We Need Norwegian’s Wings

Finns and Swedes need to have competition in the air otherwise we are stuck with SAS and Finnair, two of the most uncompetitive companies on earth, at least on this Nordic earth! Both companies were set up as national champions and enjoyed years and decades of near monopoly positions at our airports. They have been able to secure the best slots and dictate the highest possible prices, which is fine for the governments and big companies who see travel costs as a small expense item, but the worst possible solution for ordinary travellers and smaller exporters.

The cost of airline tickets has always been high for ordinary people who want to escape our mainly cold and wet climate, and for exporters who need to make face-to-face contact with buyers in far flung regions of the globe.

Finland and Sweden are both stuck in the far northern part of the globe where we enjoy, for the most part, long hard autumns and winters, with shorter spring and summer breaks.

There have been several assaults on Finnair’s and SAS’s home airports from various foreign airlines, themselves bigger state-owned or supported players, but few private airlines have succeeded like Norwegian.

Norwegian brought us lower prices, great routes to our favourite destinations and good service. They were the first to introduce fee WiFi into planes and they managed to survive for almost two decades. However, their over optimistic plans to introduce long-haul flights with low prices, where there was already plenty of competition, ended up in high levels of debt and poor profitability. In fact their costs for this expansion started to cause losses and Covid did the rest.

Their own shareholders appeared to run out of cash and the Norwegian government surprisingly refused to save the company since hey no longer had any ownership of SAS. That would have been an interesting move because the government could have got the company back on a path to profitability and save hundreds of skilled jobs. Covid will not last for ever… just months… but Norway is Norway!

Norwegian has now been in administration for months with few customers and with very few flights since few of us travel. They are faced with angry creditors who did know what they were doing – they are all professional creditors. Finnair and SAS are licking their lips that Norwegian will be closed down, but it seems that we may have a restructured Norwegian. That would be very good for us ordinary folk and small exporting companies. We need private airline competition at airports not nationally owned monopolies.

 

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