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Norwegian Furloughs 1,600 More Employees

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Following the news that Norwegian would not be receiving any more state-aid from the government, the airline announced Monday that it would need to furlough another 1,600 employees. Furthermore will cancel all international flights immediately, and keep only five planes active to serve 12 domestic routes.

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Norwegian will be furloughing another 1,600 workers and operate a fleet of only 15 planes on domestic routes. Photo: Getty Images

The news that the Norwegian government would not provide any more direct support to Norwegian Air struck yet another massive blow to the struggling Nordic low-cost carrier. The leisure-focused airline has barely been keeping its head above water for the past eight months. The government has previously granted Norwegian a state aid package equalling $330 million and a subsequent loan extension

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The carrier’s CEO, Jacob Schram, signaled months ago that his airline would need further assistance, should the pandemic continue beyond summer. Continue it has, and not only that, the virus has hit new record numbers of contagion across Europe, with harsh travel restrictions as a result.

More furloughs and almost entire fleet back to parking

With no immediate redemption from the government insight, Norwegian announced Monday that it would need to furlough another 1,600 employees. It will also park over half of its already minuscule active fleet of 21 aircraft.

“Following today’s disappointing announcement from the government, we have no choice but to furlough an additional 1,600 colleagues and park 15 of the 21 aircraft we’ve operated the past months,”

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Mr Schram said in a statement seen by Simple Flying.

“Recently government-imposed travel restrictions have effectively stifled any hope of a stable and progressive recovery, Norwegian has been hit from all sides by factors outside of our control,” he continued.

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It is unclear if Norwegian will make it through the winter. Photo: Getty Images

Left with 600 employees and 12 routes

Norwegian will keep serving 12 domestic routes, for which the Ministry for Transport is providing subsidies. The routes are from Oslo to Alta, Bergen, Bodø, Evenes, Haugesund, Kirkenes, Molde, Stavanger, Tromsø, Trondheim, and Ålesund, and between Tromsø and Longyearbyen.

At the beginning of the year, Norwegian employed over 10,000 people. With the most recent furloughs, the number will be down to a previously unthinkable 600. Only five planes will remain active to serve domestic routes in Norway. The company stock fell by nearly 17% after Monday’s news. Since the beginning of the year, it has dropped by over 98%.

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On Tuesday, Norwegian reported losses of over $108 million for Q3. Photo: Getty Images

Is there any hope for a New Norwegian in the new normal?

At a press conference yesterday, Norwegian’s CEO said that the news that the government had rejected its application for more funds felt like “a punch to the gut,” as reported by Svenska Dagbladet. Schram also said that he was not excluding bankruptcy as a consequence.

As expected, the airline’s third-quarter results released Tuesday made for gruesome reading. Norwegian reported a loss of NOK 980 million ($108,5 million) for the three months ending in September. Even before the pandemic, Norwegian was struggling financially. Now, with only $376,5 million left in liquidity, its very survival and ability to keep flying into 2021 is entirely dependent on finding other actors willing to inject a substantial amount of cash.

Do you think Norwegian will still be flying come next year? Where could the money possibly come from? Let us know your thoughts in the comments.

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