| Carrier: | Norwegian Air Shuttle
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| Headquarters: | Norway
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| Founded: | 1993
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| Destinations: | 55
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| Bases: | Oslo, Warsaw (Planned)
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| Owners: | Public
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| Listed: | Yes
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| Online Booking: | Yes
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| Website: | http://www.norwegian.no
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| Fleet | B737-300 20
| Overview - Norwegian Air Shuttle Norwegian Air Shuttle – a tough time Norwegian Air Shuttle (NAS) became a true LCC in 2003, when it closed its domestic, F-50 operations in northern Norway and concentrated on low cost operations. Since then, it has posted impressive growth, if with mixed financial results.
NAS problem has not been attracting traffic, as the wealthy and travel-inclined Norwegian populace have embraced its offerings. And the carriers capacity growth – fuelled in part by fleet growth from 12 B737-300s in Mar-05 to 19 today – has been exceeded by its traffic gains. In 2005, NAS carried 3.3 million passengers, up 59% year-on-year. Impressively, its 76% unit traffic gains far outstripped its 51% increase in capacity, as system load factor increased 11 points to 78%. However, the yield and cost situations are less encouraging. With the price of fuel particularly punishing for NAS old-generation Boeings, it has increased efficiencies in other areas. For instance, it achieved 77% of bookings via its website (up from 66% in 2004) and achieving aircraft utilisation rates of 9.6 hours a day (up from 2004s 6.8 hours). The issue of yields is largely outside its control, as pricing power in the Nordic markets is low. Although NAS has appealed for government intervention against domestic rivals pricing policies, it remains vulnerable in the over-supplied northern market.
This situation no doubt contributed to the Apr-06 announcement that NAS will open a base in Warsaw as well as access lower labour rates in the Polish capital. The carrier intends to operate two B737s from Warsaw in Jul-06, serving Oslo and four holiday destinations in Spain and France. An uncertain future NAS has performed well in marketing its services to the Norwegian consumer, but it is difficult to see how it can compete in the well-served Polish market. Without a return to exclusively focusing on its home market and fuel price relief, the carriers success will remain questionable.
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