LONDON – In the wake of Wizz Air (W6) entering the Norwegian domestic market, the Pilots union in Norway have responded negatively. The push for minimum airline ticket prices, as we see in Austria, has become the talking point.
Wizz Air announced last week that it would base two aircraft at Oslo Gardermoen Airport (OSL) operating services to Bergen (BGO) four times a day, Tromso (TOS) four days a week and to Trondheim (TRD) twice-daily.
The CEO Joszef Varadi talked about the level of duopoly between the likes of Norwegian Air (DY) and SAS (SK) and how that needs to be broken. “Norway has been a cozy duopoly between SAS and Norwegian. We want to break it up and we will offer a clear alternative to travelers in Norway; a more efficient, cleaner, and more sustainable alternative.”
What Have The Unions Said?
The Norwegian Pilots Association (NPA) believes it may be worthwhile that the Norwegian air market sees a minimum price for airline tickets set.
In Austria, it is currently €40 due to ultra-cheap tickets, undermining the policy of climate and liveable wage standards in the country. Union leader Yngve Carlsen continued to state the view that it might be worth the government investigating.
“This is definitely an interesting way to go. In general, there is free competition, and the companies themselves set the prices. But when some companies lower the price to about what a cup of coffee costs at Gardermoen, something is not as it should be.”
How Cheap Are The Flights?
The NPA has criticized the price point that W6 is entering the market in, with some flights starting from 199 NOK (US$21.75). This is compared to 698NOK (£58.50) that SK is charging.
As for DY, you can pick up a ticket for 224NOK (£18.80) under the LowFare name, but the Flex fare, which is similar to SK’s price point, is charged at 1027NOK (£86).
Such data has been acquired via a price search across W6, DY and SK for a one-way flight from OSL to BGO on November 5, which is when W6 is due to begin services.
Government Fighting Begins
In the Norwegian opposition, the transport policy spokesman for the Labor Party sent a letter to the Minister of Transport Knut Arlid Hareide, asking whether such a minimum price should be set. Hareide later responded to spokesperson Sverre Myrli stating that this may not be the case due to legislation set under EU/EEA law.
“The starting point, according to the basic market regulation for air transport in the EU / EEA, is that the airlines are free to determine the price of their tickets.” So in this case, it is down to the Norwegian government to implement this price change, like what the Austrians did, unless it finds such infringements in trade law.
At the time of writing, there is currently no government intervention being made on the arrival of W6 next month. This will no doubt make DY and SAS sweat substantially, especially with the continued pressures of the COVID-19 pandemic applying further downturn to the market.
For W6, this is a fantastic opportunity for the airline to penetrate the market, especially with DY struggling with the pandemic as well as SAS having to be capitalized by the Scandinavian governments and on the brink of receiving fines for not refunding customers.
With W6 receiving more aircraft from lessors and launching more routes in the UK, Abu Dhabi, and beyond, this places the airline in a very strong position, especially during COVID-19. All that DY and SK can do at the present time is to wait and see what the impending damage and how viable the two carriers will become as we enter the last few months of the year.
Featured Image: Wizz Air UK Airbus A320. Photo Credit: Wikimedia Commons