Norwegian Air CEO: Open Skies delay ‘costs us a fortune’

by Keith Laing, The Hill Newspaper
11/20/14

Norwegian Airlines CEO Bjorn Kjos said Thursday that the Department of Transportation’s (DOT) prolonged consideration of its bid to gain more access to airports in the U.S. and European Union is costing his company “a fortune.”

Norwegian Air is attempting to gain access to airports that are covered under the U.S. and European Union’s Open Skies agreement by registering its airplanes in Ireland, which is a member of the EU.

The Scandinavian company has said it will be able to offer transatlantic flights for as low as $150 each way if its effort is approved by the Department of Transportation, where it has been pending for most of the year.

Kjos said Thursday during a speech to the International Aviation Club (IAC) that the lack of a decision from the Obama administration was costing his coming money.

“It costs us a fortune for every day we don’t get the approval,” Kjos said. “We cannot start flying the aircraft that we buy into Asia. They have to stop in Stockholm or Copenhagen because that aircraft is not allowed to fly into the U.S.”

Labor unions that represent pilots and flight attendants that work for U.S.-based airlines have strongly urged the DOT to block the Norwegian Air “Open Skies” application, arguing the company is only able to offer lower ticket prices for international flights because its skirts labor laws that are normally applied to air carriers.

“Passengers expect, and our industry demands, that airlines abide by U.S. law and policy, employ experienced pilots and crewmembers, and operate under robust government oversight to ensure safety,” Air Line Pilots Association President Lee Moak said in response to Kjos’s speech Thursday. “DOT must deny NAI a U.S. foreign air carrier permit.”

Kjos blamed the opposition to his company’s “Open Skies” bid on “just a few people that are trying to stop American people from being able to fly on low fares over the Atlantic.

“It’s a Boeing,” he said. “It’s the same crew. It’s the same pilots and they’re definitely not unsafe.”

He added that the approval of the application that is pending before the Transportation Department would create much-needed jobs in the U.S.

“If I fly twice as many people into the U.S., I need twice as many cabin attendants,” he said. “I need twice as many pilots.”

Critics of Norwegian Air’s bid already won a victory from the Obama administration when the department ruled in September that the company did not qualify for an exemption that allows foreign carriers who are seeking access to U.S. airports under the Open Skies agreement to begin providing flights while their full applications are still being review by federal regulators.

Norwegian Air currently flies planes that are registered in its home country to airports in New York, California and Florida under a subsidiary company that is known as Norwegian Air Shuttle. However, Kjos said Thursday that the low-cost business model for his company’s main airline requires access to more “Open Skies” airports in Europe, which also requires U.S. approval as part of the original agreement, to provide more route flexibility in its flight network.

Norwegian has been trying to get approval for a full foreign carrier permit by registering its airplanes in Ireland instead of in its home country, which has riled members of the U.S. aviation because they argue that Irish aviation regulations are more lax than other EU nations.

The groups that have vocally opposed Norwegian Air in a year-long turbulent fight were hardly convinced by the CEO’s speech in Washington on Thursday.

“The NAI operating scheme has no place in the powerful and growing airline trade alliance between the U.S. and Europe — an alliance that if implemented as intended holds great promise for air travelers, for the economies on both sides of the Atlantic and for middle class airline job creation,” AFL-CIO Transportation Trades Department President Ed Wytkind said after the Norwegian CEO made his remarks.

“Speeches and PR gimmicks cannot negate the facts,” Wytkind continued. “This flag of convenience scheme would set a dangerous precedent that risks decimating the U.S. aviation industry and destroying thousands of jobs here and in Europe. For this reason, and because NAI’s application blatantly flouts the terms of the U.S.-EU Open Skies agreement, the U.S. DOT must deny NAI’s application.”

www.thehill.com/policy/transportation/224925-norwegian-air-ceo-open-skies-delay-costing-money

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