Norwegian Air faces resistance in US
The low-cost airline’s attempt to expand into the American market has met opposition from carriers and pilots
Norwegian American Weekly
Norwegian Air Shuttle has made a name for itself by offering extremely low-fare flights at half the cost of their competitors. CEO Bjørn Kjos claims that rates can be so low due to fuel-efficient planes, the internet replacing marketing, and a shift in global economic power. The 22-year-old airline has optimistic goals and has built up a fleet of Boeing 737s and Boeing 787 Dreamliners.
Norwegian Air already offers limited flights out of New York, Florida, and California, but it is aiming to expand its long-haul operations. In 2012, the company formed an Ireland-based subsidiary called Norwegian Air International for long-haul operations.
This allows the airline to benefit from the open-skies agreement with the U.S. and adhere to Irish regulations, which are much more flexible than Norwegian labor laws. The subsidiary was therefore able to hire cabin attendants from Thailand, developing bases in Bangkok, New York, and Florida.
In December 2013, Norwegian Air applied for U.S. government approval of a foreign carrier permit. American pilots and carriers responded by accusing Norwegian Air of breaking labor laws and sacrificing safety standards. American, Delta, and United submitted a joint reply to the permit request, claiming Norwegian Air violates Article 17 of the US-EU agreement, which states: “the opportunities created by the Agreement are not intended to undermine labor standards or the labor-related rights and principles contained in the Parties’ respective laws.”
The American opposition believes that Norwegian Air is using its Irish subsidiary to take advantage of weaker labor laws and enact unfair competition in the U.S. industry.
“It’s a convoluted business scheme,” claims the Air Line Pilot’s Association president Captain Lee Moak, arguing to the New York Times that the company wants to “exploit legal and regulatory loopholes to give them an unfair economic advantage over U.S. airlines that operate in a global marketplace.”
The U.S. Department of Transportation has yet to make a decision regarding the foreign permit application. However, a bipartisan group of 188 members of the House of Representatives submitted a letter to Transportation Secretary Anthony Foxx on November 24, requesting denial of the permit because it “would unfairly put domestic airlines at a competitive disadvantage.”
In response to the criticism, Kjos reports paying competitive wages to staff and supporting their right to form unions, and argues that opponents are just trying to protect U.S. carriers by limiting the competition. “We are used to the scrutiny to try to stop us, so this is nothing new for us, so when we enter an area, everybody knows that then the prices will go down, that’s good for the consumer, that’s how it should be. That’s competition,” he comments.
Although the airline’s U.S. operations continue to be limited, many Americans have taken the opportunity to fly Norwegian Air. One of the Norwegian American Weekly’s readers, Nils Wanberg, flew with Norwegian Air from Oakland to Oslo on October 1.
When asked about his experience, he responded positively, stating, “The flight departed on schedule and my overall experience was pleasant. The seating was satisfactory and the service was exceptional. The flight attendants were responsive to every need. The only thing that differed from traditional airlines was the new touch screen panel that offered a wide variety of movie selections and television shows.”
He did not feel affected by any of the opponents’ claims that Norwegian Air sacrifices safety requirements or takes advantage of labor laws. “I would be happy to travel Norwegian Air again. The reasonable cost of flying international is highly appealing and significantly cheaper than other airlines. I would definitely recommend Norwegian Air to other American travelers,” notes Wanberg.
The number of Americans who will end up sharing Wanberg’s experience as a Norwegian Air passenger all depends on whether the Department of Transportation will approve or deny the request.
This article originally appeared in the Jan. 23, 2014, issue of the Norwegian American Weekly. To subscribe, visit SUBSCRIBE or call us at (206) 784-4617.