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NORWEGIAN

Norwegian’s subsidiaries in Denmark and Sweden go bankrupt

The struggling low-cost airline Norwegian has reported its staffing subsidiaries in Denmark and Sweden have filed for bankruptcy, meaning roughly three quarters of its pilots and crew will lose their jobs.

Norwegian's subsidiaries in Denmark and Sweden go bankrupt
A Norwegian Air Shuttle plane: Photo: Norwegian

In a press release issued on Monday afternoon, the airline said that the financial support packages offered by the Swedish and Danish government had not been sufficiently generous to keep the subsidiaries which employ pilots and cabin crew in the two countries solvent. 

”The impact the Coronavirus has had on the airline industry is unprecedented. We have done everything we can to avoid making this last-resort decision and we have asked for access to government support in both Sweden and Denmark”, said Norwegian's chief executive Jacob Schram in the statement.  

“Our pilots and cabin crew are the core of our business and they have done a fantastic job for many years.”

“It is heart-breaking that our Swedish and Danish pilot and cabin crew subsidiaries now are forced to file for bankruptcy, and I’m truly sorry for the consequences this will have for our colleagues,”  Norwegian's chief executive Jacob Schram said in the statement.  

“We are working around the clock to get through this crisis and to return as a stronger Norwegian with the goal of bringing as many colleagues back in the air as possible.”

The company said it was also immediately ending staffing deals with the OSM Aviation, which supplies it with crew based in Spain, UK, Finland, Sweden and the US.

The company said that 1,571 pilots and 3,134 cabin crew would be affected by the move, with only the 700 pilots and 1,300 cabin crew based in Norway, France and Italy being kept on.

In the release, the company blamed the “the lack of significant financial support” from the Swedish and Danish governments, which it contrasted with that of Norway, which has agreed to pay “all salary related costs” while staff are furloughed. 

The companies declared bankrupt include: 
 
Norwegian Pilot Services Sweden AB
 
Norwegian Pilot Services Denmark ApS
 
Norwegian Cabin Services Denmark ApS
 
Norwegian Air Resources Denmark LH ApS

Member comments

  1. The government of Sweden needs to help SAS. Norwegian is from Norway, that’s why Norway government help them.

  2. Norwegian isn’t even partly owned by the government. It’s a great company if things are going right but useless when a problem arises, as for trying to get EU law compensation for delayed flights, that’s a fight.
    They disingenuously sent emails out to customers whose flights had been affected offering them TWO forms of compensation, re-book or a voucher. The law states a money refund MUST be offered as well.
    Why would anyone want to accept the first two options when the airline industry, especially Norwegian, is in massive trouble? Norwegian were already heavily in debt before the virus trouble.

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NORWEGIAN

Norwegian to slash staff by half in wake of Trump travel ban

Norwegian Air Shuttle said on Thursday it would temporarily lay off up to half its staff, following the US travel ban and the novel coronavirus outbreak.

Norwegian to slash staff by half in wake of Trump travel ban
A Boeing 737 33-S operated by Norwegian landing at Oslo's Gardermoen Airport. Photo: Erlend Aas/ NTB Scanpix/AFP
“The new restrictions imposed further pressure on an already difficult situation,” Jacob Schram, CEO of Norwegian, said in a statement, referring to the 30-day travel ban from Europe to the US introduced by US president Donald Trump.
   
“Due to the extraordinary market situation as a result of the coronavirus… we must look at all possible measures to reduce costs,” the company said in a statement.
   
“This unfortunately also includes temporary lay-offs of up to 50 percent of our employees and the number may increase,” it added, confirming the staff would be let go.
 
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The low-cost carrier also said it was cancelling more than 4,000 flights, including 3,000 already announced on Tuesday.
   
“We do not rule out that others may follow,” airline spokesman Lasse Sandaker-Nielsen told AFP. “The situation is changing from minute to minute,” he told AFP.
   
According to the airline, about 40 percent of its long-haul fleet would be grounded as it was cancelling the majority of flights from European airports to the US.
   
The company said it would continue to operate flights between London — which is excluded from the travel ban — and the US, and hoped to re-route as many of its passengers as possible.
   
Norwegian, which has been in deficit for three years and is heavily indebted due to an ambitious expansion policy, especially in long-haul flights, has been plummeting on the Oslo Stock Exchange.
   
On Thursday, after the announcement by the US president, the share fell by 22 percent. The stock has fallen by over 80 percent in the last month.
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