LONDON – Norway based low-cost carrier Norwegian Air Shuttle has stated that it is willing to sell its takeoff and landing slots at London Gatwick in order to aid the repayment of bonds that are worth nearly $400 million.
Norwegian are requesting the extension of two bonds, the first due in December 2019 and the second due in August 2020, to which it is willing to put up its London Gatwick slots as collateral.
The airline is wanting to push the repayments back with the first one from December 2019 to November 2021 and the second one from August 2020 to February 2022.
Norwegian has stated, “The move is necessary to ensure successful operations and adequate liquidity headroom ahead of what is expected to be another tough winter season”.
Norwegian continued, “These are important operational rights for the Norwegian Group, facilitating the feeding of passengers between our European short-haul network and intercontinental long-haul network, an important part of Norwegian’s profitability strategy going forward.”
The Norwegian Group of airlines consists of, Norwegian Air Argentina, Norwegian Air International, Norwegian Air Norway, Norwegian Air Sweden, Norwegian Air UK and Norwegian Long Haul.
The whole group has a total of 160+ aircraft including Boeing 737NG’s (Next Generation), Boeing 737MAX’s, Boeing 787-8 Dreamliners and Boeing 787-9 Dreamliners.
This news would indicate that Norwegian are not doing very well in terms of profitability.
The fact it has to recover losses would suggest that the airline is in a little bit of trouble.
The airline’s 2018 annual report recorded the losses of the airline to be at around 2,200mNOK, with CEO Bjorn Kjos at the time attributing this to headwinds “such as uncertain and fluctuating fuel prices” as well as many other factors.
Another big factor would have been the grounding of its Boeing 737MAX aircraft, which will increase costs for aircraft storage and not using it on revenue flights.
All eyes will be on Norwegian to secure any deals to keep its operations at Gatwick, especially with the airport being a major player in its European and international operations.