Norwegian Air Close to Deal With Ryanair to Feed Travelers Onto Long-Haul Flights

Norwegian Air Shuttle AS may use the first of its Boeing Co. 737 Max jets to connect smaller European airports with cities such as New York and Boston, tapping the single-aisle planes to complement busier North American routes out of London and Scandinavia operated by wide-body 787s.

The narrow-body Max, which joins the Norwegian Air fleet from 2017, has the range to fly from Europe’s “western coast” to most locations on the Atlantic seaboard of the U.S., Chief Executive Officer Bjoern Kjos said in an interview.

“That’s going to be very interesting, because you fly direct so people don’t have to travel via hubs,” Kjos said in Oslo. “We believe that there is a large market there.”

Already a major discount carrier within Europe, Norwegian Air is working to extend the model to long-haul flights. While low-cost trans-continental travel proved unsustainable for companies such as Laker Airways in the past, Kjos is betting a new generation of fuel-efficient planes will make the service viable.

Fornebu-based Norwegian has 100 re-engined Max variants of the 737 on order from a mammoth deal with Boeing and Airbus Group SE announced in 2012.

Permit Question

The carrier also has 17 Dreamliner 787s due by 2018, of which eight are already in the fleet. Kjos said he’s holding off on a possible follow-on order while awaiting a foreign carrier permit from the U.S., where airlines and unions have queried the legitimacy of plans to register jets in Ireland to cut costs.

The CEO said the permit is needed before Norwegian can start “full-scale” flying with the 787 fleet, since aircraft that might operate routes to Canada, South America or South Africa would ultimately also serve U.S. destinations.

“They have to fly in a combination because of the utilization of the aircraft,” Kjos said. “It’s long overdue.”

The CEO also confirmed that talks are under way on cooperation with Ryanair Holdings Plc, Europe’s biggest discount carrier, that could see theIrish company help feed passenger’s onto Norwegian’s long-haul flights “from every corner of Europe.” A deal could be concluded “shortly,” he said.

Norwegian is stepping up plans to lease out a chunk of the 100 Airbus A320neos it also has on order, having already arranged to place 12 with third parties, the first four in 2016, Kjos said.