When Norwegian Air Shuttle was formed on January 22nd 1993, few could have predicted that it would grow to an aviation powerhouse, taking on legacy airlines and creating headlines in the process. The carrier’s journey from operating a handful of turboprops in Norway to becoming Europe’s third-largest low-cost carrier is a story of bold ambition and hard-won lessons.
The humble beginnings of Norwegian Air Shuttle
But let’s take it from the top.
Like many airlines, Norwegian Air Shuttle (DY/NOZ) was founded amidst a time when the deregulation of national aviation markets was in full swing in Europe. With many flag carriers having operated basically undisturbed by competition until then, the new regulatory landscape led to fierce competition.
Norwegian initially operated domestic routes within Norway using Fokker 50 turboprops. Based in the country’s second largest city Bergen, the airline was founded out of the ashes of Busy Bee, a Norwegian carrier owned by Braathens who also performed flights on behalf of the latter. Norwegian simply took over the ACMI contract and hummed along for the coming years, growing their fleet by a couple of F50’s every now and then.
A notable event that would shape the airline took place in late 2001, when SAS (SK/SAS) purchased Braathens. Rather than honoring the contract that Norwegian had with the latter, SAS decided to have their own subsidiary SAS Commuter carry out the flights, terminating the contract without notice. Little did SAS know that this decision would inadvertently lead to the creation of one of its staunchest rivals in the years to come.
The low-cost revolution
Left with no stable revenue stream, the airline rebranded as Norwegian the following year and started to carry out flights under its own name. Boeing 737-300s entered the fleet and the carrier pivoted decisively toward a low-cost carrier model, immediately taking on said competitor on key domestic and intra-European routes.
Under the leadership of CEO Bjørn Kjoos, Norwegian aggressively pursued the Southwest Airlines playbook. They went for a standardized fleet, planned for quick turnarounds, operated point-to-point routes, and maintained a ruthless cost management. The strategy worked spectacularly. By offering fares dramatically lower than SAS while maintaining similar service standards, Norwegian captured market share rapidly across Scandinavia and into wider Europe.
The carrier’s fleet modernized quickly, at first transitioning to more efficient Boeing 737-800s. Norwegian’s January 2012 announcement that they had put in a record order of close to 400 aircraft (including options) from both Boeing and Airbus took the entire industry by surprise. That included yours truly, who almost fell out of his Los Angeles hotel bed upon seeing the news on CNN. Norwegian’s distinctive tailfin featuring various historically noteworthy characters from Scandinavia (and later beyond) became increasingly common at airports across Europe.
Norwegian’s transatlantic gamble
The gigantic aircraft order aside, perhaps Norwegian’s most daring move came in 2013 when it launched long-haul operations using Boeing 787 Dreamliners. Routes from Scandinavia to New York, Los Angeles, and Bangkok demonstrated that Norwegian wasn’t content being merely a European low-cost carrier.
On paper, the 787’s fuel efficiency made the decision look viable. Again, Norwegian expanded rapidly—adding routes from London, Paris, and eventually smaller European cities to destinations across North America and Asia. Fares from London to New York were aggressively priced, fundamentally disrupting the transatlantic market and forcing legacy carriers to respond with their own basic economy products.
The expansion into the longhaul segment however came at a hefty price. Aircraft deliveries were delayed and trailblazing passengers initially ended up flying A340’s wet-leased from HiFly (5K/HFY) rather than red-nosed Dreamliners. Finally in place, the fleet of Dreamliners turned out to frequently suffer technical issues, including snags attributed to the use of Rolls-Royce Trent 1000 engines. Norwegian kept ACMI-carriers such as Wamos Air (EB/PLM) and EuroAtlantic Airways (YU/MMZ) on speed dial as the struggle to make full use of their new shiny aircraft continued.
The operational complexity of maintaining widebody operations stretched Norwegian’s finances. Labor disputes, particularly with U.S. unions opposing Norwegian’s use of Ireland-registered aircraft and crew, added regulatory complications and reputational challenges.
The 737 MAX crisis and pandemic headache
As if this wasn’t enough of a burden for the ambitious airline, the global grounding of the Boeing 737 MAX in March 2019 further added insult to injury. While the airline “only” had roughly 20 aircraft of the type in its fleet at the time, more than 100 additional aircraft had been ordered. Norwegian had to scramble to find alternatives to support their expansion plans. Leased replacement aircraft at unfavorable rates became the solution. Meanwhile, their new, fuel-efficient jets sat idle with no immediate solution identified by either authorities or Boeing. Doomsayers started to whisper, and yet things would get worse.
A year later, COVID-19 waltzed into the collective human conscience. Norwegian of course was hardly the only airline suffering from the shattering effects of the pandemic. With borders closed and demand evaporating, Norwegian’s cash reserves depleted rapidly. A complex journey, involving multiple legal jurisdictions, attempting to reconstruct the entire company took place shortly thereafter. In hindsight, legally and spiritually overhauling the airline while the pandemic ravaged the entire industry was an efficient use of time during a highly uncertain period. Norwegian operated a bare bones operation during the global lockdown, re-negotiated contracts and laid off staff. It was as painful as it was necessary.
Dawn of the new Norwegian
Norwegian emerged from debt restructuring in 2021 as a fundamentally different airline. The long-haul operation was completely abandoned. The fleet shrunk to about a third of what it had been at the height of Norwegian’s dizzying expansion. The carrier refocused entirely on its core, cutting bases across Europe and elsewhere and instead focusing on short-haul operations within Europe and Scandinavia. Debt was cut by around NOK 63–65 billion in the process, revealing just how close to the sun Norwegian had soared.
The new Norwegian so far has appeared as a leaner operation, with significantly reduced debt and more conservative growth plans. That said, appetite for new business ventures hasn’t completely vanished. By the summer of 2023, the carrier announced an agreement to purchase the Norwegian airline Widerøe—a deal that eventually passed the eyes of regulators and was completed the year after.
What the future holds
Having learned from its previous modus operandi, Norwegian has rebuilt its network around profitable routes, maintaining its low-cost DNA while avoiding the overextension that nearly destroyed it. Load factors and profitability have returned, suggesting that a right-sized Norwegian can thrive in the European market.
Today, Norwegian operates 86 Boeing 737s (both 737-800 and 737 MAX 8), under two Air Operator’s Certificates (AOC)—one based in Norway and one in Sweden. From crew bases in the Nordic region and Spain it serves around 150 destinations, primarily in Europe.
The airline’s distinctive red livery remains a common sight at airports from Tromsø to Tenerife, and its fares continue to undercut legacy carriers. While the transatlantic adventure may be over, Norwegian has proven its resilience and rediscovered focus on what it does best: affordable short-haul travel in Europe.
6 Responses
I wish Norwegian would return to Stewart in Newburgh, NY where they left. Play has left as well. We need options as they were not only an affordable option but was beneficial for those living in upstate New York and travelled overseas.
Will never use low cost foreign carriers. Got burned by Play Airlines losing 2 fares and not receiving my Euros 600 each per EEU rules. Flight cancelled as we were boarding at planes door
If your smart you will fly a real airline.
No wonder the airline have economic success. They “steal” from passengers by No return of the relatively large sum for tickets after they cancel flights. Not one single response other than “Case Closed” I am not the only one reading from social media.
C. Robert.
If they ever plan to return to New York area I hor they choose SWF New York Stewart International Airport.
Thank you for a great article. I remember well, a flight from OSL-BKK in 2015. Our first flight on a Dreamliner, albeit in economy. I remember the tickets were about $300 AUD each. Always wondered what happened to that route.
Norwegian is an example of how to properly manage an airline facing serious financial difficulties, logistical challenges, and expansion issues. It has risen from the ashes like a phoenix. I wouldn’t be surprised if, in the near future, if the airline’s management continues to act so responsibly, they can resume long-haul international flights. Many people prioritize low prices over comfort (see Ryanair, the largest low-cost carrier in Europe). People don’t want champagne and caviar; they want to get from point A to point B as quickly and affordably as possible.