Norwegian airliner Norwegian to buy 222 new aircraftWednesday, 25 January 2012
Norwegian budget airline Norwegian buys 222 new airplanes. The company will buy 122 aircraft from manufacturer Boeing, of which 100 items will come from the new Boeing 737 MAX8.
Norwegian has also signed an agreement with Airbus to buy 100 Airbus A320neo. The total value of purchase is Nkr127 billion. The company has also secured purchase rights for an additional 150 planes from both manufacturer
Advertisement"Our order is the largest a European airline has ever entered, and a major milestone in the company's 10-year history," writes the Norwegian CEO Bjorn Kjos in a statement.
The order is part of the company's long term planning, among other things to have a fleet where aircraft are rotated out every seven years. To do so requires a plan for at least 10-20 years to come, according to the company.
"We are also comfortable with the financing to come. Norwegian has reached such a large size that we can usefully have two aircraft manufacturers, both to secure enough air capacity, flexibility, but not least, to benefit from competition between two producers," writes CEO.
Norwegian shares rose by about twelve percent since the company unveiled its record orders for new aircraft.
Flight analyst Hans Eric Jacobsen at Swedbank told Reuters that he believes the Norwegian will be one of the dominant players in the European market in the future. And for competitors such as SAS, it becomes a major challenge.
By 2022, it is estimated that Norwegian fleet in service would be in the region of 179 aircraft, which would represent about six percent of the total number of passenger aircraft in Europe, says Norwegian CEO Bjorn Kjos at a press conference, according to Reuters.
Also it is added that financing of aircraft purchases will not be a problem. Any issue of shares is not a must.
“We do not depend on getting money on the market or to make use of banks,” he says.
Today Norwegian has a fleet of 62 aircraft. By comparison, SAS, is still Scandinavia's largest airline, about 180 aircraft.
By Scancomark.se Team
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