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Norwegian and Boeing bury the hatchet

Low-cost airline Norwegian Air Shuttle on Monday unveiled a big order from Boeing as part of a deal that ends a long-running dispute with the US aircraft maker and helps get its flagship 737 MAX back on track.

According to this agreement, Norwegian, which escaped bankruptcy in extremis last year, will order 50 medium-haul 737 MAX to replace the rental aircraft it operates today, with an option for 30 more.

This order is part of “the resolution of a dispute that we have” with Boeing, explained the company’s general manager, Geir Karlsen, to the TV2 Nyhetskanalen channel.

Mr. Karlsen mentioned “compensation of 2 billion crowns (197 million euros, editor’s note)” granted by Boeing, “which we used to buy planes on advantageous terms”.

According to him, the price paid is “much lower” than that which Norwegian had to pay a few years ago for its first 737 MAX -sold since- but also to that offered by the European competitor Airbus.

Norwegian and Boeing had been waging a standoff for several years, the first claiming compensation from the second for the setbacks encountered with its 737 MAX but also with its long-haul 787 Dreamliner.

The Norwegian low cost announced in June 2020 that it had taken legal action against the American manufacturer to obtain compensation.

In addition to allowing the extinction of these lawsuits, the new agreement helps to revive the 737 MAX, Boeing’s flagship model, which had been grounded for twenty months following two fatal accidents close together and which has been gradually returning to service since end of 2020.

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After companies like the Caribbean Arajet and the American Allegiant Air, the 737 MAX has also found takers with the British carrier IAG, parent company of British Airways, which has just ordered 50 copies with an option on 100 others.

– Return to full ownership –

The agreement with Norwegian remains subject to unspecified conditions, which the carrier hopes to see lifted by the end of June.

It marks for Norwegian a return to the possession of own aircraft after being reduced, financial difficulties oblige, to operate rental aircraft.

Weighed down by an overambitious expansion, technical problems with its fleet and the Covid-19 pandemic, the company had narrowly avoided bankruptcy last year at the cost of a vast restructuring which had notably led it to give up its intercontinental activities, to reduce its fleet and to cancel numerous orders.

The 50 new medium-haul aircraft will be delivered between 2025 and 2028, around the time the current aircraft lease agreements come to an end.

Unless the options are implemented, Norwegian’s air capacity should therefore not increase beyond what has already been announced.

“It’s more a sign of an airline that is becoming more normal, that no longer lives exclusively on rental aircraft but owns part of its fleet itself,” commented Sydbank analyst Jacob Pedersen. , from e24.no.

“To me, this proves that Norwegian is making a comeback as an airline,” he added.

The low cost, which currently operates 61 aircraft, plans to ramp up its fleet to 70 aircraft this summer, then 85 during the summer of 2023.

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The Boeing 737 MAX 8, it argues on Monday, is “about 14% more fuel efficient than previous generation planes”, thus limiting the environmental cost a little but also the energy bill against a backdrop of rising fuel prices. kerosene.

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