Norway and the long-haul, low-cost aspirations

Like buses, you wait all day for a long-haul, low-cost Scandinavian airline, and then two come along at once. It is almost a year since initial details first emerged of the ambitions of Norwegian start-up Feel Air and the touted long-haul project from Norwegian, though it will be 2011 at the earliest before either take to the sky

Kai Holmberg – chief executive of planned Norwegian (the place, rather than the airline) start-up Feel Air – was at the recent Low Cost Airlines Congress in London. His airline has identified initial routes connecting Oslo Gardermoen and Stockholm Arlanda with New York JFK and Bangkok and had originally hoped to begin flights in the spring of this year. Holmberg said recently the airline has now secured funding for its first phase and is in talks with investors for further funding.

Asked about the progress of the project during a panel debate at the LCC Congress, Holmberg said Feel Air would begin flights next year – but would not specify beyond that. He though says in the meantime the carrier has strengthened the robustness of its plan. “I think it is a much more robust business plan. From two destinations, we have identified an opportunity for nine aircraft [in the longer-term], including some medium haul routes to balance utilisation and seasonality.

“And from an external side, I think the market opportunity has grown stronger. I haven’t seen lease rates go up much. I think it is good timing for this opportunity.”

holmberg.jpgHe says the carrier has learnt lessons from previous successful and not so successful operators in the field.  “Staying out of any lion’s cages is one of the lessons. Feel Air is staying focused on the leisure flows and we are really dependent only on Scandinavian flows [of passengers].” And he sees big potential in the market. “It is a market that is so well educated about travelling low-cost and how to self-connect, and has high propensity for travel.”

Scandinavia’s largest existing low-cost carrier Norwegian has also floated the idea of beginning a long-haul operation, which would though operate as an independent entity to the short-haul carrier. It has previously said it envisions acquiring up to 15 widebodies for the long-haul operation to begin in 2011 and has listed New York and Bangkok as being the most likely initial destinations. Its chief executive Bjorn Kjos was recently quoted as saying it would make a decision on fleet type this month

“We have not made a final decision and we are talking with Airbus and Boeing about possible deliveries,” Norwegian’s chief commercial officer Daniel Skjeldam said in London at the LCC Congress. “We have a very good feeder platform. You need a good feeder [for the long-haul], although its not a feeder [network] in the traditional feeder sense.”

Skjeldam meanwhile was talking up the carrier’s forthcoming debut of connectivity onboard its aircraft; the airline is working with Row 44 on the project and will start on two aircraft before a fleet-wide deployment. “One ancillary [service] we believe will be very ground-breaking is wireless network, hopefully starting in October and we believe that will change the preferences for business passengers. It will be so ground-breaking that even FFPs won’t be so important as whether we have wi-fi onboard,” he suggests, at least until other carriers follow suit.

To find out more about fast-growing Norwegian check-out the Airline Business cover interview I did with Bjorn Kjos in January 2009 (which includes by some distance the most stunning backdrop for a CEO photo-shoot I can remember – see below).

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