Denmark

Norwegian's orders make it a candidate for first LCC to join a global alliance - or a Gulf carrier

In a distorted and fast changing airline world where partnerships and mergers are key to future survival, Nordic LCC, Norwegian is fast making itself one of the most attractive unattached propositions in the market.

Norwegian’s steady move towards becoming a long-haul Boeing 787 operator, alongside a growing European short-haul distribution system, promises to make it a serious low-cost network airline. The carrier’s recent deal to lock in access to a large fleet of 222 fuel-efficient short-haul aircraft over the second half of the decade (and at opportunistic prices) will transform a successful local LCC into a global force.

The order announcement therefore does a lot more than promise a bigger airline. Its potentially strong position now propels it into a new sphere where it becomes a candidate to be the first LCC member of one of the big three global alliances – until now the exclusive realm of legacy network airlines.

Airlines in transition: Hybrid and low-cost carriers push for better airline-airport relationships

Alex Cruz, CEO of Spanish LCC Vueling, spoke passionately at a recent conference of his need to see partnerships between airports and airlines that are deep and long-lasting. Mr Cruz referred specifically to co-operation that permits both partners to benefit from alternative revenue generation. Ahead of the forthcoming CAPA Airlines in Transition conference in Istanbul – which will feature some 30 airline CEOs addressing this and related issues – we consider how these parties have collaborated in the past and how it is shaping up now.

Vueling Airlines has become one of the innovators of the hybrid/low-cost business model that has become more prevalent and is found in other airlines such as easyJet (progressively) and Flybe (one of the originators of the model).

The fast changing airline industry makes life difficult for airport planners – just as change also offers opportunities.

Vueling grows its low cost Barcelona hub role as Iberia Express focusses on Madrid premium traffic

Vueling's growth this year, the largest since its merger with rival Clickair in 2009, underscores the airline's role as a cost-effective hub carrier with connecting flights at Barcelona's El Prat Airport, a status Iberia concluded it could not achieve in Barcelona, largely pulling out of the market in favour of specially-formed LCC Clickair. After the Clickair-Vueling merger, Iberia retained part ownership (46%, now controlled by Iberia parent International Consolidated Airline Group) while the merged carrier continued its focus on Barcelona. The partnership appears to be working well for both Iberia and Vueling.

That focus has been re-affirmed by the airline's intention to grow summer destinations served from El Prat by a further 10, bringing the total to 70, 23 more than served last year, and representing a 17% seat increase at El Prat. The growth is supported by the addition of four A320s and a single A319.

Blue1 to become feeder for SAS' Copenhagen and Stockholm hubs in move against Finnair and Norwegian

SAS subsidiary Blue1 will undergo network changes that will see it drop its non-Scandianvan European routes in order to bolster services from secondary Finnish cities.

This will allow the SAS group to build greater feed into its Copenhagen Kastrup and Stockholm Arlanda hubs, a competitive move against Finnair and its Helsinki hub, as well as LCC Norwegian Air Shuttle and its Scandinavian hubs.

This development is only the first in what will be a number of changes across the group’s carriers up to 2015 under the new strategy as SAS seeks to become a more formidable force. Meanwhile low-cost carrier Norwegian Air Services continues to grow and threaten SAS’ dominance in the Nordic market.

Norwegian Air Shuttle reports its strongest quarterly result with bigger target on corporate sector

Norwegian Air Shuttle reported a strong third quarter (three months to 30-Sep-2011) result, bolstered by strong gains in revenue, passenger numbers and careful cost control. The result for the third quarter, seasonally the carrier’s strongest, was Norwegian’s strongest ever quarterly result as the LCC continues to expand at breakneck pace in the Northern Europe region in which it now claims bases in all four major Nordic markets. The carrier is targeting a greater share of the corporate sector but will soon have to defend itself from full-service competitor SAS, who it has taken market share from.

Norwegian, the first European carrier of the third-quarter reporting season reported a stellar result amid a concerning quarter for the continent's airlines, which was characterised by downward revisions to earnings by many major carriers, although LCCs are faring much better.