The Norwegian leadership will significantly reduce the fleet to save the company. In October, two of the big Dreamliner planes disappeared from the fleet. Several planes are now on the move, but the Norwegian has not yet escaped lease and bills.
On Thursday, the Norwegian presented the main points in the second rescue package that the company will now implement under Irish bankruptcy protection.
The company adopted its first bailout package in May, which reduced its debt and triggered loan guarantees of three billion from the Norwegian state.
In the long-awaited second bailout, the horse medicine the company deems necessary to survive continues: Debt will be further reduced, vehicle fleet will be reduced and even more fresh capital will be raised.
On Monday, the Norwegian must persuade Irish judge Michael Quinn to approve the company’s bankruptcy application and the company’s survival plan.
How many planes the Norwegian wants to have in the future and how many they manage to get rid of is a key part of the financial restructuring puzzle that is being set up now.
For every single aircraft that goes missing, whether owned or leased, Norway’s debt and lease obligations are reduced by significant sums.
In addition, the company saves large current operating costs and aircraft maintenance costs that are currently of little use.
New Norwegian crisis plan: raise raise up to 4 billion fresh money
Looking for new airline customers
Even before the crown, the Norwegian began selling older short-haul aircraft of the 737 NG type, both to adjust the company to lower growth and to make money.
In August, the Norwegian leadership announced that almost half of the 37 long-haul aircraft (787 Dreamliners) had to leave the fleet – somewhere between 15 and 17 aircraft.
However, the pandemic meant that the need and value of used aircraft were suddenly significantly reduced.
CEO Aengus Kelly of leasing giant AerCap, which owns several Norwegian aircraft, recently described how the aircraft market came to a complete halt this spring.
During the summer and fall, the market began to move again. In October, AerCap borrowed two 787-9 Dreamliners from Norway and leased them to Italian tour operator Neos.
This was the first time a Dreamliner had left the Norwegian.
Kelly said the remaining 787 leased in Norwegian were also “currently being sold” to other potential customers.
The same thing happens with other leasing companies and with the Norwegian himself, in an attempt to see if anyone else needs the planes that the Norwegian himself no longer wants.
Working to make the Norwegian “invested”: – The debt will be reduced
The flights are “home” to Ireland
During the AerCap quarterly presentation, the CEO described what they did when the aircraft market was virtually frozen:
They chose to leave the planes with airlines that struggled financially, as long as they could maintain, maintain and maintain their operating certificates.
After two planes were dispatched from the warehouse at Oslo Airport in Italy in October, things started to happen again in the last month:
E24 / Aftenbladet received advice that several Dreamliner planes had recently left the airport in Sola, which was one of the “parking spaces” used by the Norwegian during the corona crisis.
Initially, E24 / Aftenbladet observed 26 Norwegian aircraft parked on Sola this summer, 11 of which were 787 Dreamliners.
It is unclear how many there are now, but according to the Norwegian director of finance, several stored planes have been relocated.
– Did AerCap or other leasing companies return more aircraft than the two in October?
– It is publicly known that we returned two planes to AirCap. As for the others he comments on, it is nothing more than putting them in “air condition” (state of the aircraft after storage, logs, etc.), says SFO Geir Carlsen.
By taking them out of long-term storage and in-flight condition, leasing companies will be able to quickly transfer aircraft to new customers when they find them, thus easing the Norwegian burden.
“They want the planes repaired and parked in a place of their choice, but they are still rented in Norwegian,” Carlsen said.
The leasing giant will lease all the planes they rented in Norwegian
One of them is a British registered aircraft with registration number G-CKWB. According to Flightradar24, he took off from Sola Airport at 12:25 and landed just over an hour and a half later in Shannon.
The Aeronews website posted photos of Shannon Airport on November 26 when the plane arrived for safekeeping.
However, SAS will apply to Norway for a loan guarantee: – We must prepare for very low demand
It is unclear how big the fleet will be
At a board meeting on November 17, the Norwegian board decided to “reduce the aircraft platform” for the company as part of a restructuring in Ireland, according to a notice of the company’s general meeting.
– What entails this decision of the board, how many aircraft will leave the fleet and will you reduce the number of AOC (subsidiaries with aircraft licenses)?
– We are working on a plan for adjusting the vehicle fleet. “We are in the process now and we have a plan where we will end up, but the final decision has not been made yet,” CEO Jacob Schramm told E24.
Earlier this year, the Norwegians outlined a plan in which they went from the original pre-coronary plan of 168 aircraft in 2020 to between 110 and 120 aircraft after the crisis.
Now Schramm says it is too early to go public with exactly how big and what the fleet will look like.
“We have a plan for what we want to achieve, but we must also consider the outcome of the planned issue of up to four billion kroner,” said CEO Geir Carlsen.
Historical deficit in SAS: 10.6 billion before tax