Low-cost airline Norwegian.com is looking on good financial shape going into 2019 thanks to a deal agreed with Rolls-Royce.
In a year end statement the airline said it had reached a deal with the Derby based engine manufacturer which “will have a positive effect from the first quarter of 2019.” but the terms of the agreement are confidential.
As a result of Dreamliners being grounded Norwegian was forced to charter aircraft from third parties to cover its scheduled commitments.
The deal with Rolls-Royce is another part of its plan to reduce costs and create significant savings throughout its operation. The plan, called #Focus2019, aims to save NOK 2 billion in total (£1.8 billion). Norwegian says it has already identified significant areas of savings from its operation.
It has secured the financing for all aircraft deliveries in the first half of 2019 and by refinancing assets which has had a positive liquidity effect of NOK 275 million (£248 million) to close the year out.
Norwegian goes on to say that is in in discussions about joint venture ownership of its fleet and those discussions are continuing with “full force”.
Norwegians cost saving measures come at a time when incredible pressures are being put on the airline industry with lower fares and higher costs. These conditions have already seen off low-cost rivals Primera Air in 2018 as well as several other airlines around the globe.
Norwegian has been aggressively growing over the last 12 months leading some to speculate its sustainability but it has proved them wrong at every turn. The airline recived significant interest from British Airways parent company International Airlines Group (IAG) but their takeover offer was rejcted, twice.
The airline has shaken up the long-haul air travel in particular by directly competing with legacy carriers and offering ultra-low fares on routes to North America, South America and Asia from London Gatwick (LGW/EGKK).