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DUSZRH
Posts: 222
Joined: Thu Jan 05, 2017 12:17 am

Re: DY about to go bust?

Tue Mar 03, 2020 5:15 pm

Bongodog49 wrote:

I don't doubt your general analysis, but Norwegian were only sitting on free cash of around 1 months turnover at Jan 1st. In the worst quarter of the year anyway they would have expected to be in red ink territory until Easter under the best of circumstances, and with the measures already put in place move into the black for the rest of the year. With the market turning against them I very much doubt they can reach Easter without new funds. A rights issue will produce only a fraction of the last ones due to the collapse in the share price, and they now have next to no collateral for any new loans.


You might incur losses in Q1, but it should be cash positive, as people start buying flights for Q2/Q3. That’s why most airlines fail in Q3/4 as that’s when you start financing the winter losses. (New bookings drop, but you pay for all the stuff, especially in Q3).
 
Bongodog49
Posts: 182
Joined: Fri Feb 08, 2019 11:35 am

Re: DY about to go bust?

Tue Mar 03, 2020 6:57 pm

DUSZRH wrote:
Bongodog49 wrote:

I don't doubt your general analysis, but Norwegian were only sitting on free cash of around 1 months turnover at Jan 1st. In the worst quarter of the year anyway they would have expected to be in red ink territory until Easter under the best of circumstances, and with the measures already put in place move into the black for the rest of the year. With the market turning against them I very much doubt they can reach Easter without new funds. A rights issue will produce only a fraction of the last ones due to the collapse in the share price, and they now have next to no collateral for any new loans.


You might incur losses in Q1, but it should be cash positive, as people start buying flights for Q2/Q3. That’s why most airlines fail in Q3/4 as that’s when you start financing the winter losses. (New bookings drop, but you pay for all the stuff, especially in Q3).


The problem for Norwegian is that the credit card companies who are liable if you pay by card and the airline goes under, typically start to withhold funds until the flights have taken place.
 
eamondzhang
Posts: 1831
Joined: Thu Sep 23, 2010 8:23 am

Re: DY about to go bust?

Wed Mar 04, 2020 2:26 am

jfk777 wrote:
a few ANA 787-8 could be available soon too.

A bit OT but AFAIK ANA did not have any plans to retire any 787 anytime soon. Please enlighten us with more details.

Michael
 
BealineV953
Posts: 204
Joined: Fri Jul 26, 2019 10:00 am

Re: DY about to go bust?

Thu Mar 05, 2020 12:11 pm

A successful business will be good for customers, employees and investors. A successful business is likely to be profitable. The profit is used to invest in new assets, new products and to pay dividends.

Customers will like the product and regard it as being good value for money. Satisfied customers will keep coming back.

Employees see the business as being a good employer. They will be motivated to play their part in delivering a good product. A successful business offers job security, and its employees are likely to stay with the company.

Shareholders see a return on their investment, earning dividends and seeing the value of their shares grow.

A business that is unprofitable over a sustained period fails those tests. Ongoing losses limit the company’s ability to invest in renewing its assets and in new products. It does not offer job security. It is harder to attract investment in the business.

Norwegian did not bring anything new to the intra-Europe ‘low cost’ market; Ryanair and easyJet blazed that trail.

Norwegian did bring ‘unbundled’ pricing to the longhaul market. Norwegian’s lead in fares are low, but include only a bag that’ll fit under a seat.

In longhaul markets, to compete with Norwegian, other carriers have in general aimed to maintain their margins by reducing costs. We’ve seen BA reduce cost per seat by going to 10 abreast on the 777, IAG create Level and Eurowings replace airlines in the Lufthansa group on some services.

If I had a £1 for each time I’ve seen an a.netter complain about those approaches I’d never have to fly in Economy. Be careful what you wish for.

Whether Norwegian offers customers value for money can be debated (see earlier posts).

Whether Norwegian is a good employer can be debated (again see earlier posts).

What can be said is that Norwegian is not profitable. See the financial results for 2019:

https://media.uk.norwegian.com/document ... 9-q4-93741

The report says that in 2019 Norwegian shifted its focus from growth to profitability, and that it reduced costs significantly. However, it still did not make a profit.

For 2019 Norwegian made a loss of NOK1,609. This followed a loss of NOK1,454 in 2018.

Competition is ‘fair’ when you sell a good product at a profit. In Europe easyJet and Ryanair show that it is possible to be ‘low cost’ and make a healthy profit.

Short term, Norwegian may offer low prices and that may seem like a wonderful thing. Who wouldn’t pay £19 to fly on Norwegian when easyJet want £29? Hey, you’ll have saved enough for one cappucino and a sticky bun in the airport departure lounge.

However, a struggling business may weaken its competitors. Where a company sells below cost, it forces its competitors to sell at sub-optimal prices, reducing their profitability and so their ability to invest in their own future.

Where a business takes money from shareholders telling them that it will be used to invest in making the company profitable, but then effectively squanders the money on subsidising below cost prices, and damages other business in the process, is that ‘fair’ competition?

Norwegian’s below cost pricing may lead to a reduction in competition. Rational carriers will be unwilling to keep making a loss, and may pull out of markets. Norwegian’s actions may even put other airlines out of business. To be clear, I very much doubt that Norwegian can seriously damage easyJet, Ryanair or any of the carriers in the IAG, AF/KL or Lufthansa groups. However, they may push struggling carriers over the edge. If that happens, is it really good for competition?


PS

On longhaul routes, Norwegian’s ‘Lowfare’ prices allow only a bag that’ll fit under a seat. All other extras have to be paid for.

However, if you can’t fit a change of clothes into a bag that’ll fit under a seat, then you may want to trade up to the significantly more expensive ‘Lowfare+’.

You can work out whether paying the ‘Lowfare’ price and adding a separate charge for a piece of baggage that’ll fit in the overhead paid for is better value for you than the ‘Lowfare+’ with baggage included. To do this you’ll need to navigate a table of baggage charges: “Baggage rates will vary depending on your itinerary. Use our city pair list to establish the applicable zone (e.g. A, B, C etc.) and calculate the charges that will apply”.
Give it a go; you’ll need a lot of time, but it’s way more fun that Suduko.
Ever since childhood, when I lived within sight of London Airport, I have seldom seen a plane go by and not wished I was on it.”
With apologies to Paul Theroux - ‘The Great Railway Bazaar’
 
tobsw
Posts: 139
Joined: Mon Jul 11, 2011 2:29 pm

Re: DY about to go bust?

Thu Mar 05, 2020 1:24 pm

^^ Would you please edit your comment? I find it really difficult to follow AND I cannot take any message you are trying to pass. TA
 
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enilria
Posts: 10274
Joined: Fri Feb 22, 2008 7:15 pm

Re: DY about to go bust?

Thu Mar 05, 2020 2:12 pm

mcg wrote:
FWIW I live in Denver and what I observe is that people talk about DY's low fares then always end up flying on some other airline. Sometimes the schedule doesn't work or 'it's not that much more' to use LH or BA or UA or 'I want to use (or earn) miles'. That's DY's problem, their fares don't seem to buy much in the marketplace.

This is why we can't have nice things
 
MIflyer12
Posts: 8270
Joined: Mon Feb 18, 2013 11:58 pm

Re: DY about to go bust?

Thu Mar 05, 2020 2:26 pm

enilria wrote:
mcg wrote:
FWIW I live in Denver and what I observe is that people talk about DY's low fares then always end up flying on some other airline. Sometimes the schedule doesn't work or 'it's not that much more' to use LH or BA or UA or 'I want to use (or earn) miles'. That's DY's problem, their fares don't seem to buy much in the marketplace.

This is why we can't have nice things


That's one way to look at it. Another way is that DY didn't offer these prospective DEN customers enough value to break their loyalty to other carriers. Every new entrant to an established market faces that. I buy Heinz ketchup. Price of the store brand is of no interest to me - I don't use enough to make ketchup expenses a factor in my household budget. Do I want to risk messing up my European vacation with a new carrier? Will they be financially stable? Do they have spare aircraft? Will I get Sun Country-d? Can they interline me if things go wrong? Have they scheduled enough frequencies so I won't be waiting three days for the next flight?

Nobody said being a new international carrier to the U.S. long-haul market would be easy.
 
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enilria
Posts: 10274
Joined: Fri Feb 22, 2008 7:15 pm

Re: DY about to go bust?

Thu Mar 05, 2020 2:30 pm

I think there is a fundamental misunderstanding of market dynamics involved in this post, or a purposeful bias toward ignoring them?
BealineV953 wrote:
In longhaul markets, to compete with Norwegian, other carriers have in general aimed to maintain their margins by reducing costs. We’ve seen BA reduce cost per seat by going to 10 abreast on the 777, IAG create Level and Eurowings replace airlines in the Lufthansa group on some services.

You clearly are aware that other carriers added routes on top of Norwegian (I'm looking at you IAG/DLH) to suffocate Norwegian.
BealineV953 wrote:
What can be said is that Norwegian is not profitable. See the financial results for 2019:

How can you make money when IAG adds flights on top of you on LGW-FLL/OAK that frankly make ZERO business sense for IAG other than to kill Norwegian? IAG even explicitly tried to buy Norwegian to shut them down. I mean, do they have to take out billboards saying "WE WANT TO KILL NORWEGIAN" for some people to get that clearly?
BealineV953 wrote:
Competition is ‘fair’ when you sell a good product at a profit.

Do you think for a hot second that Level or Eurowings is profitable? LH has already reshuffled Eurowings like 5 times (and said it is not doing well repeatedly) and Level definitely does worse than Norwegian does. Look at the publicly available data on LF and fare. And the costs are only lower in terms of more dense seating. All the other costs are comparable. The economics for IAG on Level are this, and Eurowings is similar.
Option 1
1) Forego $X in profits per year competing with Norwegian forever (and they will grow making X bigger each year)
2) Lose 5X per year for a few years making sure they die, then shut down Level and raise prices back where they were or even higher to make up the loss
BealineV953 wrote:
However, a struggling business may weaken its competitors. Where a company sells below cost, it forces its competitors to sell at sub-optimal prices, reducing their profitability and so their ability to invest in their own future

Completely agree, except it's not Norwegian that is irrational competitor, it is IAG using cross-subsidization and predatory competitive tactics to foist their money losing business into markets designed to hurt Norwegian.

Here's the loads on LGW-OAK, you tell me who the struggling, money losing irrational competitor is...
Apr 2017 Norwegian 84% LF, Level 66% LF
May 2017 Norwegian 90% LF, Level 55% LF
Jun 2017 Norwegian 95% LF, Level 78% LF
Jul 2017 Norwegian 96% LF, Level 73% LF
Aug 2017 Norwegian 95% LF, Level 68% LF
Sep 2017 Norwegian 95% LF, Level 71% LF
Oct 2017 Norwegian 93% LF, Level 60% LF
Nov 2017 Norwegian 91% LF, Level 41% LF
Dec 2017 Norwegian 91% LF, Level 51% LF
Jan 2018 Norwegian 87% LF, Level 39% LF
Feb 2018 Norwegian 88% LF, Level 26% LF
Mar 2018 Norwegian 92% LF, Level 47% LF
Apr 2018 Norwegian 76% LF, Level 53% LF
May 2018 Norwegian 81% LF, Level 60% LF
Jun 2018 Norwegian 91% LF, Level 86% LF
Jul 2018 Norwegian 89% LF, Level 82% LF
Aug 2018 Norwegian 90% LF, Level 81% LF
Sep 2018 Norwegian 89% LF, Level 63% LF
Oct 2018 Norwegian 82% LF, Level 47% LF
 
tobsw
Posts: 139
Joined: Mon Jul 11, 2011 2:29 pm

Re: DY about to go bust?

Thu Mar 05, 2020 3:05 pm

LEVEL did not and does not fly LGW-OAK. Some neuronal short circuit there.
 
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enilria
Posts: 10274
Joined: Fri Feb 22, 2008 7:15 pm

Re: DY about to go bust?

Thu Mar 05, 2020 3:09 pm

MIflyer12 wrote:
enilria wrote:
mcg wrote:
FWIW I live in Denver and what I observe is that people talk about DY's low fares then always end up flying on some other airline. Sometimes the schedule doesn't work or 'it's not that much more' to use LH or BA or UA or 'I want to use (or earn) miles'. That's DY's problem, their fares don't seem to buy much in the marketplace.

This is why we can't have nice things


That's one way to look at it. Another way is that DY didn't offer these prospective DEN customers enough value to break their loyalty to other carriers. Every new entrant to an established market faces that. I buy Heinz ketchup. Price of the store brand is of no interest to me - I don't use enough to make ketchup expenses a factor in my household budget. Do I want to risk messing up my European vacation with a new carrier? Will they be financially stable? Do they have spare aircraft? Will I get Sun Country-d? Can they interline me if things go wrong? Have they scheduled enough frequencies so I won't be waiting three days for the next flight?

Nobody said being a new international carrier to the U.S. long-haul market would be easy.

Another way to look at it, is that UA won't allow the "value" differential to get large enough to break their loyalty. UA will make sure they are close enough to their fare to prevent that. This is how you drive out competition and jack up fares afterward to teach customers a lessen for their lack of loyalty and make back the cost of driving them out. The irony is that consumers will pay for the cost of driving out the competitor that tried to offer them lower fares. Thus, why we can't have nice things.
 
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enilria
Posts: 10274
Joined: Fri Feb 22, 2008 7:15 pm

Re: DY about to go bust?

Thu Mar 05, 2020 3:09 pm

tobsw wrote:
LEVEL did not and does not fly LGW-OAK. Some neuronal short circuit there.

IAG/BA/Level. Whatever. Same thing. The Level brand even used the BA IATA code for part of its history so the line is a thin one.
 
tobsw
Posts: 139
Joined: Mon Jul 11, 2011 2:29 pm

Re: DY about to go bust?

Thu Mar 05, 2020 3:38 pm

enilria wrote:
tobsw wrote:
LEVEL did not and does not fly LGW-OAK. Some neuronal short circuit there.

IAG/BA/Level. Whatever. Same thing. The Level brand even used the BA IATA code for part of its history so the line is a thin one.


No. That's not correct, unless you can prove otherwise.

LEVEL Spain has always used IB.

LEVEL France has used OS and LV IATA code.

If you want you can do a like for like analysis in the markets were Norwegian and LEVEL coexists, aka BCN.
 
716131
Posts: 892
Joined: Thu Mar 16, 2017 11:51 am

Re: DY about to go bust?

Thu Mar 05, 2020 3:46 pm

At the end of March, DY is also cutting it's MAD last long haul routes and will fly OSL-MAD route only.
If it's not Boeing, I'm not going!
 
tobsw
Posts: 139
Joined: Mon Jul 11, 2011 2:29 pm

Re: DY about to go bust?

Thu Mar 05, 2020 4:05 pm

SQ789 wrote:
At the end of March, DY is also cutting it's MAD last long haul routes and will fly OSL-MAD route only.


They are flying MAD-LAX over de summer 20 and winter 20/21 seasons. They are stopping MAD-JFK with the start of 20 summer season.
 
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enilria
Posts: 10274
Joined: Fri Feb 22, 2008 7:15 pm

Re: DY about to go bust?

Thu Mar 05, 2020 4:08 pm

tobsw wrote:
enilria wrote:
tobsw wrote:
LEVEL did not and does not fly LGW-OAK. Some neuronal short circuit there.

IAG/BA/Level. Whatever. Same thing. The Level brand even used the BA IATA code for part of its history so the line is a thin one.


No. That's not correct, unless you can prove otherwise.

LEVEL Spain has always used IB.

LEVEL France has used OS and LV IATA code.

If you want you can do a like for like analysis in the markets were Norwegian and LEVEL coexists, aka BCN.

The point is the same whether it is BA or Level. They are both units of IAG. It's irrelevant what the paint scheme was. The point is the same.
 
tobsw
Posts: 139
Joined: Mon Jul 11, 2011 2:29 pm

Re: DY about to go bust?

Thu Mar 05, 2020 4:23 pm

enilria wrote:
The point is the same whether it is BA or Level. They are both units of IAG. It's irrelevant what the paint scheme was. The point is the same.


It's importante to get facts right. The service BA provided on the LGW-OAK was far away from the service DY or Level offers. BA LGW-OAK was a BA flights, oneworld member (with all the elite and miles perks), full service carrier (free food, bar and IFE...).

Anyway, we know that BA LGW-OAK flight did not perform well. LHR - SFO was a better choice for consumers when flying BA (and price was not that much different). So as a customer, I rather fly into SFO than OAK. Interestingly, Norwegian followed the same path, it moved its flights from OAK to SFO.

I invite you to make a London - SFO comparison for that matter.

Regardless...

DY has been (and is) a player that revolutionised TA travel. All traditional airlines have adjusted their product (albeit only removed free check-in luggage). Fares have never been so low as they are ATM. I'm very happy with the presence of Norwegian. I'll be sad and disappointed if they ever disappear.
 
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enilria
Posts: 10274
Joined: Fri Feb 22, 2008 7:15 pm

Re: DY about to go bust?

Thu Mar 05, 2020 4:30 pm

tobsw wrote:
enilria wrote:
The point is the same whether it is BA or Level. They are both units of IAG. It's irrelevant what the paint scheme was. The point is the same.


It's importante to get facts right. The service BA provided on the LGW-OAK was far away from the service DY or Level offers. BA LGW-OAK was a BA flights, oneworld member (with all the elite and miles perks), full service carrier (free food, bar and IFE...).

Anyway, we know that BA LGW-OAK flight did not perform well. LHR - SFO was a better choice for consumers when flying BA (and price was not that much different). So as a customer, I rather fly into SFO than OAK. Interestingly, Norwegian followed the same path, it moved its flights from OAK to SFO.

I invite you to make a London - SFO comparison for that matter.

Regardless...

DY has been (and is) a player that revolutionised TA travel. All traditional airlines have adjusted their product (albeit only removed free check-in luggage). Fares have never been so low as they are ATM. I'm very happy with the presence of Norwegian. I'll be sad and disappointed if they ever disappear.

Since we are getting facts straight. I don't see any flights from SFO to LGW on any IAG carrier, so how I am I supposed to do the comparison you have requested for me to do?
 
IADCA
Posts: 2191
Joined: Mon Feb 26, 2007 12:24 am

Re: DY about to go bust?

Thu Mar 05, 2020 4:36 pm

enilria wrote:
tobsw wrote:
enilria wrote:
IAG/BA/Level. Whatever. Same thing. The Level brand even used the BA IATA code for part of its history so the line is a thin one.


No. That's not correct, unless you can prove otherwise.

LEVEL Spain has always used IB.

LEVEL France has used OS and LV IATA code.

If you want you can do a like for like analysis in the markets were Norwegian and LEVEL coexists, aka BCN.

The point is the same whether it is BA or Level. They are both units of IAG. It's irrelevant what the paint scheme was. The point is the same.


The problem is that posting just load factors, while suggestive of a point, doesn't prove the point in either direction given the potential difference in average fare. That problem is much more likely to exist if it's BA-branded service.
 
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eta unknown
Posts: 2858
Joined: Wed Jun 13, 2001 5:03 am

Re: DY about to go bust?

Thu Mar 05, 2020 4:36 pm

tobsw wrote:
DY has been (and is) a player that revolutionised TA travel. All traditional airlines have adjusted their product (albeit only removed free check-in luggage). Fares have never been so low as they are ATM. I'm very happy with the presence of Norwegian. I'll be sad and disappointed if they ever disappear.


DY most certainly is not a revolutionary TA player: those honours belong to Icelandair and Laker.
 
tobsw
Posts: 139
Joined: Mon Jul 11, 2011 2:29 pm

Re: DY about to go bust?

Thu Mar 05, 2020 4:44 pm

enilria wrote:
Since we are getting facts straight. I don't see any flights from SFO to LGW on any IAG carrier, so how I am I supposed to do the comparison you have requested for me to do?


LGW-SFO vs LHR-SFO

But if you really want to do direct comparisons, check LEVEL vs Norwegian to/from Barcelona.

You will be surprised how similar the LF are. Usually LEVEL outperforms Norwegian. Usually.
 
AF022
Posts: 1860
Joined: Fri Dec 26, 2003 10:41 pm

Re: DY about to go bust?

Thu Mar 05, 2020 4:46 pm

Stock down another 13% today, down to NOK 15.85, a new 52-week low.
 
WaywardMemphian
Posts: 1501
Joined: Sat Dec 13, 2014 9:05 pm

Re: DY about to go bust?

Thu Mar 05, 2020 4:46 pm

tobsw wrote:
enilria wrote:
The point is the same whether it is BA or Level. They are both units of IAG. It's irrelevant what the paint scheme was. The point is the same.


It's importante to get facts right. The service BA provided on the LGW-OAK was far away from the service DY or Level offers. BA LGW-OAK was a BA flights, oneworld member (with all the elite and miles perks), full service carrier (free food, bar and IFE...).

Anyway, we know that BA LGW-OAK flight did not perform well. LHR - SFO was a better choice for consumers when flying BA (and price was not that much different). So as a customer, I rather fly into SFO than OAK. Interestingly, Norwegian followed the same path, it moved its flights from OAK to SFO.

I invite you to make a London - SFO comparison for that matter.

Regardless...

DY has been (and is) a player that revolutionised TA travel. All traditional airlines have adjusted their product (albeit only removed free check-in luggage). Fares have never been so low as they are ATM. I'm very happy with the presence of Norwegian. I'll be sad and disappointed if they ever disappear.


Now we are getting even smaller, more efficient planes to carry on new TATL experiments than the 787. Look at Neeleman and Breeze's supposedly long range 4000nm A223 and the 321XLRs coming for JetBlue. Norwegian and the Legacies will get pressured from this side of the pond should they make it another year.
 
MCTSET
Posts: 197
Joined: Wed Jan 02, 2019 8:45 pm

Re: DY about to go bust?

Thu Mar 05, 2020 5:23 pm

are DY in an immediate liquidity crisis right now?
 
Wf789
Posts: 16
Joined: Sun Sep 25, 2016 11:51 pm

Re: DY about to go bust?

Thu Mar 05, 2020 7:42 pm

AF022 wrote:
Stock down another 13% today, down to NOK 15.85, a new 52-week low.


Lowest value since the financial crisis.
 
mattyfitzg
Posts: 263
Joined: Sun Sep 04, 2016 4:50 pm

Re: DY about to go bust?

Thu Mar 05, 2020 11:20 pm

eta unknown wrote:
DY most certainly is not a revolutionary TA player: those honours belong to Icelandair and Laker.


Think Primera should get a mention in that too, being the first with the NEOs over the pond, almost a Laker mk2
 
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DeltaMD90
Posts: 8928
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Re: DY about to go bust?

Fri Mar 06, 2020 12:49 am

tobsw wrote:
Regardless...

DY has been (and is) a player that revolutionised TA travel. All traditional airlines have adjusted their product (albeit only removed free check-in luggage). Fares have never been so low as they are ATM. I'm very happy with the presence of Norwegian. I'll be sad and disappointed if they ever disappear.

I wouldn't call them revolutionary, they're losing a ton of money and may be on the verge of collapse. Anyone can be disruptive in an industry while losing a lot of money.

If DY was able to cause real change for the long-term and actually make money, that'd be revolutionary IMO.

Low fares are nice, but if those fares are unsustainable, they'll always be temporary
 
Bostrom
Posts: 1002
Joined: Tue Feb 02, 2016 7:11 pm

Re: DY about to go bust?

Fri Mar 06, 2020 8:49 am

They have withdrawn their financial guidance and will not be able to reach their goals for 2020. https://www.bloomberg.com/news/articles ... oronavirus
 
olle
Posts: 2365
Joined: Tue Feb 06, 2007 3:38 am

Re: DY about to go bust?

Fri Mar 06, 2020 9:05 am

DY should get rid of WB 787 and use its 320 order to get 321xlr....
 
factsonly
Posts: 2980
Joined: Mon Aug 06, 2012 3:08 pm

Re: DY about to go bust?

Fri Mar 06, 2020 9:18 am

Norwegian cancels 22 long-haul 'flights' between Europe - USA from March 22 - May 5, 2020.

Reports Traffic February 2020:

- ASK (million) 5,528 vs 7,048 -22 %
- RPK (million) 4,516 vs 5,743 -21 %
- Load factor 81.7% vs 81.5% +0.2 p.p.
- Passengers 1,955,585 vs 2,517,335 -22 %

Full 12 months:

- ASK (million) 96,141 vs 101,883 -6 %
- RPK (million) 83,865 vs 86,648 -3 %
- Load factor 87.2% vs 85.0% +2.2 p.p.
- Passengers 34,969,368 vs 37,836,489 -8 %

https://media.uk.norwegian.com/document ... 2020-94425
 
Bongodog49
Posts: 182
Joined: Fri Feb 08, 2019 11:35 am

Re: DY about to go bust?

Fri Mar 06, 2020 9:31 am

Wf789 wrote:
AF022 wrote:
Stock down another 13% today, down to NOK 15.85, a new 52-week low.


Lowest value since the financial crisis.


Now down to 12.77, the quoted February figures were down around 20% on most factors, and we need to bear in mind that Norwegian primarily works in Europe and North America, coronavirus only really became a major issue in these markets towards the end of the month. Any airline that was in the red last year will be at risk now
 
davidjohnson6
Posts: 896
Joined: Mon Jun 20, 2016 10:10 pm

Re: DY about to go bust?

Fri Mar 06, 2020 10:05 am

Share price has now gone below 12 NOK - it is down 25% since last night.
 
pdp
Posts: 245
Joined: Thu Dec 14, 2017 7:14 pm

Re: DY about to go bust?

Fri Mar 06, 2020 10:25 am

davidjohnson6 wrote:
Share price has now gone below 12 NOK - it is down 25% since last night.


To be fair, most share prices are down across the board!
 
davidjohnson6
Posts: 896
Joined: Mon Jun 20, 2016 10:10 pm

Re: DY about to go bust?

Fri Mar 06, 2020 10:29 am

A company's share price falling 70 % in just 2 weeks is most certainly not normal. If there were plans a month ago to raise fresh equity, those plans have become much much harder
 
alm1
Posts: 75
Joined: Wed Oct 29, 2008 9:54 pm

Re: DY about to go bust?

Fri Mar 06, 2020 10:32 am

Soon their market cap will be less than Lauda losses for last year and Ryanair still has some cash around.
 
royroy
Posts: 53
Joined: Mon Nov 13, 2017 11:48 am

Re: DY about to go bust?

Fri Mar 06, 2020 10:42 am

now 28% down today already. this is worrying
 
N1KE
Posts: 26
Joined: Thu Mar 22, 2007 7:47 pm

Re: DY about to go bust?

Fri Mar 06, 2020 10:58 am

Share price dropping fast this morning. Seems to be a very fast slide. Only so many times they can beg for cash and get it. Could be a bargain for someone to acquire. Time shall tell us but not looking good. Hopefully all will be well for the people employed, as they are the ones that suffer.
 
AF022
Posts: 1860
Joined: Fri Dec 26, 2003 10:41 pm

Re: DY about to go bust?

Fri Mar 06, 2020 11:25 am

factsonly wrote:
Norwegian cancels 22 long-haul 'flights' between Europe - USA from March 22 - May 5, 2020.

Reports Traffic February 2020:

- ASK (million) 5,528 vs 7,048 -22 %
- RPK (million) 4,516 vs 5,743 -21 %
- Load factor 81.7% vs 81.5% +0.2 p.p.
- Passengers 1,955,585 vs 2,517,335 -22 %

Full 12 months:

- ASK (million) 96,141 vs 101,883 -6 %
- RPK (million) 83,865 vs 86,648 -3 %
- Load factor 87.2% vs 85.0% +2.2 p.p.
- Passengers 34,969,368 vs 37,836,489 -8 %

https://media.uk.norwegian.com/document ... 2020-94425


I quickly scanned that link but didn't see anything about which routes are being cut. Do you have any specifics?
 
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VS4ever
Posts: 2573
Joined: Sun Jun 13, 2004 10:03 am

Re: DY about to go bust?

Fri Mar 06, 2020 11:35 am

AF022 wrote:
factsonly wrote:
Norwegian cancels 22 long-haul 'flights' between Europe - USA from March 22 - May 5, 2020.

Reports Traffic February 2020:

- ASK (million) 5,528 vs 7,048 -22 %
- RPK (million) 4,516 vs 5,743 -21 %
- Load factor 81.7% vs 81.5% +0.2 p.p.
- Passengers 1,955,585 vs 2,517,335 -22 %

Full 12 months:

- ASK (million) 96,141 vs 101,883 -6 %
- RPK (million) 83,865 vs 86,648 -3 %
- Load factor 87.2% vs 85.0% +2.2 p.p.
- Passengers 34,969,368 vs 37,836,489 -8 %

https://media.uk.norwegian.com/document ... 2020-94425


I quickly scanned that link but didn't see anything about which routes are being cut. Do you have any specifics?


Here you go:

The following routes are affected: Rome – Los Angeles; Rome – Boston; Rome – New York (reduced number of departures during selected weeks on all these routes) and London – New York (three daily departures are reduced to two on some days).

Source: https://media.uk.norwegian.com/pressrel ... ry-2979040
That feeling when you sit at the end of a runway, brakes are released and the raw power takes over. Now that is a thing of beauty and it never gets old.
 
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AAR
Posts: 56
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Re: DY about to go bust?

Fri Mar 06, 2020 11:46 am

Norwegian Air Shuttle - down seriously today on the Oslo Stock Exchance... app 25 % See link https://classic.nordnet.dk/mux/web/mark ... arketid=15
 
ltbewr
Posts: 15274
Joined: Thu Jan 29, 2004 1:24 pm

Re: DY about to go bust?

Fri Mar 06, 2020 11:50 am

We just saw the shutdown of FlyBe, Norwegian may be next given the combination of the collapse of their stock value, the sudden, massive drop off in bookings from the Coronavirus, retraction from many markets, their problems from the 787 engines and grounding of their 737's. They are in a death spiral and I don't see any way to recover short-term and with a likely worldwide economic recession to take hold. Yes, many of us will miss the idea of cheap fares but they are not sustainable with rare exceptions as the 100's of dead low fare airlines in the past have proven.
 
BrianDromey
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Joined: Sun Dec 10, 2006 2:23 am

Re: DY about to go bust?

Fri Mar 06, 2020 12:18 pm

tobsw wrote:
enilria wrote:
tobsw wrote:
LEVEL did not and does not fly LGW-OAK. Some neuronal short circuit there.

IAG/BA/Level. Whatever. Same thing. The Level brand even used the BA IATA code for part of its history so the line is a thin one.


No. That's not correct, unless you can prove otherwise.

LEVEL Spain has always used IB.

LEVEL France has used OS and LV IATA code.

If you want you can do a like for like analysis in the markets were Norwegian and LEVEL coexists, aka BCN.


LEVEL France has never used the OS IATA code. OS belongs to Austrian. They did use the EC code, however. When IAG decided to repurpose BA Openskies as LEVEL they assumed the LV code. I don't think its fair to compare BA Openskies with LEVEL France, Openskies was a full service airline competing for AF passengers, LEVEL is advertised as a low-cost airline, offering only premium economy and economy. Clearly they have different target markets.

Interestingly I see that LEVEL Europe has now got the VK code, but remains a subsidiary of Vueling. All of the EU3 seem to have messy visions for their low-cost divisions, Vueling/LEVEL, Eurowings and Transavia. clearly they are reacting to different threats.
 
uta999
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Re: DY about to go bust?

Fri Mar 06, 2020 12:30 pm

I wonder if credit card companies are holding onto their money yet. That will be the sign of things to come for DY.
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Bongodog49
Posts: 182
Joined: Fri Feb 08, 2019 11:35 am

Re: DY about to go bust?

Fri Mar 06, 2020 1:08 pm

uta999 wrote:
I wonder if credit card companies are holding onto their money yet. That will be the sign of things to come for DY.


If they aren't I would be very surprised.
 
Wf789
Posts: 16
Joined: Sun Sep 25, 2016 11:51 pm

Re: DY about to go bust?

Fri Mar 06, 2020 1:09 pm

uta999 wrote:
I wonder if credit card companies are holding onto their money yet. That will be the sign of things to come for DY.

Thwy have done that for a long time.
Few weeks ago Norwegian began to offer 4% extra cashpoints if you pay your ticket via bank transfer.
 
tobsw
Posts: 139
Joined: Mon Jul 11, 2011 2:29 pm

Re: DY about to go bust?

Fri Mar 06, 2020 1:23 pm

BrianDromey wrote:
LEVEL France has never used the OS IATA code. OS belongs to Austrian. They did use the EC code, however. When IAG decided to repurpose BA Openskies as LEVEL they assumed the LV code. I don't think its fair to compare BA Openskies with LEVEL France, Openskies was a full service airline competing for AF passengers, LEVEL is advertised as a low-cost airline, offering only premium economy and economy. Clearly they have different target markets.

Interestingly I see that LEVEL Europe has now got the VK code, but remains a subsidiary of Vueling. All of the EU3 seem to have messy visions for their low-cost divisions, Vueling/LEVEL, Eurowings and Transavia. clearly they are reacting to different threats.


Sorry, you are right. I knew they used a different code before LV - but I just got the letters wrong (indeed, OS is Austrian).

OpenSkies and LEVEL is a very interesting transition: from an all business operator, then business + economy premium, and finally (LEVEL) premium economy+ unbundled economy fares.

But let's go back to Norwegian.
 
CALMSP
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Re: DY about to go bust?

Fri Mar 06, 2020 2:21 pm

no change in DEN-FCO? That's surprising.
 
LHUSA
Posts: 829
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Re: DY about to go bust?

Fri Mar 06, 2020 2:33 pm

CALMSP wrote:
no change in DEN-FCO? That's surprising.


Yeah, still available on their website. You can purchase DEN-FCO for $189 in less than a month, ouch. I feel as though their cuts were not deep enough, perhaps they will expand them shortly.
 
marosbts
Posts: 128
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Re: DY about to go bust?

Fri Mar 06, 2020 4:06 pm

Bongodog49 wrote:
Now down to 12.77, the quoted February figures were down around 20% on most factors, and we need to bear in mind that Norwegian primarily works in Europe and North America, coronavirus only really became a major issue in these markets towards the end of the month. Any airline that was in the red last year will be at risk now


Well, they are down on ASK so a 20% drop, I assume they cut the non profitable routes and reduced capacity so obviously other factors like RPK and pax numbers need to go down as well. Their unit revenues are up 15% which is good, however they royally screwed up the fuel hedging, that is gonna cost them.
 
BealineV953
Posts: 204
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Re: DY about to go bust?

Fri Mar 06, 2020 4:28 pm

eniria:
You clearly are aware that other carriers added routes on top of Norwegian (I'm looking at you IAG/DLH) to suffocate Norwegian.

BealineV953:
Yes, I am fully aware that other carriers added routes to compete with Norwegian.
I do not accept that this was done to “suffocate” Norwegian. That is simply your subjective view.

enilria:
How can you make money when IAG adds flights on top of you on LGW-FLL/OAK that frankly make ZERO business sense for IAG other than to kill Norwegian?
IAG even explicitly tried to buy Norwegian to shut them down.
I mean, do they have to take out billboards saying "WE WANT TO KILL NORWEGIAN" for some people to get that clearly?

BealineV953:
Successful businesses make money by offering a compelling product at a price that covers costs.
I do not accept that IAG want to “kill” Norwegian or that IAG wanted to buy Norwegian to “shut them down”. Again, this is simply your view.

enilria:
Do you think for a hot second that Level or Eurowings is profitable?
LH has already reshuffled Eurowings like 5 times (and said it is not doing well repeatedly) and Level definitely does worse than Norwegian does.
Look at the publicly available data on LF and fare.
And the costs are only lower in terms of more dense seating. All the other costs are comparable. The economics for IAG on Level are this, and Eurowings is similar.
Option 1
1) Forego $X in profits per year competing with Norwegian forever (and they will grow making X bigger each year)
2) Lose 5X per year for a few years making sure they die, then shut down Level and raise prices back where they were or even higher to make up the loss

BealineV953:
Level is a relatively new carrier; it started flying in 2017. Businesses rarely make money in their first few years. Typically a business becomes profitable as it achieves economies of scale and begins to mature.
I don’t know enough about Eurowings to comment.
Norwegian was created in 1993, and began longhaul services in around 2014. It is a mature business, and should by now have found its place in the market.
If Norwegian goes out of business, IAG shuts down Level and then BA, Iberia and Aer Lingus raise prices, a new competitor will enter the market. Count on it.

enilria:
Completely agree, except it's not Norwegian that is irrational competitor, it is IAG using cross-subsidization and predatory competitive tactics to foist their money losing business into markets designed to hurt Norwegian.

BealineV953:
IAG is structured in a way that absolutely does NOT allow for cross-subsidisation. Each business unit must stand on its own two feet.
Even within IAG companies, parts of the business must deliver a return. For example; BA shorthaul services from Gatwick, longhaul services from Gatwick and so on. Where part of the business does not make a satisfactory return, IAG will look for ways of turning that round. That might mean substituting one airline with another, for example, Iberia services being replaced by Level.
Existing operators are perfectly entitled to compete vigorously with new entrants. They do not have to sit and watch their yields, revenue and market share decline. They are not obliged to simply roll over and give in. They are entitled to look for ways to defend their position, be that through reducing the costs of their existing businesses, creating new businesses that are better able to compete or whatever.
Ever since childhood, when I lived within sight of London Airport, I have seldom seen a plane go by and not wished I was on it.”
With apologies to Paul Theroux - ‘The Great Railway Bazaar’
 
Pontius
Posts: 70
Joined: Thu Dec 07, 2017 8:19 pm

Re: DY about to go bust?

Fri Mar 06, 2020 8:32 pm

https://www.reuters.com/article/us-health-coronavirus-norwegian-air/norwegian-air-dives-again-on-liquidity-worries-as-coronavirus-spreads-idUSKBN20T1H5
"ABG Sundal Collier forecasts Norwegian will have a cash balance at the end of the first quarter of 1.2 billion crowns and at the end of the second quarter of 0.9 billion crowns."

.9 billion krone = about $97 million USD. I don't think that's enough to run a enterprise that turns over $9 Billion USD annual revenue. Just don't see how this is going to work out, and I say that having paid for future Norwegian travel :(
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