Mortyman From Norway, joined Aug 2006, 3701 posts, RR: 1 Posted (11 months 3 weeks 4 days 6 hours ago) and read 3798 times:
Media here in Norway and also in Polan is Reporting:
Norwegian considering Polish LOT
Norwegian CEO Bjorn Kjos is in the process of obtaining information about the Polish state airline LOT of possibly place a bid.
Norwegian ceo, Mr Bjørn Kjos was this weekend in Poland where he met the country's Finance Minister in Warsaw, writes the Norwegian Finance paper Dagens Næringsliv. The conversation was according to the newspaper Rzeczpospolita about the privatization of the state airline LOT.
The company is struggling and could probably be sold cheap. Norwegian CEO Bjorn Kjos is interested and, according to the newspaper asked for detailed information about the company before considering a possible bid.
- I can confirm that Bjørn Kjos has been in a meeting with the authorities in Poland. The content of the conversations I can not say anything about, says communications director Anne-Sissel Skånvik in Norwegian.
According to Dagens Næringsliv , the Polish Treasury works to find a buyer for the ailing company. The process also includes a change of ownership law.
- The Prime Minister has prepared a bill that the Polish government may hold under 51 per cent of LOT in the future, and possibly sell out completely. The proposal is being considered by Parliament and can be resolved within a few weeks, says Wojciech Konefal a spokesperson in the Polish Treasury Department.
Translated excerpts from articles in Polish and Norwegian:
Prime From Norway, joined Apr 2013, 6 posts, RR: 0
Reply 1, posted (11 months 3 weeks 3 days 19 hours ago) and read 3309 times:
As i understand, Kjos want's the 8x 787.
How will they organize this if there is a deal? What will they do with the Embraer fleet, will we see Norwegian branded Embraer's? Norwegian is all about keeping things simple with only 737 (787 for longhaul).
Mortyman From Norway, joined Aug 2006, 3701 posts, RR: 1
Reply 3, posted (11 months 3 weeks 3 days 5 hours ago) and read 2858 times:
It would be surprising if Norwegian would venture into a partnership with partly state owned airline. It would be far off from Norwegian's strategy. However, if the article statement is true, that the government of Polen wants to sell out of LOT completly, it might be more interesting for Norwegian. Maybe the Norwegian airline is interested in their longhaul operations / aircraft only ?
WROORD From United States of America, joined Mar 2009, 915 posts, RR: 0
Reply 4, posted (11 months 3 weeks 3 days 3 hours ago) and read 2773 times:
Quoting Mortyman (Reply 3): However, if the article statement is true, that the government of Polen wants to sell out of LOT completly, it might be more interesting for Norwegian. Maybe the Norwegian airline is interested in their longhaul operations / aircraft only ?
The goverbnebt of Poland would not sell LOT to a company interested only in their long-haul operations. Any sale would have to have guarantees of preserving the brand of LOT, its hub in WAW and future growth.
BestWestern From Hong Kong, joined Sep 2000, 6953 posts, RR: 57
Reply 5, posted (11 months 3 weeks 3 days 3 hours ago) and read 2745 times:
Quoting WROORD (Reply 4): The goverbnebt of Poland would not sell LOT to a company interested only in their long-haul operations. Any sale would have to have guarantees of preserving the brand of LOT, its hub in WAW and future growth.
LOT has no future unless it is operated as a commercial entity, rather than a plaything of the Polish government.
Filipair From United States of America, joined May 2010, 74 posts, RR: 0
Reply 6, posted (11 months 3 weeks 1 day 9 hours ago) and read 2294 times:
Quoting BestWestern (Reply 5): LOT has no future unless it is operated as a commercial entity, rather than a plaything of the Polish government.
Completely agreed. This is why, IMHO, selling LO to an airline that has a proven track record of success and a desire to maximize the strategic potential of the WAW hub is the best option. (Restrictive EU ownership guidelines blocked TK from buying LO out. That would have been perfect.)
So at the moment, LOT is a huge liability. The many recent CEO's have all had "restructuring" as their main action point, with very mixed results. Most recent talks (link in Polish only, sorry) center on LOT moving more heavily towards the LCC model (i.e. replacing E-jets with 737NG's, unbundling fees, etc). This contrasts with the airline's current strategy to market itself as a boutique Central European connecting hub (787 this summer, premium on ticket prices and the like).
All of this begs the question: what is LOT's future role in the European aviation market? I think addressing the problem from this perspective helps-
- WAW's position as a potential connecting hub between Eastern Europe/Central Asia and Western Europe/North America
- Strong and rapidly growing domestic air travel market
- Low labor costs
- 8 787's on order
- Largest share of Polish air travel market (29% and relatively steady)
- Lack of clear strategy and leadership within the airline (here the "government plaything" dynamic comes into play)
- Several years of unprofitable operations have forced the government to offer rescue loans
- The jury is still out whether there is enough local demand for flights east from Warsaw
- Generally weak premium demand in Poland
So is being absorbed by an airline like DY, a low cost carrier with longhaul ambitions, the answer?