by the prejudiced, en route to purgatory
Programs: Just Say No to Fleecing and Blacklisting
Posts: 102,103
With throwaway-the-return-part of the roundtrip tickets, a very useful approach can be this: pushing out the return trip date to the furthest possible date that still gets the cheap price.
#261
Join Date: Jul 2001
Programs: Marriott LT Tit; Hyatt Explorist; Hilton CC Gold; IHG CC Plt; Hertz (MR) 5 star
Posts: 5,536
The NA industry cartel kingpins have also been running fare sales through the summer at least for EU/Schengen-area-originating trips. Some of the August and September travel ticket prices I've been seeing for EU/Schengen-US-EU/Schengen trips are the cheapest, non-flash sales I've seen legacy majors offer for such trips over the last twenty years -- and that's in nominal USD-terms. In terms of real USD terms (i.e. inflation-adjusted), the legacy majors seem to be undercutting their historical prices way more. To some this may speak of a desire of the legacy majors of trying to hit DY with a coup de grace. But that blow against DY and TATL-flying consumers in the main won't happen before the summer is over. And so my purchases for DY flights for August and September summer travel continue as usual.
It's always great to read posts from someone who has zero concept of the production cost of anything and babbles monopoly/cartel at every opportunity.
Pray tell, what product does your employer sell?
#262
Suspended
Join Date: Jul 2001
Location: Watchlisted by the prejudiced, en route to purgatory
Programs: Just Say No to Fleecing and Blacklisting
Posts: 102,103
Great. The 'I remember when sodas were a nickel and candy bars this big (both arms fully outstretched) were a dime' guy is back.
It's always great to read posts from someone who has zero concept of the production cost of anything and babbles monopoly/cartel at every opportunity.
Pray tell, what product does your employer sell?
It's always great to read posts from someone who has zero concept of the production cost of anything and babbles monopoly/cartel at every opportunity.
Pray tell, what product does your employer sell?
It's the TATL-flying legacy majors -- more specifically, those granted governmental waivers and favors to collude -- that are undercutting the prices of Norwegian to such a large extent that it puts to shame your concept of Norwegian selling below costs. Wasn't it you that said that it's legacy majors that have higher costs than Norwegian? And yet it's the legacy majors that are undercutting Norwegian prices for September travel tickets for EU/Schengen-US roundtrip travel. Go figure.
Sodas may have been a nickle in your time, but they generally weren't that nominally cheap 20 years ago or even today when it comes to vending machine purchases or even purchases at say middle/junior high school sporting events. Given what you said above, I must say it seems like you are admitting that you are the 'I remember when sodas were a nickel and candy bars this big (both arms fully outstretched) were a dime" guy, while my mention here just covers the FT era.
Last edited by GUWonder; Jun 4, 2019 at 7:40 am
#263
FlyerTalk Evangelist
Join Date: Oct 2004
Location: SAN
Programs: Nothing, nowhere!
Posts: 23,223
CPH-US-CPH has been going for around $180-$280 roundtrip for September travel dates in economy class. The one-way ticket prices for CPH-US have been way more expensive for the same dates as the CPH-US part of the CPH-US-CPH tickets. Can't speak as much to the premium economy prices, but buying up on the economy class tickets can work wonders at saving money at time, but it may require a gamble of ending up in economy class.
With throwaway-the-return-part of the roundtrip tickets, a very useful approach can be this: pushing out the return trip date to the furthest possible date that still gets the cheap price.
With throwaway-the-return-part of the roundtrip tickets, a very useful approach can be this: pushing out the return trip date to the furthest possible date that still gets the cheap price.
#264
Suspended
Join Date: Aug 2010
Location: DCA
Programs: UA US CO AA DL FL
Posts: 50,262
It is not simply insolvency, but both last minute schedule cuts and IRROPS which pose problems. Some or all of that may or may not be fixed by EC 261/200r or insurance, but it can be a slog. While not every carrier will rebook OA for a 1-2 hour delay, when the wait is 2-3 days, it is not much of a worry. With ULCC's on long-haul, this can be a real problem.
Presuming that one is budget-minded in the first instance, it is worth considering whether the cheapest ticket is always the least expensive journey.
Sitting in a hotel for 2-3 days and hoping that one will be reimbursed at some point and fretting about missed work back home is a consideration which goes well beyond insolvency.
Presuming that one is budget-minded in the first instance, it is worth considering whether the cheapest ticket is always the least expensive journey.
Sitting in a hotel for 2-3 days and hoping that one will be reimbursed at some point and fretting about missed work back home is a consideration which goes well beyond insolvency.
#265
Suspended
Join Date: Jul 2001
Location: Watchlisted by the prejudiced, en route to purgatory
Programs: Just Say No to Fleecing and Blacklisting
Posts: 102,103
Indeed, it can be useful for those trying to use the US VWP to travel to the US, or for those traveling to the EU as a tourist with non-EU/non-Schengen countries' passports. But neither the EU/Schengen authorities nor US authorities would care about me providing evidence of a plan to leave.
#266
FlyerTalk Evangelist
Join Date: Oct 2004
Location: SAN
Programs: Nothing, nowhere!
Posts: 23,223
It is not simply insolvency, but both last minute schedule cuts and IRROPS which pose problems. Some or all of that may or may not be fixed by EC 261/200r or insurance, but it can be a slog. While not every carrier will rebook OA for a 1-2 hour delay, when the wait is 2-3 days, it is not much of a worry. With ULCC's on long-haul, this can be a real problem.
Presuming that one is budget-minded in the first instance, it is worth considering whether the cheapest ticket is always the least expensive journey.
Sitting in a hotel for 2-3 days and hoping that one will be reimbursed at some point and fretting about missed work back home is a consideration which goes well beyond insolvency.
Presuming that one is budget-minded in the first instance, it is worth considering whether the cheapest ticket is always the least expensive journey.
Sitting in a hotel for 2-3 days and hoping that one will be reimbursed at some point and fretting about missed work back home is a consideration which goes well beyond insolvency.
#267
Join Date: Jun 2004
Posts: 3,742
I believe I posted a thread some months ago asking for advice about how to identify an appropriate fare class if I bought a round-trip ticket where I could change the return date (for a fee) after taking the outbound. I haven't figured out the best way to do this - a little nervous about misunderstanding a fare class and not being able to make a change (even with a fee) once the outbound has been flown, and then losing the entire cost of the return.
For comparison sake, I've been paying ca. $850 - $900 for a one-way premium economy flight on DY between either MCO or FLL and CPH. The least expensive alternative has been to purchase a non-refundable, non-changeable round-trip ticket on a legacy carrier with a connection for ca. $2,000. So to do this and throw away the return is more than double the cost of DY.
I will definitely continue to monitor fares on the legacies, particularly for our next flight which is likely to be in July. The input here has been useful and most appreciated.
#268
Join Date: Jun 2004
Posts: 3,742
It is not simply insolvency, but both last minute schedule cuts and IRROPS which pose problems. Some or all of that may or may not be fixed by EC 261/200r or insurance, but it can be a slog. While not every carrier will rebook OA for a 1-2 hour delay, when the wait is 2-3 days, it is not much of a worry. With ULCC's on long-haul, this can be a real problem.
Presuming that one is budget-minded in the first instance, it is worth considering whether the cheapest ticket is always the least expensive journey.
Sitting in a hotel for 2-3 days and hoping that one will be reimbursed at some point and fretting about missed work back home is a consideration which goes well beyond insolvency.
Presuming that one is budget-minded in the first instance, it is worth considering whether the cheapest ticket is always the least expensive journey.
Sitting in a hotel for 2-3 days and hoping that one will be reimbursed at some point and fretting about missed work back home is a consideration which goes well beyond insolvency.
The bigger problem may be what USA_flyer referred to. I'm not sure what would happen if my DY flight is cancelled while in CPH and I'm at the end of my 90/180 allowable stay. Would I be forced to purchase a ticket at any price to leave Schengen if DY only reschedules for a week later?
For us, we aren't flying DY to be budget-minded as a first priority. We actually value the non-stop flight above anything. After the itinerary, then we look at price and certainly are budget conscience at that point. All things being equal, if I offered my husband a DY flight in premium economy that is direct and then told him we could fly SK or LH or DL in business class for the same price but with a connection, he would tell me to book DY.
#269
Join Date: Jul 2001
Programs: Marriott LT Tit; Hyatt Explorist; Hilton CC Gold; IHG CC Plt; Hertz (MR) 5 star
Posts: 5,536
That was an expected response. The financial metrics of your industry are likely much more monopolistic than the airline industry, where many startups have emerged since deregulation and few survive.
[QUOTE=GUWonder;31169059]It's the TATL-flying legacy majors -- more specifically, those granted governmental waivers and favors to collude -- that are undercutting the prices of Norwegian to such a large extent that it puts to shame your concept of Norwegian selling below costs. Wasn't it you that said that it's legacy majors that have higher costs than Norwegian? And yet it's the legacy majors that are undercutting Norwegian prices for September travel tickets for EU/Schengen-US roundtrip travel. Go figure. [/QUOTE]
Pure fiction. Are you now suggesting that governments are part of this imagined cartel/conspiracy to price tickets at such 'high' levels? In reality, airline ticket prices have risen less than just about every other item one purchases. There's a reason why so many people travel today, and it's not because of high ticket prices.
And you're now claiming that legacies have lower prices than Norwegian for September? Pick a couple of city pairs. I looked (posted below) at it's just another made up statement by you.
ucdtim17 wasn't able to find anything close to Norwegian's fare for Paris-OAK (SFO area) in September. I tried to, and the only thing I could find was French Bee.
I pulled up a New York to London price on Kayak for September and the only airline that was lower than Norwegian was Aeroflot. None of the legacy majors.
Sodas may have been a nickle in your time, but they generally weren't that nominally cheap 20 years ago or even today when it comes to vending machine purchases or even purchases at say middle/junior high school sporting events. Given what you said above, I must say it seems like you are admitting that you are the 'I remember when sodas were a nickel and candy bars this big (both arms fully outstretched) were a dime" guy, while my mention here just covers the FT era.
This cartel that you rail against is the result of decades of deregulation, where the airline industry lost so much money that the only way to achieve the current rational pricing was consolidation.
One can now fly from one coast to the other, round trip in first class, for less than the latest iPhone. Air travel is dirt cheap, no matter how often you say otherwise. The problem is that you do not understand how much it costs to fly an aircraft from point A to point B.
#270
Suspended
Join Date: Jul 2001
Location: Watchlisted by the prejudiced, en route to purgatory
Programs: Just Say No to Fleecing and Blacklisting
Posts: 102,103
HYou have no clue about what I know and dont know this is for sure.
The filed economy class fares for September CPH-US-CPH travel for the TATL-flying industry cartel kingpins was lower than any round trip fare I have ever seen DY sell for September CPH-US-CPH for example.
Sub-$290 all-in ticket prices, with it as low as under 155 round trip on some legacy majors.
https://www.secretflying.com/posts/c...282-roundtrip/
Who is trying to run DY into the ground? Certainly not DY itself, as good a job as they do of it themselves. The predatory pricing is being done by legacy majors, no less so when the variable costs of the legacy majors tend to be higher than the variable costs of an LCC.
The filed economy class fares for September CPH-US-CPH travel for the TATL-flying industry cartel kingpins was lower than any round trip fare I have ever seen DY sell for September CPH-US-CPH for example.
Sub-$290 all-in ticket prices, with it as low as under 155 round trip on some legacy majors.
https://www.secretflying.com/posts/c...282-roundtrip/
Who is trying to run DY into the ground? Certainly not DY itself, as good a job as they do of it themselves. The predatory pricing is being done by legacy majors, no less so when the variable costs of the legacy majors tend to be higher than the variable costs of an LCC.
Last edited by GUWonder; Jun 4, 2019 at 2:04 pm